Thursday, July 18, 2024

Hillsborough incubator dishes advice for food entrepreneurs

Neal McTighe, founder of Nellino’s Sauce Co., says the Piedmont Food & Agricultural Processing Center helped his company get its start. Frozen-food vendor Seal the Seasons, left, was also developed at the incubator.

By Mike MacMillan

Tucked away in an industrial building on the outskirts of Hillsborough is Piedmont Food & Agricultural Processing Center, a “food incubator” that’s home to about 48 would-be food entrepreneurs who pay $25 an hour to share space and time in the building’s four commercial-grade kitchens.

Most of their offerings rarely make it past the local grocery store or the farmers market. While the barriers to entry are low, the obstacles to large-scale success are high, including the food industry’s tight margins, distribution challenges and regulatory scrutiny. Like everyone else, food businesses also need ample capital.

“It’s one thing to deliver a case of product. It’s something else when you’re producing by the pallet. That’s a major transition that not every company will make,” says Eric Hallman, who runs Piedmont along with a full-time assistant.

Piedmont Food was established in 2011 by Orange, Durham, Chatham and Alamance counties and funded largely by grants. Its purpose is to provide access to a professional kitchen for food entrepreneurs to develop their products, consult on regulatory and distribution matters, and offer guidance on financial issues.

It was struggling by the time Hallman came aboard in 2015. He previously led another nonprofit for three years and served as a Hillsborough town commissioner for more than a decade. He applied for new grants and over the last few years Piedmont has received more than $420,000 from entities including the U.S. Department of Agriculture, the N.C. Department of Agriculture Farmland Preservation Trust, Orange County Economic Development and the Golden Leaf Foundation.

Piedmont isn’t the only place to latch onto the locally sourced food movement called locavore. There are multiple food incubators and shared professional kitchens throughout the state, such as Blue Ridge Food Ventures in Candler and the Cookery in Durham.

Neal McTighe, founder of Nellino’s Sauce Co.
[/media-credit] Neal McTighe, founder of Nellino’s Sauce Co., says the Piedmont Food & Agricultural Processing Center helped his company get its start.

The headline success stories for the Piedmont Food center are Chapel Hill-based Seal the Seasons, which works with farmers in 36 states to freeze produce in season and sell it in local grocery stores, and Raleigh-based Nellino’s Sauce Co., which develops and markets tomato-based sauces. Seal the Seasons products are sold in 3,200 stores including Whole Foods Market, Harris Teeter Supermarkets, Ingles Markets, and Food Lion. Nellino’s is available in 1,000 stores throughout the Southeast and mid-Atlantic.

Nellino’s founder, Neal McTighe, who describes himself as “the worst student of Italian at Dickinson College,” based his recipes on memories of sauces made by his grandmother and mother and his eating experiences from living in Italy for three years. He began experimenting with sauce in his own kitchen in 2010, then moved to Piedmont to scale up about a year later. “We couldn’t have done what we did without Piedmont Food,” McTighe says. “They were instrumental in getting us going.”

McTighe built his company around the family-recipe narrative. He also eventually earned a Ph.D. in Italian from UNC Chapel Hill. “He understood early on that he wasn’t just selling a product, he was selling a story,” says Hallman, referring to Nellino’s founder. McTighe scored a small contract with Costco Wholesale Corp. in 2015 and has since expanded into additional retailers including Harris Teeter, Whole Foods Market, Ingles Markets and Earth Fare.

Patrick Mateer started Seal the Seasons in 2014 when he was 21. A graduate of UNC Chapel Hill, Mateer worked at the local farmers market while in school. There, he saw that farmers struggle to sell their produce despite growing interest in local foods, many of which were available only a few weeks a year. By freezing produce in season, Mateer preserved its freshness and created a product that can be sold year-round.

Seal the Seasons started at Piedmont in July 2014, and by October 2017, had outgrown the space. Mateer looks back on his time there fondly. “Piedmont is an amazing place,” he says. “It gave us a low-risk, low-cost way to get started.” Other companies are trying to follow in its footsteps, including Haw River Mushrooms, which developed a mushroom-based jerky, and Kyookz, which sells craft pickles.

“North Carolina has a real opportunity to grow in the food business,” Hallman says. “It’s just a question of committing the resources to getting it done.”

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