Overnight Oats Empire: From Poker Winnings to $100 Million in Revenue
DAYTON, OH – A company born from poker profits and a unique overnight oats concept has rapidly scaled to $100 million in annual revenue, fueled by a dedicated subscription base and a willingness to embrace unconventional marketing. Oats Overnight, founded by Sam Tate, has secured $65 million in funding, culminating in a July 2024 investment round led by Enlightened Hospitality Investments – the firm founded by Shake Shack’s Danny Meyer – valuing the company at $230 million.
The business initially launched in 2016, funded by Tate’s earnings from professional poker. The product, a protein-rich oats mixture available in three initial flavors (chocolate, strawberry, and green apple), requires overnight refrigeration after mixing with milk. Tate quickly pivoted to a direct-to-consumer, monthly subscription model, recognizing the importance of integrating the product into customers’ lifestyles. “Loyalty is everything,” Tate stated, emphasizing a customer-centric approach.
Subscribers receive a free shaker and a 25% discount on thier first order, with a 16-pack box typically costing $60, discounted to $45 for new members. this strategy has proven successful, building a subscriber base of 300,000, which currently accounts for 90% of the company’s revenue.
Product development has been a key driver of growth,expanding the flavor offerings from the original three to 30 core flavors,supplemented by an additional 30 special editions. A dedicated R&D team of 13 leverages direct customer feedback – gathered through a private Facebook group – to refine formulas and maintain a customer loyalty rate exceeding 60%.
In 2021, with $23 million in revenue, Oats Overnight began expanding into retail channels. recognizing the challenge of conveying the “spoon-free” concept, tate developed a disposable container with a fill line for milk or water. The company now distributes to major retailers including Wegmans, Whole Foods, Walmart, Target, Costco, and Sam’s Club, contributing to the jump in revenue to $100 million in 2023.
To support this growth, Tate recently opened a 310,000 square foot production facility in Ohio. This expansion is projected to quadruple production capacity, reduce delivery times by two days, and lower shipping costs by over $3 per box. The company achieved profitability this year and is currently not seeking further investment.
Tate’s background in poker continues to influence his business decisions,fostering a risk-taking culture.A 2022 marketing campaign targeting Gen Z on TikTok, which encouraged users to “scam Oats Overnight” with influencers, initially lowered customer acquisition costs by 40% while increasing returns by 500% before being discontinued.Despite the campaign’s eventual halt, Tate views such calculated risks as opportunities. “Just like at the poker table, low probability but high reward opportunities should always be taken advantage of,” he said.
