Middle-Market CEO Interview: Jimmy DeSisto of Venice Bakery

Nine years after Jimmy DeSisto of Venice Bakery set out to make a gluten-free pizza crust, the bakery’s offerings are filling menus across the country and shipping containers on their way to the UK and Australia. DeSisto spoke to MME about the coveted crust he used to reinvent his 120-employee firm.

MME: As a family-owned company, Venice Bakery has successfully undergone generational transitions. Did the business hit any snags along the way?

DeSisto: To be able to pass a torch from one generation to the next in business is something very challenging to do. We are a third-generation family-owned business. It was started by my grandfather, who came to America from Sicily in 1930. I know that it was difficult for my grandfather to pass the torch to my father and for my father to pass the torch to me. A business is like a child to you, and there comes a day when you need to let it go, because you just can’t work just a little bit — either you’re in or you’re out.

MME: What did your grandfather have in mind?

DeSisto: My grandfather’s first bakery was in the Bronx. Then fast-forward to 1953, when he had a wife and four children and enough money in his pocket to move out west to LA and buy Venice Bakery Company in Venice Beach, California. In 1969, he needed more space, so he built a building in El Segundo, where I am sitting today. Today, our business is thriving. I actually bought another building last year in the city of Torrance, which is about 15 miles south of us, and I’m constructing a new bakery that will be about ten times the size of our current facility. We’ll always keep the El Segundo facility operating — we’ll just be adding more production space and increasing our output through our Torrance facility.

MME: Who are your customers today?

DeSisto: We supply products to supermarkets, club stores, school districts, airlines, amusement parks, and the military. We also do private label pizzas that may be under a supermarket’s name or under a national brand name that may have a Venice Bakery pizza base underneath it.

MME: Where is your growth coming from?

DeSisto: For any business to survive generations, it must reinvent itself, and there always has to be that something that leads to that reinvention. When I took over the business 18 years ago, we were doing the traditional things that had been our staples. We then experimented — I started making a lot of frozen pizza dough balls. But what the reinvention has been for us is my gluten-free pizza crust. I created a gluten-free pizza 9 years ago when a doctor friend of mine told me that she had proven through a gluten-free diet that the behavioral patterns of autistic children she was working with were improving. In light of me having a couple of close friends with autistic boys, I said that if this is true, I would create a great gluten-free pizza for these kids. Basically, the doctor challenged me to me make gluten-free, dairy-free, soy-free, egg-free, corn-free, and vegan pizza crust because that is what she needed for a clean diet for these children.

MME: Where did you begin?

DeSisto: Well, I realized pretty quickly that standard baking practices wouldn’t work with the gluten-free process. We needed to use rice, potatoes, tapiocas, and I realized that to create a great gluten-free product, we had to start with a dough with a much higher moisture content than our typical doughs. Using trial and error, we came up with a recipe for a great product, but then we had to figure out how to high-speed-process this material, since it wasn’t really a dough anymore, and the concept slowly came together. We had to find the right type of machines, and lot of the equipment needed to be custom-built. We have created a high-speed manufacturing line for gluten-free pizzas that are sold through national distribution channels and end up not only at pizzerias throughout our country but also in the UK and Australia.

MME: How do you protect what you’ve invented? Is there a way to patent pizza crust?

DeSisto: Trying to patent things in the bakery business is kind of silly because there are so many ways in which recipes can be manipulated. How we protect ourselves is that we just do not allow any outsiders in our facility. When we run jobs with national brands, we do allow quality assurance folks to be involved in the process for safety reasons, but other than that, the facility is closed to all outsiders. Today, we are the leader in gluten-free pizza.

MME: Where are the added costs in this process?

DeSisto: We can’t just rely on our suppliers to assure us that all of our raw materials are gluten-free. We need to test the products ourselves. We need to ensure that the tests that we’re doing in-house are accurate, and this can get rather expensive. There are costs related to setting up the bakery, but there are daily costs as well.

MME: We would imagine that other baking businesses are now eyeing what you saw nearly a decade ago …

DeSisto: I’m sure they’re working on some things now in light of how the gluten-free opportunity has developed and because bakeries can now calculate the ROI when it comes to spending $5 million on this type of equipment. Meanwhile, you see us expanding into other gluten-free products like cookies, wraps, and calzones. We have a cheese ravioli product that we’re now creating entrées for — these will be private-labeled and packaged under different names in different markets.