This engineer went from selling food packaging to Subway to creating his own Mexican food brand

A home-cooked meal is a labor of love.

And for Miguel Leal, a Mexican-born entrepreneur, the love for Mexican food is what eventually led him to begin his entrepreneurship career.

Leal and two friends, Daniel Lubetzky and Rodrigo Zuloaga, are the founders of SOMOS Foods, a company of ready-to-eat non-GMO and gluten-free Mexican products.

Now only a little over two years old, SOMOS Foods is already sold in 9,000 retail stores nationwide, including Whole Foods.

While Leal found success with his food business, he didn't go into that sector right away. As a matter of fact, he initially wanted to pursue a career in engineering.

A family of entrepreneurs

"I come from a family of entrepreneurs," Leal said. "I saw both of my grandfathers start their own business and, you know, my dad, my uncle... I saw all the effort and all the risks that they took."

Leal grew up in Monterrey, a city in northern Mexico known for its exceptional barbecue scene and proximity to the U.S.-Mexico border.

At a young age, Leal would watch his family grow businesses, some more successful than others.

But he particularly learned a lot from one of his grandfathers, who created an industrial equipment company named Tolteca.

"My grandfather would bring me in to translate to the people installing equipment at his factory," Leal said.

Leal added that he would watch his grandfather buy discarded equipment from Europe to put in his factory, something that impressed him due to the risks it entailed.

"I was in my early teens and it was just so impressive on me," he said. "Like it just really dawned on me the risk and reward that he was taking."

He eventually grew up to study industrial engineering at one of Mexico's best schools, the Monterrey Institute of Technology. After graduating, he had planned to continue specializing in engineering but opted to pursue an MBA at the University of Pennsylvania instead.

Venturing into entrepreneurship

After graduating with an MBA from UPenn and meeting his wife there, Leal opened his first business in 2002. Select Product Group sold packaging to fast-food restaurants.

"We made food packaging for Subway," Leal said. "It was quite successful, we grew to over a hundred million dollars in sales."

Years later, in 2007, Leal would sell the company to Georgia Pacific, one of the world's largest manufacturers and distributors of tissues, paper and pulp -- an achievement he says really started his entrepreneurship career.

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Miguel Leal

Despite making millions from selling his company, Leal still had to figure out the next step in his career.

"We made a little bit of money," Leal said. "But not enough to retire, so I had to work."

From working paper to food

So here's Leal in 2007, having sold his first multi-million dollar company and thinking ahead on his next challenge.

He was not a recent graduate anymore, and he had two new things to consider in his personal life: a newborn daughter and his wife, Jeanette, had quit her full-time job to become a yoga instructor.

"All of a sudden, not only was I a dad, there were three of us and I was the main breadwinner," Leal said. "It was a lot of pressure on what I was going to do next financially."

So he first thought of starting a restaurant, but after exploring the different possibilities, he opted for a job where he wasn't the boss. He began working for Frito-Lay as a brand manager, where he (sort of) took a break from the stress of running a company and focused on what he loved most: food and people.

"I was the lowest person in the marketing organization and I loved it," he said. "I worked with really smart people and I am here today with so much because of that decision."

Leal wound up working for Frito-Lay for two years and then quit to work for other companies like Danone and KIND until he wound up at Cholula, the Mexican hot sauce maker.

"The most important thing that I learned from that brand was that people are interested in quality food from Mexico," Leal said.

"That was just like a huge, huge eye opener and a point of pride for me," he said. "I was the only Mexican on the team in the U.S. and I just felt like it was amazing, that product."

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Miguel Leal

So how did Leal get the idea to start a Mexican food brand?

According to him, there were several episodes in his life where he contemplated the idea.

One of the first was when he was still in college in Mexico and lived with his grandma.

"She was an old-school Mexican grandma," Leal said, "She would buy things fresh every day. The tortillas, the beans, everything, and just cook. It would be delicious."

But once Leal grew older, he realized not everyone had the time to go buy high-quality ingredients to cook as his grandmother did back in the day.

"I see my kids that are second-generation Hispanic, and, many of my friends from multicultural families, they are all busy, they don't have time to go every day to the market," Leal said.

Then, as he brainstormed what to do, he remembered a conversation he had with Daniel Lubetzky, a friend of his who founded KIND bars in 2017, where he asked himself three simple questions: Why does Mexican food have to be cheap, have fillers and be made of low-quality ingredients?

And so he decided to call Lubetzky and put the idea of making a Mexican food brand to work.

SOMOS is born

"The first thing was, well, we need a name, we need some recipes and we need a team," Leal said.

With the help of Lubetzky and their American wives, Leal was able to get a list of people to hire and a name for the brand that tied both Americans and Mexicans together.

"We wanted a brand that would bring cultures together. And I love (SOMOS), because it has a lot of symmetry," he said.

The word "somos" is Spanish for "we are," and Leal liked that it was a 5-letter word that had perfect symmetry when split in half.

After coming up with the name, Leal and Lubetzky brought in a third friend, Rodrigo Zuloaga, who also worked at KIND and came from a long line of chefs.

"Our first hire was operations, then sales, then finance, and then we were off to the races," Leal said.

Then came the sauce recipe, which Zuloaga worked on from Jalisco, Mexico.

"Rodrigo would send us food in boxes to me at my house," Leal said. "And then we said, Why don't we just do a direct-to-consumer business? These boxes are great.'"

The trio tested direct-to-consumer delivery in 2021, as the coronavirus pandemic ravaged the U.S. The service "tested amazing," exceeding expectations, Leal remembers.

"We were supposed to sell 5,000 cases the first month, and we sold 15,000 cases the first week," Leal said.

From delivery service to grocery store staple

But it would all come crashing down as people began leaving their homes in 2021, and started shopping in stores again.

"We were launching nationally and it was very tough," Leal said. "It was a huge failure financially. It was brutal."

But as they slowly pushed to sell their sauces at retail stores in 2021, they began to see some success.

The big break happened when Leal got their products on display at Expo West, the largest trade show for natural foods in the U.S.

"There are close to 90,000 people that come to it. You have about nine to 10,000 different companies that have a stand and have their food," Leal said.

But the retailers were the most important, who were also present at the show.

"You have all the retailers, everybody from, you know, Whole Foods to Walmart, to 7-Eleven, to Albertsons, to Sprouts," he explained. "It is a make-or-break event for us in the food industry."

So Leal and Lubetzky used their food industry connections to get into meetings with the big retailers, who would eventually help scale up their distribution.

"Daniel, myself, everybody in the team would just reach out to everybody that would pick up the phone and give us an appointment at Expo."

And now, three years after starting SOMOS, the company's products span salsas and vegan entrées like rice and beans.

"I love the brand. I love my job. I love the team. So we're, we're going to continue until I retire," Leal said.

Leal was interviewed for Bísness School, a series that tells the inspiring stories of Latino founders. Subscribe to Bísness School wherever you get your podcasts to get future episodes automatically. Remember, business school is expensive. Bísness School is free.