40,000 acres of pistachios (zero customers)

Hey there,

Welcome to the Income Ivy Newsletter.

Think you need customers before you build your business?

Most entrepreneurs do. They test demand, run surveys, validate the market. Smart, right? But here's something that might surprise you: Stewart and Lynda Resnick planted 9,000 acres of pomegranate trees in 1987 when virtually no Americans drank pomegranate juice.

Zero market research. Zero proven demand. Just thousands of acres of trees that would take years to produce fruit.

By the time the pomegranates were ready to harvest, they'd spent millions and still had no customers. So they created the customers. POM Wonderful now generates over $500 million annually selling a fruit most Americans didn't know existed 30 years ago.

The craziest part? This backwards strategy of building massive supply before creating any demand is how some of agriculture's biggest fortunes get made.

POM's $100 million bet on fruit nobody wanted

The Resnicks owned thousands of acres in California's Central Valley in the 1980s. They needed a high-value crop that could thrive in their climate.

Pomegranates seemed promising. High antioxidants. Ancient superfood history. One problem: Americans had no idea what to do with them.

Most entrepreneurs would have planted a test acre. Maybe run some focus groups. The Resnicks did the opposite. They planted 9,000 acres knowing it would take 3-5 years before the trees produced anything.

That's millions of dollars spent before selling a single pomegranate.

When harvest time came in the early 2000s, they had tons of pomegranates and nowhere to sell them. So they created the market through aggressive marketing. Medical studies on antioxidants. Celebrity endorsements. Those distinctive curved bottles in every grocery store.

They didn't just sell pomegranates. They sold the idea that pomegranates were essential for health. POM Wonderful became a $500 million brand by creating demand for their massive oversupply.

Driscoll's berry empire built on future farming

Here's one that goes back even further: Driscoll's started in 1904 when R.F. Driscoll began developing new strawberry varieties in California.

But Driscoll did something radical. He contracted with farmers years in advance to grow berries using his proprietary plants, long before knowing if customers would pay premium prices.

The traditional model was: see what sells, then grow more of it. Driscoll's model was: develop the best berries possible, grow massive quantities, then convince customers they're worth premium prices.

Driscoll's spent decades breeding sweeter, more durable berries. They planted them at scale across thousands of acres. Only then did they market them as superior to regular strawberries.

The bet paid off spectacularly. Driscoll's now controls one-third of the U.S. berry market and generates over $3 billion annually. They created supply first, then created the premium perception to match.

Wonderful pistachios' California gamble

Stewart Resnick strikes again. In the 1970s and 1980s, he bought thousands of acres in California's Central Valley to grow pistachios.

At the time, pistachios were imported from Iran and viewed as exotic, expensive nuts. The domestic U.S. market barely existed.

Resnick planted 40,000 acres of pistachio trees anyway. Pistachios take 7-10 years to produce nuts. That's nearly a decade of investment before any revenue.

By the late 1980s and 1990s, Resnick's trees were producing tons of pistachios. But Americans weren't buying domestic pistachios because they didn't know they existed.

So Resnick created one of the most memorable marketing campaigns in food history. "Get crackin'" ads featuring celebrities. Distinctive green packaging. Relentless brand building.

Wonderful Pistachios now dominates the U.S. market with over $1 billion in annual sales. They created the domestic pistachio industry by building supply before demand existed.

The backwards strategy that works

Here's what these three understood: If you build it first at massive scale, you have the resources and motivation to create the demand.

Small supply means small marketing budgets and weak market power. Massive oversupply means you either create demand or lose everything. That urgency funds bold marketing.

POM spent millions on medical studies because they had millions of pomegranates to move. Wonderful ran Super Bowl ads because they had billions of pistachios to sell. Desperation funded domination.

How to apply supply-before-demand thinking

Commit before it's comfortable

These farmers spent millions before knowing if anyone would buy. That commitment created the urgency to make it work. Tentative tests rarely create breakthrough results.

Use oversupply to fund education

When you have massive inventory, you can afford to educate the market instead of just advertising products. POM taught Americans about antioxidants. That education created lasting demand.

Build before competitors can react

Long production cycles or high capital requirements create moats. By the time competitors see your success and try to copy, you've already achieved unbeatable scale and brand recognition.

Create the category, not just the product

Don't just sell pomegranates. Create the superfood category. Don't just sell berries. Define what premium berries mean. Category creation justifies premium pricing and builds lasting moats.

The conventional wisdom says validate demand before building supply. Test small before going big. Minimize risk at every step.

These agricultural entrepreneurs did the opposite. They bet everything on crops nobody wanted, then used that massive commitment to create the markets that made them fortunes.

Sometimes the riskiest move is actually the safest one. Because when failure means losing everything, you find ways to succeed that cautious competitors never discover.

What could you build before demand exists?

Emil | Founder of Income Ivy