Inside The Billion-Dollar Red Sauce War: Carbone Vs. Rao’s

Forbes

Eric Skae ran the best-selling pasta sauce business for the legendary Rao’s restaurant until the company was sold. Now as the CEO of Carbone Fine Food, he’s done it again—building a $100 million competitor and a simmering rivalry.  Read the full story on Forbes: https://www.forbes.com/sites/chloesorvino/2025/09/19/inside-the-billion-dollar-red-sauce-war-carbone-vs-raos/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, Inside the Billion Dollar Red Sauce War, Carbone vs. Raos.

00:08Eric Skay sits at the back corner table inside New York City's Carbone as a plate of spicy

00:14rigatoni vodka comes out, and he pauses to acknowledge the sauce that launched his business,

00:19Carbone Fine Food. Skay, the 61-year-old CEO and a co-founder, says,

00:26quote, After 35 years, I've done everything you can do, but this one in particular,

00:32I did want to do it better than I've ever done anything else.

00:36Skay runs the consumer packaged goods spinoff of the iconic Greenwich Village restaurant

00:41that has since launched eight outposts, including in Las Vegas, Dallas, Hong Kong, and London,

00:47as well as a soon-to-open location in Dubai, since it was founded in 2013 by a major food group.

00:53A dinner at Carbone can cost hundreds of dollars, but Skay has the task of selling more affordable

00:59access. With a $7 to $11 jarred sauce, any night at home can feel like you're at the flagship

01:06restaurant. That's propelled Carbone Fine Food to become the fastest-growing pasta sauce brand in

01:13America, with sales expected to reach $100 million by the end of this year, nearly doubling 2024's

01:19performance. It's also why Skay is getting calls from grocers as far away as Latin America,

01:25even though Carbone has no location south of Miami. But Skay, who previously ran the retail business for

01:32another New York red sauce cathedral, Rayo's in East Harlem, and led its 2017 acquisition,

01:39is enjoying his second act. Carbone Fine Food's 18 sauces, from arrabiata to pizza sauce,

01:45are now sold across 27,000 stores in America, and he's hungry for more expansion.

01:51Since its founding in 2021, Carbone Fine Food has become the second-largest tomato sauce in the

01:57natural channel of grocery stores, behind Skay's former employer, Rayo's, which has revenue of $1

02:03billion but has not been growing as quickly. Carbone Fine Food is also seventh across all retailers,

02:09behind value brands like Prego, Classico, Bertolli, and Hunt's. Skay says he won't stop until Carbone Fine

02:17Foods has the top spot. Skay, who believes sales will one day reach $1 billion, says, quote,

02:25This will be the number one brand in America. That's what I expected for Rayo's, and Rayo's was where we

02:31were when I was forced to sell it, and it's number one today. For the past year, around 154,000 new

02:39households purchased a jar of Carbone sauce each month. Carbone Fine Foods' household penetration

02:45is still small, at around 2.7%, but Skay says he is closing the gap with Rayo's, which has 23.7%

02:53of the market share. He says, quote, It's me against Rayo's, yet we're both propelling this category

03:00to premiumization. The tomato sauce aisle was already fairly crowded before Carbone joined the

03:06fray, with $4 billion in annual sales and more than 500 brands sold nationwide. The bevy of

03:13startups that have launched in the past few years include a hot sauce extension from Truff, founded

03:19by two Forbes 30 Under 30 alums, a line from the New York City restaurant Ruby Rosa, as well as the

03:25Cavu-backed SAWs, with $21.8 million in investor funding. The momentum in the category is also fueled

03:33by Sovos Brands, which owns Rayo's, getting acquired by Campbell's for $2.7 billion in 2024, in an all-cash

03:42deal. At the time, Campbell's reported that Rayo's sales increased 37% from the previous year,

03:48generating $775 million in revenue, quote, as it continued its march toward becoming a $1 billion

03:55brand. Back in 2017, Skae led the deal to sell Rayo's to Sovos, backed by the private equity firm

04:03Advent International, which rolled up Rayo's with yogurt brand Noosa and pancake and waffle mix brand

04:09Birch Benders. Advent took the business public in 2021 at a $1.1 billion valuation.

04:15Carbon Fine Food could get acquired for two to three times its sales, but Skae says he has little

04:22interest in selling. Forbes estimates Skae's minority stake in the business at 5%. The rest is owned by

04:29the partners of Carbon's management company, Major Food Group, Mario Carbon, Rich Torisi,

04:35and Jeff Zalasnik, as well as one outside investor. For full coverage, check out Chloe Sorvino's piece

04:42on Forbes.com. This is Kieran Meadows from Forbes. Thanks for tuning in.

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