Brian Tate cashed in his winnings to fund the food that fueled his card-playing career. Now Oats Overnight is raking in more than $200 million a year.
Read the full story on Forbes: https://www.forbes.com/sites/martinadilicosa/2025/11/08/this-entrepreneur-made-a-small-fortune-playing-poker-then-he-gambled-it-on-oatmeal/
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:
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.
00:00Today on Forbes, this entrepreneur made a small fortune playing poker.
00:05Then, he gambled it on oatmeal.
00:07Before founding Oats Overnight, 38-year-old Brian Tate spent his 20s as a professional poker player.
00:13He played no-limit events in Las Vegas and private cash games nationwide,
00:17claiming to have banked nearly $10 million in winnings before retiring at 29 to pursue his next venture.
00:23Tate surprisingly focused on the food that fueled his marathon poker sessions,
00:29Recognizing the need to eat well during 12-plus-hour gaming days,
00:33he sought a pre-made version of his homemade oatmeal shakes in 2016.
00:37Unable to find one, he invested $500,000 of his winnings to establish a manufacturing facility in Tempe, Arizona,
00:45launching Oats Overnight.
00:46Tate, the Phoenix-based CEO and owner of just under 50% of the company, expressed his surprise, stating,
00:53I was pretty shocked that it didn't exist because I was enjoying this so much.
00:58I thought I should share it with the world.
01:00I thought it should exist.
01:02Oats Overnight launched in 2016 with three flavors, chocolate, strawberry, and green apple.
01:07The convenience-focused product is cold oatmeal mixed with 20 grams of protein, shaken with milk,
01:14refrigerated overnight, and eaten the next morning.
01:17Early on, Oats Overnight e-commerce director and Tate's longtime poker friend, Thomas Keller, confessed,
01:23I thought he had genuinely lost his mind.
01:26I didn't know anyone who ate cold oatmeal.
01:29But consumers seemed to love it.
01:31This year, Oats Overnight will bring in more than $200 million in revenue,
01:35and Forbes estimates the company, which has struggled with profitability, to be worth $350 million.
01:41The company launched as a direct-to-consumer brand, and within two years adopted a monthly subscription model.
01:49The company incentivizes website visitors to subscribe by offering a free branded Oats Overnight shaker
01:55with their first order and a one-time 25% discount.
01:59Today, the company has 300,000 active subscribers, accounting for 90% of e-commerce sales.
02:08Tate confirms that marketing is the company's biggest expense.
02:11He draws a parallel between poker and his business, stating, quote,
02:15One of the big translations from poker to oats is really focusing on what levers you control.
02:20Tweaking formulas, even adding more sugar or salt, boosted retention by 8-10%.
02:26He grew the flavor portfolio from 3 to 30 retail flavors, plus 30 subscriber-exclusive flavors.
02:33In 2020, they began sending new flavor samples to subscribers who provide feedback,
02:39often via a 100,000-member private Facebook group.
02:42Flavors that gain approval are ranked by retention power.
02:45Poor performers are continually adjusted.
02:48Tate attributes Oats Overnight's 60%-plus customer retention rate to this process.
02:53By 2021, the company had hit $23 million in revenue, and Tate started looking to expand to grocery stores.
03:01However, the transition presented a challenge, as educating consumers without the benefit of visuals like graphics or infomercials would be difficult.
03:09Tate admitted, quote,
03:11We had a lot of concerns about putting that product on the shelf.
03:14We knew customers would probably not understand that it's a spoon-free product and make it in a bowl.
03:20So, he approached retailers with a new idea.
03:23A pre-fill disposable cup with a fill line for water or milk.
03:28Wegmans was the first major chain to distribute the product nationwide,
03:32followed by Whole Foods in 2021 and Walmart in 2022.
03:36By 2023, sales hit $100 million, with retail accounting for 30% of revenue.
03:44Since then, Oats Overnight has expanded to Target, Costco, Sam's Club, and 15 other smaller chains.
03:51To finance that growth, the company raised almost $65 million from several VC and private equity funds.
03:57Tate used $10 million from the latest funding to open a new 310,000-square-foot facility in Westchester Township, Ohio, in September.
04:07This is expected to quadruple output, reduce shipping times by two days, and cut shipping costs by over $3 per box.
04:16Oats Overnight became profitable this year, and Tate does not foresee raising more money.
04:21Remaining funds will be used for facility improvements, equipment, and inventory production.
04:26Tate's gambler's instinct led him to pay Gen Z influencers in 2022 to encourage TikTok users to, quote,
04:33scam Oats Overnight by exploding its money-back guarantee.
04:37With a refund rate of only 1%, Tate calculated the campaign would profitably lower customer acquisition costs,
04:44even if refunds doubled or tripled.
04:47Initially, it worked, dropping customer acquisition costs by 40% within days.
04:52However, the refund requests spiraled, skyrocketing by 500%.
04:57The company took a six-figure loss and had to remove the ads.
05:02Tate summed it up, quote,
05:04We ended up getting absolutely destroyed.
05:06I guess they did scam us.
05:08Still, Tate hasn't backed down.
05:10He says, quote,
05:11I still believe that's a win, and I still look for those opportunities.
05:15For full coverage, check out Martina De La Cosa's piece at Forbes.com.
Be the first to comment