Building on Frozen, Mom-Tested Italian Treats, Entrepreneur Thrives

Michael Angelo Renna sat in his cramped Carlsbad office, describing the recipes used in Michael Angelo’s Gourmet Frozen Foods, a new power on the national frozen food scene. He talked about the natural ingredients and the freezing process, and then he paused.

“Mom, are you there?” the 27-year-old shouted over his shoulder.

From behind a bookshelf-wall came a reply from Sara Lochrie, Renna’s mother and quality-control expert. She appeared wearing a white smock stained with Italian sauce.

Truly Homemade

While “homemade” is little more than a casual reference for some food vendors, all Michael Angelo’s recipes originate from Lochrie, who developed them from those of her mother.

“He (Renna) keeps me innocent,” said Lochrie. “I’m not concerned with prices or anything else--just the quality.

Truly a family business, Michael Angelo’s Gourmet Foods has grown from its beginnings in the back of a tiny Solana Beach pizzeria into a $10-million-plus a year national venture in a little more than five years. It has carved out a niche in the highly competitive, high-end frozen entree market.

Michael Angelo products are sold in convenience stores and such major outlets as Big Bear, Alpha Beta and Price Club, with entrees priced in the $2.50 and above range. A box of two, 6-ounce calzone usually retails for about $2.69.

“The real growth in the industry has been in the lower prices, like ‘Budget Gourmet,’ ” said Sarah Stack, vice president of research for the Los Angeles-based brokerage firm of Bateman Eichler, Hill Richards. “The high end is getting competition from fresh, refrigerated entrees and the speciality stores.”

Taste is the most important variable, Stack said.

“The big beef for consumers of frozen entrees is that they just don’t taste that good,” she said. “People are not going to pay up for food labeled gourmet that doesn’t deliver taste.”

If taste is indeed the key to success in the frozen food industry, than Renna’s mother must be doing something right. The company now employs more than 125 and is moving into a new, 50,000-square-foot facility in Vista in September.

“I just like to entertain and feed people,” said Lochrie, recalling the pizzeria. “I never thought it would come to this.”

The only person who conceived of Michael Angelo’s developing into a frozen-food giant was Renna.

In 1982, he talked his three brothers into turning over control of Dino’s, the family’s 600-square-foot, two-table pizzeria, to him. “They were so happy to get out they couldn’t run fast enough,” said Renna.

But a career in the retail pizza business was not what Renna had in mind.

“The restaurant business is like baby-sitting,” he said. “You’re there morning, noon and night waiting for people. I can’t see why someone would want to live like that.”

Renna, who grew up in Connecticut, was always creating business ventures, from an automotive repair business to lawn-care centers.

Soon after he took over the family pizzeria, he convinced an old high school friend, Dennis Colletti, his girlfriend (now his wife), Cindy Cox and another friend, Joe Ianessa (now out of the business), to work nights making stuffed shells, eggplant Parmesan and lasagna for distribution to local stores. After they were done cooking, they would deliver the entrees to Rancho Market in La Costa and La Jolla Shores Market, their first outlets.

Mom’s Own Recipes

The recipes were straight from Renna’s mother. She didn’t have set recipes, so Colletti and Renna would watch her cook and take notes. Colletti remembers having to grab her arm sometimes so he could measure the ingredient before she put it into her creation.

“I would take some food up to her house every couple of days to see if we were making it right,” said Renna.

Jim Wadley, who owns the Santa Fe Clothing store near where Dino’s was, remembers being impressed at the hours Renna and his associates put into the new business. “If I worked to 1 p.m., they’d be working, and, if I came in at 5 a.m. they’d be working,” said Wadley, who later invested in the company.

When more stores started to sell the entrees, and the food started melting before they could deliver it, Colletti, who attended school in Florida to become a turbine engine mechanic, fixed up an old truck. Then he became the official truck driver for Michael Angelo’s.

Renna said he devoutly funnelled all proceeds back into the company, which drew a laugh from Colletti. Renna paid employees, even the partners, only what they needed to survive, Colletti said.

“We had to bring in our bills in order to get paid,” he said.

Big Bear was the first major market chain to take a chance on the entrees, which were loosely packaged in plastic containers. Four types of Italian entrees were placed in Big Bear stores in Mira Mesa, Del Mar and Jonathan markets (part of the Big Bear chain) in Rancho Santa Fe and La Jolla.

At first, Michael Angelo’s offered large portions, 20- and 28-ounce packages, priced in the $5 and $6 range. But it switched to smaller portions--and smaller prices--”in order to be more competitive,” Renna said.

Soon Renna sold off the Solana Beach pizzeria and a second retail outlet in the Surf and Turf Recreational Center in Del Mar. When Alpha Beta decided to put the entrees into more than 200 outlets nationwide, it was clearly time to expand.

An accountant friend advised them on how to organize a private stock offering, which raised $100,000 in 1983. A $100,000 loan from the Small Business Administration provided more working capital.

Wadley, who said he has yet to receive any profits from his six-figure investment in the company, is chairman of Michael Angelo’s board of directors. The co-owner of the Bill Gamble’s retail clothing chain, Wadley guaranteed the early loans to the company, but “now the company has moved beyond that” and doesn’t require his guarantee, he said.

Despite the lack of return, Wadley is impressed with Renna and the huge strides made by the company. Renna was the Small Business Administration’s San Diego Young Entrepreneur of the Year recipient in 1987.

“He has learned a hell of a lot,” Wadley said of Renna. “He has a marvelous ability to listen to older heads, take in all the information and then put it into his game plan.”

Price Club warehouses have become one of the biggest outlets for Michael Angelo’s, Renna said.

“They come at us with good quality ingredients,” said Roman Braun, vice president of food buying for the West Coast Price Clubs. “The customer is looking for quality. They don’t fall for the chicken pie thing anymore. It’s a more educated market. They want high-quality products with no preservatives.”

Michael Angelo now markets 11 products, five entrees and six styles of calzone, four of which--Philly steak, ham and cheese, meatball and vegetarian--will enter the market in the next month. All are made from completely natural products, Renna boasts.

Full-time quality control expert Lochrie said she develops all the recipes from scratch. She recently won a gold medal at the State Fair in Sacramento for Michael Angelo’s lasagna, competing against chefs with fresh products from restaurants.

Lochrie said she gets all her ingredients specially delivered, including fresh cheeses. They even grind their own meat.

“I used to see little pieces of things that look like rubber bands in the meat,” she said. “That’s when we started grinding our own meat.”

As for the rest of the market, “it really hasn’t come that far from Swanson’s,” said Stack of Bateman Eichler, Hill Richards.

“They (Michael Angelo’s) should also benefit from their narrow focus, because people like Italian food, but most companies don’t have a full line of Italian entrees.”

Looking ahead, Michael Angelo’s is preparing to release its new calzones. Renna also hopes to move into the institutional market, distributing to restaurants.