Seventh Generation: Alan Newman and Jeffrey Hollender. A Partnership that Flourished—until it Failed. (2021)
with Alan Newman and Jeffrey Hollender
Executive Summary
Alan Newman and Jeffrey Hollender revisit the growth of Seventh Generation, the breakdown of their partnership and each founder’s later work. The conversation follows catalog and retail decisions, periods of financial pressure, workplace practices, board relationships and the difference between product benefits and environmental ambitions. Revenue, acquisition values, reasons for departures and assessments of other people remain their historical recollections or the host’s reported account.
Key Takeaways
Takeaway 1
Newman describes a tendency to say yes as both useful and costly. It created opportunities but could also exceed his capacity. That is a personal pattern, not an instruction to accept an unfamiliar business without diligence. Examine the resources, liabilities and work behind an opportunity before deciding.
Takeaway 2
The founders describe learning to explain product benefits to consumers and commercial value to retailers rather than leading only with a mission. Their health, safety and environmental positioning is not independent proof of those claims. Customer relevance matters alongside substantiation and clear, compliant communication.
Takeaway 3
Newman recalls encouraging staff to surface mistakes rather than hide them, including a prize-based ritual. The general aim is learning without fear. Any practice should avoid humiliation, protect sensitive information and separate honest error from misconduct; rewarding every mistake without context can create the wrong incentives.
Takeaway 4
Hollender describes moving away from the catalog toward wholesale despite the catalog’s large share of sales. It was a consequential company-specific choice, not evidence that founders should bet the company whenever a channel appears promising. Test demand, cash needs and operational consequences before abandoning a working route.
Takeaway 5
Hollender questions whether reducing harm is enough for an environmental mission. This is his view about product and business ambition, not a measured comparison that establishes the best environmental choice in every use case. Relevant lifecycle evidence and transparent limits matter more than broad claims of doing good.
Takeaway 6
The founders recount different board conflicts and departures. Their interpretations remain attributed, including views about other people’s intentions. Clear roles, agreements and communication can help expose disagreement, but alignment does not eliminate governance risk or replace actual voting, employment and contractual rights.
Takeaway 7
Each founder describes later work after leaving the company, and the current edition looks back on the relationship. Later success does not prove an earlier decision was right or define a person’s worth. Reported acquisition values and brewery rankings remain historical claims, not independently confirmed current positions.
The Conversation Breakdown
Two restless rebels
Jeffrey Hollender grew up uncomfortable on Park Avenue with a work-obsessed ad-executive father, dropped out of Hampshire College, and built the Skills Exchange of Toronto (30,000 course registrations in year two) before the RCMP jailed and deported him for working without papers. Alan Newman drifted from Long Island to Vermont on a whim - 'most things in my life have not been planned' - and became the finance-and-ops number two at Garden Supply, where he learned catalog culture.
Redemption arcs before the company
Back in New York, Jeffrey's for-profit course catalog taught 'How to Marry Money' - a Phil Donahue appearance left him ashamed - then a books-on-tape venture sold to Warner Publishing for millions (his investor father got a ~$1M check and finally approved of him). He wrote 'How to Make the World a Better Place' on legal pads at the NYPL, researching how business could do good.
A free catalog nobody wanted
Alan's mail-order systems shop served Renew America, an energy-products nonprofit with an indecipherable catalog. When they offered him the whole business free - take it or we throw it out - his mouth said yes against his brain's will. With six weeks to the holiday mailing window he cut the catalog to digest size (bigger-looking photos), added education columns, led with saving money, and renamed it Seventh Generation after the Iroquois principle of weighing impact seven generations out. Orders blew him away.
Capital meets catalog craft
In January 1989 Jeffrey - who had loved the Renew America idea - became partner and capital-raiser; his previous investors, paid back 10x, put in $850K. Jeffrey ran CEO duties from New York, Alan ran Vermont operations with free Ben & Jerry's, a nap room, chalkboards in the bathroom, and the biggest-mistake prize. Products came from co-packers: the famously scratchy unbleached recycled toilet paper, and French string shopping bags whose 100,000-unit backorder broke their five-digit COBOL system and triggered a ~$120K customs penalty.
Rocket ship, then the Gulf War
A 1989 New York Times mention and the 20th Earth Day anniversary took sales from $1M (1989) to $7M (1990), with a four-page People magazine feature. Then recession plus the Gulf War glued America to its TVs: orders fell from 1,200-1,500 a day to under 100. Half of the 120 staff were laid off - Alan spent a Saturday party knowing he'd fire most attendees on Monday.
The sabbatical and the Dear John letter
Exhausted after years of 80-120-hour weeks, Alan proposed a six-month sabbatical in January 1992 to recharge and rethink the business. Jeffrey, feeling abandoned on a sinking ship and prone to holding grudges, answered his return email with a letter ending his time at the company. Nothing about the sabbatical's terms had been written down - both now name that as the fixable failure. Alan leveraged an IPO share lockup to force a buyout (~$200K for his ~23%), and marriage-counselor-style mediation sessions failed.
Two second acts and a reunion
Jeffrey pivoted Seventh Generation from catalog to wholesale, sold the catalog in 1995, won Whole Foods in 1998, donated Albertson's profits to a workers' strike fund, and grew toward $150M - until the board fired him by phone on a Saturday in 2010, the company's best year. Alan's Magic Hat, run 'as a music company,' became a top-10 craft brewery before the 2008 recession forced its sale. In 2016 Unilever acquired Seventh Generation (reported ~$600-700M) and invited Jeffrey back to the board; in 2021 the two founders finally told the story together, agreeing the company would have been stronger had they found a way to stay.
Core Frameworks & Ideas
Strength and constraint review [editorial synthesis]
Ask how a useful personal tendency can also exceed capacity or impair judgment. Decide which safeguards or colleagues are needed rather than declaring the tendency universally good or bad.
Relevant and substantiated benefit [editorial synthesis]
Explain what the intended buyer values, including retailers’ economics. Verify performance, health and environmental claims instead of treating persuasive positioning as evidence.
Safe error reporting [editorial synthesis]
Create a route to disclose mistakes and learn without humiliation. Protect confidentiality, offer independent escalation and distinguish learning from the handling of misconduct.
Environmental claim boundary [editorial synthesis]
Separate reducing a measured harm from a broad claim of creating good. Investigate lifecycle impacts, scope and tradeoffs before describing a product as sustainable.
Actionable Next Steps
- ✓Put roles, time away, disagreements, exits and governance expectations into an agreement reviewed by qualified counsel.
- ✓Test the next channel at a scale the company can supply, recording demand, cash needs and operational work.
- ✓Understand the retailer’s relevant economics and support the pitch with accurate, substantiated product claims.
- ✓Compare supply plans with actual repeat demand and service commitments; do not manufacture scarcity or mislead customers.
- ✓Try a safe, nonhumiliating way to share learning from mistakes, while keeping sensitive reports and misconduct on appropriate private routes.
Notable Quotes
“my brain is saying no no no no no and out of my mouth comes I'll take it”
“I find that saying yes opens doors”
“the greatest obstacle to success was fear”
“the truth was we sold health and safety first, environment second”
“being less bad is not being good”
“not only was I let go, but I was let go over the telephone on a Saturday morning and told that I wasn't even allowed to go back into the office ever again.”
“if you're not prepared to do the work, you shouldn't get into the relationship”
The One Thing to Remember
Clarify partner roles, disagreements, time away and exits in a written agreement before a difficult situation tests the relationship.