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Blaine Bolus
00:00:05 - 00:00:49
Hey everyone, we're super excited to announce the launch of our Slack community for D two C pod. This is a space exclusively for D two C founders and operators to connect, share ideas, ask questions and support each other. You'll be able to engage with the best minds and operators and consumer and currently we're on a waitlist and it will open up the community once we reach 150 members. So apply using the link in the description and we hope to see you on slack. So before we kick off today's review recording, ive got one more for you. Keeping up your momentum this year starts with the right selling tools and if youre looking to increase revenue, grow faster, build more pipeline and close more deals, check out the all new sales hub from HubSpot. Youll be able to manage your whole sales process. Plus my favorite part, the reporting, its super intuitive, powerful and customizable.
Blaine Bolus
00:00:50 - 00:01:36
Plus the whole thing is powered by AI so your teams can spend less time on tedious, time consuming stuff and more time on developing relationships. Also, no one likes a clunky platform that takes months to onboard onto. But getting set up on saleshub is really quick and easy. It's free to get started. The pricing will scale with your business, and with more than 1300 integrations and add ons you can tune it to your exact needs. Visit HubSpot.com sales to start selling with sales hub what is going on? DTC pod today we have the pleasure being joined by Chris Hunter, who is the co founder and CEO of Koya. But before that, you might be familiar with Chris because he was also one of the founders of popular drink for Loco. So, Chris, I'll let you kick us off.
Blaine Bolus
00:01:36 - 00:01:48
Why don't you tell us a little bit about your background in the consumer products space, how you got involved, how you started for a loco, and then maybe we can move over into Koya and what you guys are building there.
Christopher Hunter
00:01:48 - 00:02:05
Yeah, sounds great. Thanks for having me. Appreciate you inviting me on. Let's see, I guess. I guess my journey started. I grew up in Ohio and in Youngstown, Ohio, if you know anything about that. It's a blue collar steel mill town. And so I grew up in a lower middle class family.
Christopher Hunter
00:02:05 - 00:02:33
No one was really entrepreneurs. I had one uncle who owned a company, so it was kind of cool to see him kind of pave his own way. But I always realized I wanted to do my own thing. Whether I was just like a look, I was a good kid, but whether I was rebellious and I didn't like being told what to do. So I was like, I'm just always going to start, start my own thing. Plus, I wanted to have the biggest opportunity to create the most money possible, you know? But I didn't know what that meant. And so I went to Ohio State. After college, I moved to Chicago.
Christopher Hunter
00:02:33 - 00:03:11
I had no job. I didn't know what I was going to do was racking up debt, and I took whatever job I could find. I started working in a hail damage, like, storm chasing company, and it paid the bills. I realized that wasn't going to be long in that career because I was afraid of heights. So it didn't work out that well. But during that time, I just started contacting everybody I could think of, and, and I was like, what job do I want to do? Like, what would I, what would my skills be good at, right? I'm a pretty social guy. I'm pretty outgoing. I did promotions for nightclubs and bars in college and around the country around that time.
Christopher Hunter
00:03:11 - 00:03:48
And so I had met somebody in the alcohol industry, and I just bugged the hell out of them until they let me stop, start working for them. And so that's how I cut my teeth in alcohol and in beverage. And it wasn't really by design. It was just like, this is the opportunity. And I realized I was good at it and I liked it, and there were a lot of social benefits to working in that industry. And so after two years, I was just trying to think of what I wanted to do, and I had this inspiration. I was selling this cherry flavored vodka that was often mixed with Red Bull and cherry bombs. I was 24 at the time, you know, very made sense to me.
Christopher Hunter
00:03:48 - 00:04:10
Right. I was the Courtney. And so I was driving around. Well, like, part of my job was I would drive around to bars and basically pitch them this vodka. And then there was this, like, Red Bull knockoff product that I had as well. And I was kind of showing them how to make a cherry bomb. And it just dawned on me. I was like, why don't we have a premixed alcoholic energy drink? And so that's what sparked the idea.
Christopher Hunter
00:04:10 - 00:04:40
I caught up my two partners separately and asked them if they were interested, and they said, yeah, why not? And we gave it a shot. And, and that was the birth of what became four Loko. It didn't start. As for loco, through some iterations and failures, we, we innovated and created for Loko. But, um, look, it was a lot of fun. It was a rocket ship ride. We clearly learned a lot about crisis management during that process. And, and looking back I mean it was the best, you know, learning, growth experience I could ever have.
Christopher Hunter
00:04:40 - 00:05:10
I wasn't uh, I didn't go to grad school. I wasn't like trained as a, as a leader or whatever in that way. We were just winging it, or at least I was. And um, I think it worked for the most part. And then um, after we navigated that whole kind of government regulation issue, we stabilized the company. I really like the focus on innovation and things that are near and dear to me. And so uh, we created this brand called not your father's root beer, which started this hard soda movement. We sold that to Pabst and, and I was a little older at that point.
Christopher Hunter
00:05:10 - 00:05:39
I was in my mid thirties, married, had children. My second son was born dairy intolerant. My wife is a nutritionalist. Shes very like adamant about what makes it in our house. And so we started, you know, trying to figure out what was going on with our son. You could hear his stomach rumbling and we realized he was dairy intolerant. So we became a dairy free household, which ultimately led to coia, which is, you know, plant based, dairy free, uh, protein drinks. So that's the quick version that, that brought us up to this point.
Blaine Bolus
00:05:40 - 00:06:04
Awesome. So we're going to have a whole bunch to cover here. Um, but yeah, let's, let's jump into Coia. And then I definitely want to revisit some of the lessons that we learned along the way from for Loko. So, um, you know, just to set the stage for the listeners, uh, why don't you tell us in terms of like, like what's your scale, uh, in terms of Coia right now, in terms of sales, where is your product sold? Like just, just set the table for us, if you will.
Christopher Hunter
00:06:04 - 00:06:25
Yeah. So Koia is currently available in about 30,000 retail locations across the country. We're primarily retail focused. We've dabbled in d two c a little bit. We could talk about that in a minute. We do over 100 million in retail sales, so it's reached a really nice point. It's still growing. We're unlocking a couple key partners.
Christopher Hunter
00:06:25 - 00:06:39
We just launched in Starbucks nationwide at the end of last year, but we're available everywhere from Whole Foods to 711 across the country. So that's been really exciting. And again, primarily retail focused.
Blaine Bolus
00:06:39 - 00:07:14
Yeah. And one thing that I'd love to talk about is obviously you have a pedigree from working in the beverage sort of industry for a while now, but I'd love if you could tell us a little bit about the trajectory of the business in terms of going from the first kind of time you had the idea you've got a problem to solve. Walk me through what the product, product development cycle looked like. And then how quickly did you scale? Because like you're saying right now, you've got tons of the biggest, biggest retailers across the US. But was this a quick thing where you had a couple turns on product and then boom, you were instantly everywhere? Or was it a slower sort of grind?
Christopher Hunter
00:07:14 - 00:07:55
Yeah. So going back to the original kind of like involvement with this company. So as I was transitioning out of actively managing fusion projects, which is the parent company of, of, for Loko, I was starting to invest and better for you food and beverage brands, and there was this startup company called Raw Nature five in Chicago, and these two entrepreneurs that I invested in with some other people, and they were in about 20 stores around the Chicago area. And it was really good proof of concept. I mean, the name was bad, right? Raw Nature five was not really a good name. I don't think the packaging was like one of the co founders had created himself. But, but listen, it didn't matter. He got the product out and it was working.
Christopher Hunter
00:07:55 - 00:08:22
And I think why it was working was it just tasted really good. So all these health attributes are great, but if it doesn't taste good, people just aren't going to drink it. So for me, that was why I invested in the company. Now, fast forward a few months, and the company was on the verge of insolvency. There were a bunch of problems with it. It was being manufactured in a commercial kitchen, self distributed, a very unscalable model. But I was looking for something to do. And this was interesting to me.
Christopher Hunter
00:08:22 - 00:09:00
I mean, it made sense for me and for my lifestyle, for my family. And so I went to those partners and I said, look, I'll invest the money to essentially create a new company, say what we have here, but create a new company. We're going to pivot. I'm going to be the co founder and CEO, I'm going to run it. And they were totally cool with that. And so we launched. So we pulled that original product off the market in, let's call it, I think it was 2015, and it took some months to figure out how to create a formula that was scalable. And by scalable, what I mean is we couldn't produce it in a commercial kitchen where we or our own team are doing it.
Christopher Hunter
00:09:00 - 00:09:28
It has to go out to a co manufacturer, can be produced at scale, right? That was the first criteria. So that's what we focused on. We were burning cash over those months. It was not fun, but that was the first iteration of the product. The next thing that I felt was required is I was new to the non alk industry. I had worked in the alcohol industry. It's a little bit different in terms of structure. It's called a three tier system where there's distributors, the store, and then the end consumer with non algae.
Christopher Hunter
00:09:28 - 00:10:08
I could sell directly, directly to the consumer if I wanted to. Now Coia is a perishable beverage, so it has to be cold at all times. That makes it a little bit difficult to do, to see. But anyways, my point was we had to have some support that legitimized us within the industry. So we got this major broker on board with us. He invested in the company, they represented us nationally and then they helped us pitch total foods. And so we were fortunate that I guess by the second iteration of the product, from raw nature five to Coia, we were able to go national and whole Foods. So it was a pretty big launch, which is amazing, but it's also expensive and a bit scary, right, because this is it.
Christopher Hunter
00:10:08 - 00:10:45
Like, if you don't work at Whole Foods after you got a national launch, nobody's bringing you in, it's over, right? So. So we had to go hardcore at making sure the product worked. And that was expensive and inefficient. But we did demos, we had merchandising teams on board, whatever it may be. And so it quickly proved out that it, that it made sense and we continued to grow through flavor innovation. So we launched with three flavors. We now currently have 14 flavors on the shelf at Whole Foods. So anchoring into that one key partnership was really important because it gave us the story to go pitch other retailers.
Christopher Hunter
00:10:45 - 00:11:22
So we were in 400 stores the first year. We were in, let's call it 1200 stores the second year. We were in maybe 3000 the next year. So it scaled over time until we started to gain these big distribution wins and partnerships with places like Publix and Kroger. And you know, those are thousands of doors at a time. And then most recently Starbucks with 9000 doors. So it took all of seven years to get to 30,000 points of distribution. But I tell you that those early days are so invigorating because everything is a win, man.
Christopher Hunter
00:11:22 - 00:11:31
It's like at one store is a win, right? One chain is a huge win. One point in velocity or acv is a huge win. So, uh, but it takes time.
Blaine Bolus
00:11:31 - 00:12:02
Yeah, absolutely. Um, no that's. That's super interesting. I'd love to, like, kind of double click a little bit, uh, on what you talked about with the Whole Foods partnership. What did it take to launch with them? You said 30 doors or 30 stores to. To get started. But in terms of the, you know, the purchase order that you needed to put in, I know you said you were trying to scale. You were going with three flavors to start with, but from, like, a capital investment, like, what did it take to say, okay, hey, guys, we've got whole Foods ready to go.
Blaine Bolus
00:12:02 - 00:12:12
What does it now take to, like, deliver on that order? I guess from an inventory perspective and an operational perspective, what needed to happen.
Christopher Hunter
00:12:12 - 00:12:42
Yeah. So when we funded the company, we put a half million into it, me and two other guys, when I jumped in as a co founder to pivot this thing, and that was the capital we had to kind of launch with. And we ate it up pretty quickly from inventory. And unfortunately for us, our first production run was sitting in our warehouse waiting to ship the distributor services. Whole Foods is called unfi. Their trucks were literally on the way to pick it up. And my. My partner at that time called me, and he said, man, some of the stuff is spoiled.
Christopher Hunter
00:12:42 - 00:13:22
It was. It was tasting bad, right? I don't. It was never a health concern, so we had to put those trucks on hold. We were standing in a warehouse for 6 hours that day, ripping open boxes to assess how much was spoiled. Was this a one off? Was this all of it? Was it, like, could we figure out how to control it? And it sounds like a long process, but I quickly knew, like, we couldn't put the product out right, so we had to scrap an entire first production run. Luckily, we had loaded up on some of the key ingredients with enough inventory that we could produce quickly, so we. We troubleshooted as best we could. We produced it again, and within the next week, we shipped it out.
Christopher Hunter
00:13:22 - 00:14:05
Now, the reason that's relevant is because retailers do reset periods, and at whole foods at that time, they were turning over their shelves in, like, a week or two. So if you were not in within two weeks, you would be in all of their stores. Well, we missed that window. So, luckily, whole Foods let us still launch, but it wasn't smooth, and so we had to then spend money on merchandisers to go out and make sure it actually made it to the shelf. So it became very expensive to the point where within six months, I was out raising money again. It's expensive. Now, I will say it's nice to work with big partners the AR is golden in most senses. They're paying it back.
Christopher Hunter
00:14:05 - 00:14:15
There are a lot of deductions that we had to work through, but it wasn't like they were going to stiff us. They weren't some small retailer down the street that wasn't going to pay sweet.
Blaine Bolus
00:14:15 - 00:14:41
And then from there, what, what did it look like? Like, tell me about how the initial launch went with Whole Foods and then how long before you were like, okay, we've got proof of concept. We, you know, people are happy with how things are going at the whole foods, and now we can start to scale out to other retailers. What was that like? Was it a year? Was it a couple months? Was it a couple years? Like, how long did it take to go from Whole foods to then saying, okay, we've got this sorted, now we can start even scaling beyond.
Christopher Hunter
00:14:41 - 00:15:31
So our plan initially was, and it was very common at that time, was to get into the natural segment so the whole foods, the sprouts, whatever it may be of the world, and to really solidify your position there. And then maybe a year to go to the specialty retailers, like the Wegmans of the world or whatever, and then maybe year three, go to the conventional retailers, like Publix or Kroger or whatever. And within the first six months, that plan blew up in the best way possible. We were very hands on at Whole Foods. Like I mentioned, we were also doing a lot of in store demos, because in beverage in particular, I think in food or beverage, like, if you believe your product is good and people are going to like it, then you have to get them to taste it, right? And in the beverage world, they call it liquid to lips. So we were getting liquid to lips no matter what we had to do. And that worked. And our velocities were really high.
Christopher Hunter
00:15:31 - 00:16:16
And so we had this great selling story to the point where other retailers started to reach out to us. So we got reached out to by Wegmans, which is a great retailer, but you would call them a specialty retailer, right? So that wasn't really our plan for year one. It's pretty hard to say no to these really good retailers, you know? So we launched in Wegmans, I want to say, within six months. And then the third retailer we launched in was a very traditional retailer called Giant Eagle. And like I said, I grew up in Ohio. That was kind of our hometown retailer. There was really no organic or better for you section, at least when I grew up there. And so I was a little bit hesitant about launching there, but we had an investor and a board member, a guy named Bill Moses, who started Kavita and later sold that to Pepsi.
Christopher Hunter
00:16:17 - 00:16:42
And he was close with them, and he said, I'm setting up a meeting. And so we went and had the meeting, and they said, look, Bill has never steered us wrong. This seems like a good idea. We'll give it a try. And I was holding my breath. I was a little bit worried about it at Giant Eagle, but luckily it worked really well there as well, and still does to this day. And so my point in saying all of that was we had this very pragmatic plan of expansion that would take three, four years. And within the first year, we blew it up.
Christopher Hunter
00:16:42 - 00:17:01
The good side of that was we had a proof point in every channel of retail, or most channels of retail, that it would work. And so now it gave us a broader, like, hunting base. We could go after all natural retailers, all specialty retailers, all conventional retailers, with a story to show how it worked and. And that it would work in their retailer as well.
Blaine Bolus
00:17:02 - 00:17:23
Awesome. And I'd love if you can talk to us a little bit about supply chain and the operations. Were you just manufactured? Did you have one single manufacturer who now is distributing across the US? Or how did you think about scaling for scaling out the supply chain and making sure shipping, delivery and orders and everything were syncing up?
Christopher Hunter
00:17:23 - 00:17:50
Yeah. So we brought in a couple of people very early that could help us with that. We had this amazing woman, her name's Nid, who joined our company with a food science and formulation background. And she ultimately wanted to expand into operations. And so we were lucky because she helped us troubleshoot that early batch that spoiled. And then she handled ops. We had. There was one co manufacturer that we worked with out in Anaheim, and that's who.
Christopher Hunter
00:17:50 - 00:18:09
That was our sole source for a while. It's not ideal from a location standpoint, to ship to the east coast. About 60% of our sales are coming from there. But there weren't many people who could produce what we make, which is a low acid. It's called ESL, extended Shelf life product. And so we didn't have that many options. So we worked with them. They were good partners.
Christopher Hunter
00:18:10 - 00:18:38
As we grew, they grew. They acquired and opened a second facility. And then over time, we had moved away from them into a different facility. And then that facilitated us having the opportunity to buy their second facility. About 20 months ago, we vertically integrated, bought our own manufacturing facility, something we said we never wanted to do. But after Covid, it became apparent we needed to do it. And we've been producing all of our own products since then. I'll tell you that we didn't take that lightly.
Christopher Hunter
00:18:38 - 00:19:06
We were told by all of our investors it's a big project. It takes a lot of time. It's going to take more money than you expected. We thought we were pretty conservative in our projections, and we still weren't conservative enough. You know, it's. It's not to be taken lightly, but at the end of the day, it allowed us to kind of control our margin structure, control our production schedule. We built out our own warehouse, and so we have refrigerated warehouse on site. So that gave us the flexibility to do some things.
Christopher Hunter
00:19:06 - 00:19:30
Like, had we not done that, we would not have been able to launch in Starbucks because they have different requirements. So, I mean, it's. It's everything from the facility itself to the partners with the, you know, ingredients. I mean, we had raw materials. Some of them were long lead times. And so. So it's really just. It was really just a lot of communication and working closely with them and in some cases, working inefficiently.
Christopher Hunter
00:19:30 - 00:20:03
I mean, we might have three months worth of a key ingredient because we knew it was an at risk ingredient. Now, as we've grown over time, we try to put redundancies in place, redundant facilities, redundant suppliers for materials, because we, you know, we can't be caught. The worst thing is if you don't have product to sell, right? So. And through that journey, we ventured into different things. Like, you know, early on, we. Everything was d two c. And so we said, we. We better launch d two c, even though we have the double whammy.
Christopher Hunter
00:20:03 - 00:20:32
We're expensive to ship because we are a heavy beverage and we're refrigerated. So you have to ship overnight or today. We said, but customers want it, so we're going to do it. So we did it. It seemed to be good. Good is subjective, I guess. Like consumers liked it. When I started to dig in and talk to our team, 80% of our marketing team's time was being taken on customer service for d two c orders.
Christopher Hunter
00:20:32 - 00:21:08
When I looked at the revenue was generating, I said, this doesn't make sense, and we shut it down. Well, then Covid hits, and now everyone's back on d two c. So we're like, okay, fire that back up. And so we did that again. And then we shut that back down. So we really focus on point of purchase at retail. I will say, as we've grown and the product has become more ingrained in the consumers habits, the number one request we get is to buy the product in bulk and the number two request we get is to get it delivered. That kind of changed what we're doing as a company in a couple ways.
Christopher Hunter
00:21:08 - 00:21:49
I'll talk about our core product, meaning our twelve ounce refrigerated product that you see on the shelves and all the retailers I mentioned, there's an opportunity for us to deliver that through Instacart or Gopaw for seven now or all these delivery things so you can get it delivered. Well, how are we going to address this buy in bulk issue? So we're in the process of selling in multi packs. So four packs for the consumer. Those should be in Whole Foods and then Costco soon. And then we looked at multi serve. So, you know, there's 32 ounce bottles coming out and some retailers. So we were addressing that problem in one way. But it really opened our eyes to like, you know, we're missing this whole marketplace on Amazon.
Christopher Hunter
00:21:49 - 00:22:07
We found out we have 5000 searches a month for Koya on Amazon and we are selling zero of them because we don't have a product to offer. So actually this month we're launching a shelf stable tetra pack version of Koia on Amazon that'll come in twelve packs. And so we're really excited about that because it's what consumers told us they want.
Blaine Bolus
00:22:07 - 00:22:22
And could you go into a little bit more detail about the product that you're actually launching on Amazon? What is it? How many skus are you launching to start with? And yeah, what are you expecting from the Amazon launch?
Christopher Hunter
00:22:22 - 00:22:46
So we based it on our exact product. What we realized is we didn't want something completely different. Customers are asking for what we have but in a shelf stable product or version that they can load their pantry with. Right. So the flavors are the same. They're cacao bean, vanilla bean, chocolate banana. Now what we did do is we bumped up the protein a little bit. So it's going to be 20 grams of protein versus 18.
Christopher Hunter
00:22:46 - 00:23:25
We fortified it with vitamins and minerals and it's coming in a twelve pack. And so we expect to convert all of those 5000 searches and then we expect to kind of change the protein game on Amazon. What I mean by that is if you look at other products out there that are competitive, that are like typical protein drinks. We don't call ours a protein drink like we're not a protein drink, we're a coia. And there's a difference. When you look at those products, they're simply protein and water and they're usually the cheapest protein and water. So, you know, our product is, uh, is a nut milk base. So almond milk or coconut milk, we use high quality product, uh, proteins.
Christopher Hunter
00:23:25 - 00:24:05
We use a blend, so pea, rice and, and chickpea. And the reason we do that is because that creates a complete protein profile. So it gives you all nine essential amino acids. That's the only knock ever on plant protein, is that they don't have all nine amino acids. What we do for that reason, um, and it'll still be a premium product, like on the shelf at a whole foods. We will usually retail for 429 to 4.99 a bottle. There will be a multi, multi pack discount available on, on Amazon. So you won't pay $5 a bottle, but you're not going to pay a dollar like some of these, you know, very basic protein drinks that people may think of us.
Christopher Hunter
00:24:05 - 00:24:14
And so again, it's going to come down to liquid the lips. When people taste it, they'll know the difference, and, and we're happy to. We're excited to give them a new opportunity to consume it.
Blaine Bolus
00:24:14 - 00:25:00
We are really excited to announce that DTC Pod is officially part of the HubSpot podcast network. The HubSpot podcast network is the audio destination for business professionals, and we're really excited about being part of the network because we're going to be able to keep growing the show, bringing you guys amazing guests, and obviously helping you guys learn from the best founders, marketers, and builders of the most successful consumer brands. So, anyway, keep listening to DTC pod and more shows like us on the HubSpot podcast network@HubSpot.com. podcastnetwork. Awesome. And, and Chris, while we're on the topic of liquid ellipse, I'd love to kind of backtrack into your guys's story. And in terms of four Loko, right? I think when you say liquid ellipse, I immediately remember the taste of four Loko. I think it was a very distinct taste.
Blaine Bolus
00:25:00 - 00:25:41
It was something that was very different at the time. I'd love if you could just kind of walk us through the trajectory of that brand and that evolution and maybe some of the lessons that you learned and were able to apply to Koya, because, I mean, from a consumer's perspective, I remember I was probably like, you know, maybe 18 or 19 when it came out. It was like my freshman year of college or maybe in like, maybe senior year of high school, and you would start to see this stuff everywhere, but, and it was like, one day it was nowhere, and then the next day it was like everywhere, right? So like, what was that brand journey like for you? And I know you said it was something else before it became four Loko. Like, how did it happen? How did, how'd you guys blow it up like that?
Christopher Hunter
00:25:41 - 00:26:20
Yeah. So I'll give you the cliff notes here. I recently put a book out called Block Out Punch, an entrepreneur's journey from cast to clarity that I went through not only the Koya and the four logo story, but my own personal story, because, as you can imagine, theres a lot in there, right. But from a high level perspective, when we first launched the product, we called it four. It had four main ingredients, taurine, caffeine, guarana, which are all stimulants you find in energy drinks. And then it had Wormwood oil, which you may not know that was the active ingredient or is the active ingredient in absinthe. We were trying to differentiate ourselves. We werent the first caffeinated alcoholic beverage or alcoholic energy drink.
Christopher Hunter
00:26:20 - 00:26:46
Unfortunately, that did not work. We had it priced at a premium because we couldn't compete with the big guys on their scale. We needed to make money. We couldn't just, we weren't going to fuel this or fund this thing as a high burn business, and so we priced it at a premium. We had this unique ingredient. We thought, that'll help us. And we had this false sense of confidence because distributors were buying the product. We did a good enough job selling it to them.
Christopher Hunter
00:26:46 - 00:27:23
We were even getting the stores to buy the product, but the consumer wasn't buying the product off of the shelf. And so we went maybe a year in and realized, like, oh, shit, we're coming up on a crisis here. We're not going to be able to sell more product. Distributors aren't reordering. And so we said, all right, we better innovate, so let's look at what we can do. And so, just paying attention, we were spending our time in the streets, in the convenience stores, in the liquor stores, and we noticed that higher alcohol was selling. I mean, not some big revelation, but it just is kind of a, an insight for us. And so we said, all right, well, let's, let's ramp this up a little bit.
Christopher Hunter
00:27:23 - 00:27:47
Right? Like, the, the product we're competing with is at 6% alcohol. Ours is at 6% alcohol. There was a new one at 8% alcohol. Let's try 10% alcohol. So we did this, we did this iteration called four maxed, and we did a different can. We thought maybe the design wasn't it, so we did a different can. It was like a black can did some different flavors, and it did okay. It did better than our first one, but it didn't set the world on fire.
Christopher Hunter
00:27:47 - 00:28:19
But it gave us enough momentum to, one, stay in business, and then two, to feel confident trying new stuff. And that was like year two of the business, I would say. And so we're just, we're struggling along. We're not making a bunch of money. We don't have that many distributors. We're struggling to get by. And my partner came back from a sales blitz in California, and he had seen this product called Juice that was 24 ounce can, and it was 9.9% alcohol. And he goes, look, this stuffs selling.
Christopher Hunter
00:28:19 - 00:28:42
Like, we got to do something like this. And to be honest, I said, thats never going to work. No one can drink 24oz of this stuff. It just seemed crazy to me, right, but look, the numbers dont lie. And so we worked with a flavor house, and he took the lead on that. And I got the samples one day, and the fruit, the first flavor we were going to do was fruit punch. It was, like, kind of unique. Nothing else was out there.
Christopher Hunter
00:28:42 - 00:29:13
And so I tasted it, and I remember him calling me, and he goes, what do you think of that stuff? And I was like, man, this stuff tastes like liquid gold. It was crazy because it was 11% alcohol and you could barely taste the alcohol. And so that was, like, baffling to me. So we started down the process of, okay, what do we call this stuff? We were very. It was just three young guys, like, figuring out we were very unscientific. We weren't doing focus groups, we weren't doing whatever we said, all right? Our products called for this shit's kind of crazy. Let's just call it loco. And then let's do this camo pattern.
Christopher Hunter
00:29:13 - 00:29:45
It's different. I mean, it was literally just that. And we made it, and we got some of our distributors to pick it up. And I remember the moment that I knew that this was something special for me. We had shipped it to a couple distributors, but in my area, we had divided the country in three at that time, in my area, we had shipped to this distributor in North Carolina, and I was getting ready to go in to do a sales blitz in a couple of days, and I called them to see if they had enough inventory, which we always did. They always said, yeah, we're fine. We don't need any more. And they said, no, we're out.
Christopher Hunter
00:29:45 - 00:30:23
We're completely sold out. And I was like, no one's been there to sell it. They said, yeah, our reps sold at the stores, sold out of it already. We need to reorder. And I was like, oh, shit. And that started this three year sprint, two year sprint of us just going into new markets, opening up new distributors, because unlike non Alk, where I can sell it directly to you or to these broadline distributors, in alcohol, you have to have a distributor that sells to an exclusive territory. So we had to open up 325 distributors to cover the country. And so that was just our mad sprint over the next two years is like, open distributors.
Christopher Hunter
00:30:23 - 00:30:59
Put the product in, get it on the shelf, it just sells. So when you say it came out of nowhere, it did. I mean, it was a course of. It was a matter of two years that it was, it was the fastest growing product in the alcohol industry. I think we were like a top eight brewery at that time. But many people say it came out of nowhere because they weren't the core consumer. You know, it sounds like you might have been in the demographic that was interested at that time. When we hit the mainstream press, all these people were going, what the hell is this stuff? And there were all these consumers that were never going to be four loco drinkers, but they were curious because of the way it was being positioned.
Christopher Hunter
00:30:59 - 00:31:00
So it was a wild ride.
Blaine Bolus
00:31:00 - 00:31:15
And then what would you say? Like, what were some of the biggest lessons and takeaways that you learned during the four Loko kind of phenomenon that you could apply not only to Koya, but like any other businesses that you would launch in the. In the CPG sort of space.
Christopher Hunter
00:31:16 - 00:32:06
So when we, when we first launched four, we knew that there were some government agencies that weren't really thrilled about the idea of caffeine and alcohol being mixed. Right. There were a couple attorney generals who had sent letters to some competitors and to us saying they wanted us to reconsider, basically. But we had everything legally approved through the federal and state governments. So we felt like, hey, this is. If you change the rules, we'll change. But anyways, the lesson there was, when you're dealing with big government agencies, they don't have budgets and they don't have timelines, right? And so the reality of that is eventually it's going to come back and bite you. And so how that, how that went into practice, I guess, with Coia, is when we were figuring out our scalable product, we were using what was called HPP high pressure pasteurization, so there's no heat applied.
Christopher Hunter
00:32:06 - 00:32:44
And it was fine at the time, but right around the time that we pulled the product off the market. The FDA had come out and said, look, we don't know if we think this is safe. You have to go prove that it's safe or you have to change it. And so fresh off of the four Loko days, I was like, there's no chance we're going to go fight the government. We're going to change the pasteurization process. We're going to comply with what they want because I don't want to go build something and have it taken away at the whim of a government agency. So that was a huge lesson. I would say, look, I was 25 when we launched fusion projects, so that was much of my late twenties and early thirties.
Christopher Hunter
00:32:44 - 00:33:29
And my two partners there were college buddies. So we did not spend a lot of time on the soft skills, figuring out our roles, like having deep communication around issues that we may have either collectively or as a company. We were just running and gunning and scaling. The lesson coming out of that is like, boy, you gotta have a solid foundation in a company, in a partnership because if not, it can, it can totally crumble. Unfortunately, there were, there were three of us with unique skill sets that we were able to hold that thing together and, and it's still being held together by those guys today, or, I shouldn't say it that way, it's still being grown significantly by those guests today. But, um, but it was a, it was a big, you know, lesson to, to pay attention to. Sweet.
Blaine Bolus
00:33:29 - 00:33:56
And Chris, as we wrap up here, the last question I have on the coil front is kind of like, what's on? You guys have obviously done a great job. You really scaled, you've brought in vertical manufacturing into the mix. You're in a whole bunch of doors. You're launching products on Amazon. What else is top of mind for you as you grow the business? And what's, maybe a better question, what's the goal here? What's the long term play for Koi? Where do you want to see this in 510 years?
Christopher Hunter
00:33:56 - 00:34:42
Look, when we ultimately set out with this venture, it was to grow the best product and company that we could, was that we would sell it at some point. And that's probably still the assumption, right? We brought on investors. They expect a return. But what I've learned over the years is you can't really build a business with that goal in mind because you may make decisions that trying to facilitate that don't create the best long term situation for the company. And so what I'm excited about is, look, we've innovated around the Koya brand multiple times to try to figure out exactly what it is. We came out with a functional coffee line that was coia. We came out with a low sugar smoothie line that would compete with like, naked and bolthouse. They were all refrigerated single serve products.
Christopher Hunter
00:34:42 - 00:35:30
They all did fine, but none of them did as well as Koya, the protein line. Right? And so as we started to talk to our consumers and really pay attention to what was working, what wasnt, we realized that what Koya stands for is delicious. First and foremost, protein, plant protein and low sugar. And then the last attribute, which is fourth on our recent survey, is high fiber, which is an unsexy kind of ingredient. But it matters to people, especially right now. And so under that heading, we are now innovating into different categories that are relevant to protein. So I already talked about the shelf stable tetrapak that will launch on Amazon. But what we learned is that 70% of our consumers are female and a majority of those are new moms or young moms.
Christopher Hunter
00:35:30 - 00:35:59
And so I have three kids of my own. We all drink Coya here, but I can't tell you how many times I've seen half drank bottles sitting around the house. The point is, we're launching a kids line later in the year, too. And so the expansion into these different protein forward categories is really exciting. And you look at some of these companies like Quest, nutrition, or even organ as an example, they've been very successful innovating as long as they stay to the core of what the product is. And so that's what I think we're in the midst of doing.
Blaine Bolus
00:35:59 - 00:36:09
That's amazing. And last question for you, where can we connect with you? If the audience is tuning in, we want to connect. Why don't you shout out your brands and your socials? Where do we find you?
Christopher Hunter
00:36:09 - 00:36:24
Yeah, so Koya is the main brand I'm focused on right now. So drink Coia on Instagram, on TikTok, whatever it may be for me personally. Christopher Hunter on Instagram. I'm more active on LinkedIn. Those probably the best two places to find me. Sweet.
Blaine Bolus
00:36:24 - 00:36:26
Thanks for coming on the podcast.
Christopher Hunter
00:36:26 - 00:36:27
Thanks for having me.
Blaine Bolus
00:36:29 - 00:36:47
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