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Find out how much at airbnb.ca slash host. Expo West is a really big event in CPG, especially better for you. Yeah, it's a big convention in Anaheim. And we were using this tentpole event as being our launch.
So we had spent a lot of our money on, I think like almost $90,000 on building a booth. You know, you have to pay for the space, you have to get product out there. It was like our big bet. And we ship out to launch Poppy March 3rd, 2020, the first week of COVID.
And then a day into it, they canceled the entire thing. And at that moment, it was just so devastating for us because we're like, oh goodness, this was our moment. Where do we go from here? Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built.
I'm Guy Raz, and on the show today, how a mom and pop beverage made with apple cider vinegar got remade as Poppy, a soda sensation that sold to Pepsi for nearly $2 billion. Okay, I'm going to tell you about something I do every morning. And I'm going to qualify this by telling you that I have zero standing or expertise or academic training to give any advice on what to put into your body. All I know is what works for me, whether it's real or imagined or just witchcraft, it works.
So every morning, after I get a little morning sunlight, thank you, Andrew Huberman, I pour water into a tall glass and drop a tablespoon of apple cider vinegar into the water. And then I drink it. It's supposed to be really good for regulating blood sugar. And all I know is that I think it makes me feel pretty great.
But that's just me. For a lot of people, the taste of diluted apple cider vinegar is a non-starter, which brings us to today's story. Because about 10 years ago, Alison Ellsworth was doing a version of what I do as well. In her case, it seemed to help with digestion and chronic stomach issues.
The problem, though, at least for Alison, was the taste. So she started to add fruit juices to her vinegar and water mix and eventually started to share her concoction with friends. And soon, Alison's husband, Stephen, joined to help out as well. Now, you probably know what happened next, because as these things go, enough people liked what Alison was making that it occurred to her she might have a product and a business.
So Alison applied to a local farmer's market in Dallas and started bottling her home brew vinegar drink and called it Mother Beverage. Doesn't quite slip off the tongue, but it was a start. One day, Alison and Stephen found out that Shark Tank was coming to Dallas looking for a perspective. Yes, now I'm not going to unravel this whole story here because you're about to hear it, but this is the story of how a farmer's market vinegar drink became poppy, a prebiotic soda that eventually sold to Pepsi for nearly $2 billion.
Think about that. In less than 10 years, the brand went from a mom and pop curiosity at a Texas farmer's market to a $2 billion sensation. As for Stephen and Alison, they didn't start their careers in the beverage industry or even in the health and wellness space. They both grew up in the 80s and 90s.
Alison in Texas, Stephen in Wisconsin. After attending the University of Utah, Stephen worked briefly in the corporate world, including a stint at Wells Fargo, but he didn't like it all that much. Yeah, that's right. I'd like to say that I was unemployable in the corporate world.
I've always had the ability to earn money from a young age. I got a paper route when I was 11, and that's very autonomous. Mowing lawns, shoveling driveways, and I never had to go work for someone to get that. I just had a really difficult time taking direction when I just had such a clear idea of what I wanted to do and the way in which I wanted to do it was oftentimes better than what my boss was recommending.
And Alison, when you graduated, you, I think, pretty much right out of college went to go work in the oil and gas industry, if I'm not mistaken. Tell me what you did. Well, when I graduated college in 2009, I didn't want to go, like Stephen was saying, go work for the man or some corporate job making $30,000 a year, so I was like, okay, my dad has these resources. I can go work in oil and gas, and so he did work in oil and gas, and you start off at a really young age making like $500 a day, right?
It's really good money. You're working seven days a week. You're working from dawn to dusk, though. It's really, really not the easiest job, but for me, the hustle was there, and I love just making money.
Honestly, I think that's a big driver of that self-starting mentality that just kind of was instilled in for me from a really young age. I love that you say that because a lot of people are uncomfortable saying that, right? Because I think there's a perception of saying money was important to me. It sounds like it's greedy, but actually, I'm assuming that from your perspective, it's freedom.
You didn't grow up with anything. Yeah, I didn't grow up with a lot of money, even though my dad had money. I love him to death, but we didn't really reconnect until after college, and so I never knew I didn't have money, but I knew I didn't have as much as everyone else, if that makes sense. So for me, it was a really big piece was the freedom.
And working in the industry, it wasn't like you were working on drilling rigs, or like you were, tell me what you were actually doing. Yeah, so it's kind of similar to what people call a land man, obviously as a land woman, but I would go into courthouses in these small towns of about 3,000 people, and I would research basically ancestries of where the government or the United States or the state gave land to that settler back in the 1800s, and then I would track that forward, and I would just see who owns those minerals, and then you would go and track those people down, you would negotiate with them on whether or not we could drill for oil on your land, or do research, get a lot of surface research and seismic activity and water research, so it's very self-starter, no one is actually there with you, so I'd be in this town in the middle of nowhere by myself, and you have to be very on top of it and hit your deadlines. So you're doing this work, and Stephen, you don't last that long in the corporate world, but you're in Utah, and I guess you would eventually go work at a ski and snowboard shop. Yeah, so I guess it was a sabbatical from the corporate world.
When I went to school, I was a good student. I tried to rearrange my schedule so I could ski as much as possible, snowboard as much as possible, and so I went and was a buyer and a manager at the snowboard shop, and so I got to test out all of the latest gear, got to buy the gear for the shop, and ultimately got to do what I was super passionate about. So this store that you would go and that you worked for, this was in Salt Lake City? It was.
It was in Salt Lake City at the Gateway Mall. And one of the projects when I was working was in Utah, and I happened to be at the mall walking into that snowboard shop, and that's where me and Stephen met. What were you doing there? I actually do enjoy snowboarding as well, not as hardcore as Stephen, and I went in to buy a backpack.
I think I was looking at some bindings, and he was the one that helped me, and I didn't know a single soul. I was living two hours outside the city in a teeny town called E from Utah, and he said to me, can I get your number? I would love to take you to Ice Cream. Wow, let's just pause for a second, because Stephen, was that something that you would normally do, like just ask a customer out?
No, so that was, honestly, it was the first time, and I was actually pretty intentional about not doing that, because I felt it sort of broke the professional barrier, but I just didn't pass up the opportunity when I saw Allison come in. Why? I mean, she was looking for a backpack, and it could have just been an ordinary transaction, and we would never even have this conversation, like she would go in. And I didn't even buy the backpack.
Yeah, I'm a terrible salesperson. Honestly, when he gave me his number and said, do you want to go to Ice Cream, I thought to myself, obviously, he's probably Mormon, and I grew up Seventh-day Adventist, which is also kind of a stricter religion, and so it's, you know, similar to no drinking, and you know, working. Very healthy lifestyle also, right? Yeah, and no, it was great, because I think we had a lot of those similar values, right?
So when he first asked you to go for Ice Cream, that was not, you weren't like, oh, yeah, you were thinking, okay, he's clearly a member of the church, because he's not asking me for coffee or for a beer. Yeah, that's right. I'm from a big, happy Mormon family, and I don't say that cheekily. Right.
You know, religion's such a huge piece of dating, and the second we hung out, I realized that he was very different, and it wasn't such a big thing. Like, it just moved really quick, and then we got engaged seven months into it, and just, I don't know, just like when you know, you know. Yeah, for sure. All right, so you guys get married in 2014, and I guess even, you wind up quitting your job at Snowboard Shop and going on the road to work with Allison doing similar work, like oil and gas work, right?
Correct. And so where were you guys actually living at this point? We ended up moving into a teeny motorhome for a few months, and we moved to Wyoming, and we're working on all of these different things, and honestly, this is why I started Poppy, because on that road, I kind of fell ill. All right, let's back up a little bit.
If you're feeling ill, like stomach issues, digestion, like what were your symptoms? Yeah, I just look back at pictures, and my whole body was inflamed. So red puffiness, my skin, horrible acne, horrible tummy problems. I was allergic to all perfumes, all makeup, shampoos.
My eyes would swell shut. Horrible. You're traveling, you don't have access to be able to work out consistently, you're not sleeping consistently, and then you don't have access to good food, and I think that was a huge piece of why I didn't feel good, and going to doctors, they just kept writing me off saying, you're fine, like, woman problems, right? Yeah.
All right, so you guys are working, and Allison, in the meantime, you're dealing with just this frustration about not feeling well. I guess at a certain point, maybe you found something online, you started to experiment with apple cider vinegar, like to take, I guess, to dilute in water and see if that would make you feel better? Yeah, I ended up doing a full elimination diet, where I cut out sugar, dairy, gluten, all the things, and then I slowly started introducing those foods back into my diet, and the consistent thing when you're doing that, to help with the cleansing, what they call process, was drinking apple cider vinegar every day. And so going through that process, it was just life-changing.
Before I gave up all the food, within two weeks of just having apple cider vinegar, I felt 50% better. And I just discovered that food can really affect the way that you feel. And the only problem with apple cider vinegar is, it's just a really harsh taste. And so I was getting this big, huge thing of water, adding lemon and cayenne pepper to it, and just like almost choking it down daily, knowing I had to do it.
I was like looking forward to it. And I just was like, I gotta make this taste better. There just has to be a better way. Yeah, I mean, I guess you should pause and talk about apple cider vinegar for a moment, because I take it every day, and I take a shot of it and dilute it in like 8 to 12 ounces of water.
You're not supposed to drink it straight. It's not actually, it's not your throat. But there's a lot of research that shows it does have an impact on insulin sensitivity, which lowers blood sugar. It's a really great, and people have been using it for a long time.
Yeah, and at the time, I had no idea about any of the research or anything behind it other than maybe my grandma told me to take a shot when I was sick, right? And growing up, and I just knew, I just felt different. But I was also trying to get Stephen to drink it. I was like, you have to try this.
He's like, you're crazy. I'm not drinking that. And I was like, okay, I'm gonna make it taste better. Like goal, I will make you try this somehow, some way.
But in creating, I didn't want to take away from those health properties where I could have just added orange juice or a ton of sugar or a lot of other things. So for me, it was really important to try to keep the sugar really low and the ingredients, basically ingredients that you can love and pronounce and just ingredients people can know. All right, so you are, this is having an impact. And like, anytime people find something that starts to really help them, they get really passionate about it.
Because I've been in this position too, and I'm sure you're just like, talking about apple cider vinegar to anybody who listened. But to some people, they might be like, oh, that's weird. That sounds weird. You're doing what?
Everyone thought it was weird. I remember I had one neighbor who she was having some health problems as well, and then she started knocking on my door, and I was making her mason jars up that weekly. It was this thing where I was like, wait, this is interesting. Other people are interested in it.
And then soon after that, we went home for Thanksgiving to Texas, and my sister and brother-in-law and my family, like, everyone's there, and I bring it with me. And I just think everyone's just as excited as me. And I set it up as like a tasting in the sunroom, and the only person that shows up to try it is my brother-in-law. Nobody else would even try it.
They're like, apple cider vinegar? Like, no, thank you. I have nothing to do with it. And they all called me crazy.
And as you're doing this, like, what are some of the other things you're doing to make it more palatable? Like, I actually love the taste of apples. I buy like, I buy those giant bottles of Costco. You get like three or four, you know?
But it sounds like you did not love the taste of in water. You were trying to mask it somehow. I was trying to mask it, and you know, you're a rarity. Not a lot of people like it, right?
Like, you're a little crazy. No. With the process, and I'll be honest, I remember trying all sorts of things. I remember, like it was yesterday, simmering raspberries to make purees.
I tried essential oils. But really what we landed on in those early days was I used to infuse the vinegar. So I would get like real raspberries with real rose petals, and I'd put the vinegar in it, and I'd put it on the table, and it would infuse. So it would take on the flavor of those, and then I would literally use sparkling water, SodaStream, and then the main sweetener at the time, Stevia.
And some of the first flavors that I made, honestly, one of my stuff today, which is raspberry rose. I remember doing an orange cinnamon. It was like real cinnamon sticks, lavender lemons, right? So really just flavors that I thought would go really well together, and some worked, and some didn't.
All right. You're making this. This is like 2015-ish. Tell me how, what do you get?
Because making it for yourself is one thing, but deciding to pursue this as a business is another thing. And oftentimes, you need outside validation. You need people who are telling you, hey, you have something here. So was that happening?
Who was saying that? Yeah. So I remember going through this. I was really passionate about it.
At the same time, I was feeling better, right? I talked about just the way I personally felt, and both Stephen and I looked at each other. We'd be married for a little bit. We're like, maybe we want to start having a family.
And so I remember sitting at the table one night. It was me, my dad, and Stephen. And we were just like, what are we going to do next? Like, if we want to start a family, and we don't want to be on the road, maybe Stephen could stay on the road while I'm home, but nobody wants to live that life either.
And my dad goes, why don't you sell your hooch? And I remember calling it hooch, and it kind of hit us. Like, wait, could this be a business? It was still a hobby at that point.
So we got up, and we bought a place. We moved to Dallas. We moved in December, and I got pregnant right away in January. It was a lot quicker.
But I think, like, it was really interesting as you sort of talk about fate and some of these things that really... align um thankfully we had a long project that we had been working in wyoming and the project was sort of winding down and so allison was gung-ho she you know we finished the project she didn't go back to work she started doing this i found a local job in dallas to pay the bills and so this is what i would do during the day and then at nights and on the weekends allison and i would work together we just started buying equipment we started maxing the credit cards out pretty early and just kind of putting our life savings into what we just wanted to do so i remember our guest room right i'm like three months pregnant at this point our guest room on the bottom floor had like four vats of vinegar that were what 5200 gallons so our entire house smells like vinegar we have upstairs on our main floor we have a table that we've basically makeshifted this bottling unit together i mean i remember like when we first started doing it it was exploding on the roof of our brand new house this whole thing and we would literally measure the vinegar with um just like these i don't know a syringe and we would put it into them each one and we'd measure the exact amount and we'd fill it water and then we'd cap it a bottle yeah just bottles at that time we had labels we were working through like what is the name what would we call it what do we want to say what are our values so i just want to understand this first of all how did you even learn how to do that i mean because this right there's like a science to it and the ph levels and obviously trial and error with exploding bottles but how did you know what to buy and how to make it was it just purely like google research so that's i'm kind of a science nerd and my brain is really linear and so i dug into the science of it so i had an understanding of what a little bit about fermentation i was really into kombucha even in college i think i started drinking kombucha like in 2006 we would brew uh beer in college so i had an idea of like fermentation and you know sugars and yeast and these other things is what ultimately caused fermentation so it was honestly trial and error we had really rudimentary understanding and um we just gave it a whirl you would buy and these were like 12 ounce bottles like glass bottles so really funny story is we were filling these one by one the equipment we had was essentially like what the inside of like a soda fountain looks like you've got this little machine that takes in water it's got to be a you know temperature uh that took a little bit to find out it has to be around 40 degrees in order for like the carbonation or the co2 to really sort of dissolve within the water solution and it would shoot out as carbonated water so think about a more efficient soda stream and so we were doing this and i remember allison we got these bottles they were square they were really they looked great they were amazing and we put in there and we sealed it and you know the next day we were taking some photos of it with some fresh fruit around it and start bringing the brain to life and probably like 10 minutes in the bottle just blew up and we're like from the pressure of the carbonation yeah exactly so that's what led us to discover that not all kinds of bottles didn't handle carbonation and so so we ended up just getting a standard sort of 12 ounce soda bottle so how much initially in that the first sort of six months of 2016 would you estimate you invested in the equipment like was it that expensive was it really expensive or was it relatively cheap i think it was it was relatively cheap um looking back at it i think the pallet bottles was probably the most expensive thing that we bought but the equipment that we had purchased was maybe a couple thousand dollars yeah i mean how did you i mean at that point you need some money did you go around asking people to invest in your business yeah so i went to my sister who's always been a really big believer in me and she ended up giving us thirty thousand dollars my dad gave us thirty thousand dollars and then we put thirty thousand dollars in of our own money so basically a total of ninety thousand dollars which was everything we had yeah all right so tell me about the name that you came up with and and and and even the sort of look of it what because you called it mother beverage right so that was the first thing tell me about that name yeah so we named it mother beverage after the mother vinegar so there's just like floaty stuff in the bottom of vinegar kombucha has something similar called the scoby but in vinegar it's called the mother of vinegar a lot of people like oh it's because you're a mother yourself no not really but we do love calling it mother beverage at the time all right so you by the summer of 2016 you are ready or i guess maybe even earlier than that you're ready to kind of debut this at a farmer's market in dallas um and tell me tell me allison what was the plan i mean you would just set up a table and put them there and what was the what was what were you selling people what were you what was the promise that you were making that it was going to make them feel better like it made you feel better yeah i think a little bit of that but the beauty of apple cider vinegar is almost everybody's heard of it there's not a lot of education around that as an ingredient so people see it they've either tried it someone's told them they need to drink it or they drink it for years and they do it every single day like you so they like immediately got why we're doing it and so i didn't really have to sell like my story it just was an easier way to consume apple cider vinegar and people just related to it and got it right away yeah and you keep on talking about this plan there wasn't really a plan it was just it was just one foot in front of the other and this is also at the time where kombucha is on the rise and so if we think about sort of marketing or positioning ourselves adjacent to kombucha it was a beverage or a product that had similar attributes to kombucha but with less sugar right like a sort of a soury taste that people were already kind of used to and and so when you when you put like you set a table at the farmer's market in dallas i mean who was buying it who i mean was it just curious people who were like i'll try this and or what like who were they the farmer's market is a place of discovery that people are more willing to just try things that they typically wouldn't do i think that people going there are seeking those type of products so some people actually did not get it and they thought we were crazy they didn't buy and then people immediately got it and i will say we were selling out like every week we'd make it we'd sell out the next week we'd make you know that and a half we would sell out so we were like okay something's working and how much was a bottle it was pretty close it was four dollars a bottle four dollars a bottle three ninety nine three ninety nine a bottle i mean how quickly because the farmer's market was once a week right i'm assuming every saturday all right tell me the story whole foods buyer whole foods based out of austin initially uh starting austin of course and a buyer comes to the farmer's market what does she say to you did she say i mean was it at that moment where she says would you guys be interested in coming to whole foods yeah and it's not as simple as that right she gave us her card and said there's nothing like this in whole foods you guys have to be in whole foods but we didn't have good labels we didn't really have nutritionals and done the testing to where you have to be at the level of being a grocery store one you can't make it in your house to be in a grocery store so we thought oh my gosh we got this card we made it little did we know we weren't even on shelf till 10 months later yeah and she was she was offering you what one whole foods or two whole foods or what no we thought it was national whole foods she was offering you a few whole food stores we didn't even get into the planogram so we from the moment we got the card from her we at that point went and got a lease we opened up our own manufacturing facility thinking we were going to be nationwide whole foods for them to say no no no you don't even have dallas we've given you a license to go hunt for it and what that means is you actually now have to go store to store and sell in your product to every single store at that time and it was 14 whole foods dallas fort worth and so we went all in thinking oh my gosh we've made it we're gonna get all this little did we know we didn't get anything we still had a lot of work to do welcome back in just a moment allison and steven are told that their branding totally sucks stay with us i'm guy roz and you're listening to how i built this hey welcome back to how i built this i'm guy roz so it's around 2016 and a buyer at whole foods has encouraged steven and allison to ramp up production of mother beverage and you'd think that they'd find a bottling plant to partner with but they don't they end up renting their own warehouse because no co-packer wants to work with them so there was one big hurdle we were totally unpasteurized we wanted to have raw unfiltered apple cider vinegar in our product and so there's there's many reasons why co-manufacturers don't want to do that there's many reasons why um even craft breweries who were smaller and you know we're more willing to to maybe do something at a smaller scale for us we're unwilling to do it you know raw unfiltered apple cider vinegar unfiltered you've got the floaty stuff in there so we can get in their lines it could potentially contaminate other products of theirs the raw factor it's got a seed of factor in there and so that can cause their beers to sour that can cause other issues in in um in other products as i mentioned and so being unpasteurized being raw and being unfiltered there just weren't co-manufacturers that were honestly willing to take us on and take out this but really for this first initial run at whole foods maybe even the first year or so it's all being made by hand basically correct you were like pouring vinegar into vats and uh and what pouring fruits into the vats like what tell me about the process of working in the warehouse it was kind of crazy i remember like being on the bottling line and it's really difficult to bottle a carbonated drink it seems like such an easy thing but you think about you go to soda fountain what happens you pour it in your cup it bubbles you know foams over it goes everywhere and so we were just like we were ragging our brains like how like how does this how does this happen and it was really interesting it was probably one of the most frustrating sort of experiences and journeys for me to like get the carbonated product into the bottle without it foaming over in a time to matter yeah how i mean how were you doing it was like it was like a soda fountain like you go to a burger place and you got your your soda fountain and you just put your cup under it was a version of that with bottles not like a forehead filler right like a professional forehead filler you put all of the glass bottles underneath it it's supposed to suction it so tight that you fill it and the air doesn't get in it's supposed to fill and you had that we did we had two of those so we could do eight bottles at a time we had two lines set up and we would just try to figure out a way to get this but it would work for like 20 minutes and not work for three hours and we would be there for hours just filling product to maybe get you know a couple hundred bottles out the door it was it wasn't scalable even i would say that was the hardest part of the business was the filling the making it i mean you know the steeping the quote unquote syrup was the easiest part of it all right you're sort of working on this for many many months and now it's time to go into whole foods and did you start with just one whole foods in dallas so we were able to sell them into i think we got into maybe eight of the stores from the beginning correct but the beauty of getting into whole foods opened up a whole other avenue on the distribution side so you can't just self-distribute to someone like a whole foods so opened up unify which then opened up other ones so it's a distributor and they require you to work with a distributor like unify yeah and it's hard to even get into them it's like the chicken or the egg get into unify if you don't have a retail you can't get in so it was kind of nice for us right from the beginning to kind of have whole foods so they took us in but then that opened it up to be able to get into other accounts around the dallas area so we got into the royal blues of the world which is like a dallas grocery store we were able to get into some natural grocers and you know just local sandwich shops and so we had a good presence in dallas not just eight to 14 and when you were in okay so when you started out whole foods right you got a distributor because that's part of the requirement how did you then get people to be aware of it would you go in i mean by the way you're also the two of you also a baby a brand new baby at home so tell me how what you were doing you were going in and setting up a table and just asking people if they want to try this new product anything anything we were doing instagram posts gaining followers i think we had like 10 000 followers on instagram we had a little website we were selling the product on our website as well which was really difficult if you think of how do you ship glass bottles that are liquid through the mail um we did that i mean it was just like anything and everything but we didn't do any paid media or have any know-how to do anything like that we also had no money yeah how about employees i mean i mean both of you guys are running this business together and then would i have to assume you could physically do everything and load the bottles into the car into the cases and also like did you hire temporary people or did you start to hire like full-time people to help yes we had yes we started to hire folks that would manage the farmer's market stands on the weekend and then i hired a crew of maybe six or seven sort of um production members they were most of them were 1099 there was a few w2 employees but they would they would do everything so they would come in we would probably work nine to 12 hour shifts five days a week but we weren't paying ourselves so to keep in mind quote-unquote yes we quit our jobs but steven found a job that he could do at night to pay our mortgage so he was still working a second job basically this whole time yeah it was really what allowed us to to reinvest everything that we were making at the time all right you're this just sounds like a crazy life right because you are trying to expand the business you're trying to get people to buy the product for it how was it doing i mean was it a hit at whole i mean hit is a relative term right because you you know it's not like all of a sudden you know there's a windfall of cash but was it successful more or less at whole foods right away yeah i honestly think we had some some really great traction right it wasn't at this massive scale but every week every month our sales would continue to increase we would get more notoriety we get better shelf placement in whole foods we would move from the dry shelf to the grab and go coolers at the front or we would get an end cap or something like that and so you know we were starting to really see that progress and people started to notice so much so that um there was a there's a segment called shaping dfw and abc actually reached out to us they said i love what you guys are doing i really think that you guys are on the forefront you're helping to really shape this new wave in dfw dallas fort worth area of better for you um sort of like a local tv uh like news channel no it's a seven minute segment honestly that was a really beautiful piece for us to be able to take that and say hey this is going to be on the networks give us more shelf space give us more whole foods right and so i think the category review was coming up and they had basically accepted us into more of quote unquote whole foods what would be called like a global rollout where each individual region has to accept you and i think we ended up getting into seven regions across the u.s so obviously something was working and this was like the next step we're like okay we're gonna go into nationwide um we need money and so we kind of look at each other like we need to figure out manufacturing we need money it was crazy what kind of sales were you doing in the first year like over half a million dollars i wouldn't say it was that much i think when we when we went into shark tank i think it was we had done about a half a million dollars in revenue in the previous 12 to 18 months something like that so we were putting together like you know a couple hundred thousand dollars all right so the product really launches in 2016 and i want to talk about shark tank as this happens your episode appears in 2018 i don't know when you filmed it tell me about the shark tank strategy because clearly this was a strategy to get attention maybe to attract some investment and to kind of supercharge the brand how did that what was a conversation that the two of you had you thought hey let's let's try our hand at shark tank no we actually had someone approach us who was a fan of the brand wanted to invest and it was he was gonna give us around two hundred thousand dollars and had no resources he didn't know anything about cpg he had no employees no retailer connections nothing and it just didn't quite sit right with me and steven he just had money and i think like as any entrepreneur the the saying of like don't take the money was always something i think most people know right that's not anything new and i was on my phone i think like two days later after him offering this money and i saw shark tank was coming to town and they had open casting calls in three days so we went and stood in line amongst hundreds of other people it was an eight hour ordeal and we just pitched our hearts out and immediately after pitching our product which you only get two minutes pitch elevator pitch um they were like this is a fantastic product you guys are definitely gonna make it to the next step and then it goes dark and you're gonna make it on shark tank and you don't hear anything for a few weeks and then they're like oh hey fill out this paperwork and then they go dark and it's just like a very long process but at that point even the thought of getting on shark tank we did tell that other investor hey we have to see this brew and see if we can get a deal on shark tank and so we said no to him and so you find out that you are going to go uh to la and appear on shark tank and usually the way it works based on conversations we've had on the show with other people on is that you film it and then a few months later it's it airs and you're not always sure whether you're going to be on it i mean usually kind of give you a heads up that you're gonna make it on but they do cut people out um i guess 2018 you both fly out to la to film your episode so i was pregnant with our second i was three months pregnant with our second we did the elevator pitch and then it basically took six months for us to go to that process for them to finally say hey you guys are gonna be on shark tank so i ended up being nine months pregnant on shark tank and the thing is they wanted us to be matched up with a certain shark right at the end of the day the show wants you to be successful they want you to get a deal and so through the ups and downs and learning through all that we fly out to la you know the night before they tell us where sharks are and then we go in the next day and we pitch you go on you go on i know that you know you don't normally meet the sharks until the screen opens and you walk on stage and you start pitching and one of the sharks was a guest shark rohan oza who had been involved in branding around coke for cola products and he was involved in bi and he involved in other i think vitamin water i can't remember exactly what um tell me a little bit about so you make the pitch and people can see it um and were they did you feel like you know sometimes they're not always so nice did you feel like they were nice to you guys no mr wonderful called us an apple cider vinegar roach they didn't get that we were an apple cider vinegar drink like what were we doing who are we um someone else that was on was bethany frankel who kind of has some beverage experience as well and we're really excited about her even though she was screaming at us the whole time because we made her take a shot apple cider vinegar and she wasn't too happy and they didn't like it no they don't like it beverage is also very difficult it's very capital intensive you don't if you don't know how that world works it's hard to find the right investor and honestly the right investor for us was rohan oza was it clear to you right away that he was he was interested that his questions were different from the others you know it's a it's hard to it's hard to track that on whether or not he was asking serious questions but i also know sort of looking back he was definitely playing it cool right he was definitely not trying to show his cards you know he leaned in he was basically like you know the product is great you know he's like i'm interested in this thing but he's he's like it's gonna cost you a lot more than what you're asking for what were you guys hoping for i think we initially went in there asking for four hundred thousand dollars in exchange for 10 of business so you were you were um valuing your business four million dollars we knew it was high but i mean we had worked with the producers to basically say hey listen like you can't go in asking for the number that you think you're gonna get you guys are a little high and so ultimately i think it was we ultimately landed on what i think was it was a fair valuation and definitely gave rohan enough skin in the game to be energized and excited about uh being helpful so looking back that's not normal to walk in and ask about that amount of money usually people ask for fifty hundred thousand two hundred thousand it's a lot easier for a deal to get done so us walking and asking for four hundred thousand dollars is quite high and so he did come up to the twenty five percent and i'll be honest we looked at each other and we immediately said yes because we just knew he was the right partner for us to really take it to the next level so when he offers you four grand for twenty five percent of the company but the other thing i guess was is that rohan says to you guys hey um this has to be a complete overhaul a complete rebound tell me about what he said to you and how you reacted to that initially he basically said look you have a fantastic story you have a fantastic product but you're bringing a shit and honestly it didn't offend us because we knew we had spent so much time on the product we'd never thought about the brand or the marketing piece of it and it was such a piece that we were so desperate to kind of figure out that we were like yep let's do it we were like let's change the name let's do the whole rebrand we were so here for it and what did he say he needed to change everything but we were okay with that because we already decided that we're going to change everything we wanted to change the name the position at this point it was apple cider vinegar drink and he was like no this is so much bigger this is soda and at the time we're like well we don't know for soda like that's a big word to like chew on that's a huge category so let's play in this functional soda space which is like a whole new category that no one had really been able to figure out and kombucha had tried to take on soda sparkling water had tried to be an alternative to soda no one had quite figured out this disruptive soda space right and so we're like let's play adjacent to soda and be better for you soda so we took about nine months we did a huge branding exercise like what is um if we're a car what kind of car are we if we're a girl at the party are we the cool girl are we the girl dancing on the table like what what is the personality behind us are we approachable are we funny so we did all this work it was me steven rohan and rohan's partner stevie and it was just us four for about nine months what are we changing the name to we landed on poppy which is a playoff of soda pop we weren't sure if we were gonna do white cans or colored cans right because white creates this like healthy halo it's clean girl aesthetic it's it's you know clean and fresh whereas color kind of screams flavor it's fun and we wanted to approach health and wellness from a fun lens versus a niche better for you lens um it's probably one of the bigger disagreements at the beginning me and rohan were leaning more on the white side because i was like a purist and then stevie and steven wanted to do colored cans we ended up printing the cans and we took them to the grocery store we placed them on the shelf and we stood back and we were like which one looks best and hands down i will say i was wrong color cans were the way to go it just popped off the shelf and no one was doing better for you with color at the time so okay i want to get to that but in this long period of time between the time you signed an agreement got rolling on as an investor and you relaunched it you were still selling mother beverage and i'm assuming when the shark tank episode came out there was a lot of interest in mother beverage we didn't have a spike but you know on the on the back end we started to do road shows at sam so we the business continued to grow um you know so we really had to do both we had to rebrand reposition do all that all that great work while you know sort of keeping the core business in steady state we still had bills to pay we still had a warehouse we still had overhead well we went through all of that stuff of whole foods had taken mother from the the 14 dallas whole foods we were in the local shops now they've accepted mother beverage into seven regions of whole foods so then we basically had to go back and say just kidding we're changing the name we're changing the packaging will you guys still take this and so there was a lot of risk to that to basically have the grocery store that kind of give you your start saying like we love what we did but we're gonna give you guys something completely new and then we realized like we're gonna call ourselves soda we can no longer be in glass bottles we 100 have to be in 12 ounce soda cans and so we had this manufacturer set up and basically what we're like two days away from our renewal and you had to call them and basically cancel the whole p.o it was it was quite a great yeah yeah we ultimately decided to go 12 ounce soda cans colored labels but the tricky part about that was is we had a national sprouts rollout we had a you know almost national rollout at whole foods with no manufacturing so we basically had six weeks worth of inventory to basically sell through our mother beverage keep our current customers happy while setting up a new supply chain with new co-manufacturers learning that whole thing within six weeks so you're ready for a launch when we come back in just a moment poppy's big launch in march of 2020 is completely derailed stay with us i'm guy roz and you're listening to how i built this hey welcome back to how i built this i'm guy roz so it's march of 2020 and mother beverage is rebranded as poppy and it's ready for its maiden voyage at one of the biggest trade shows in the country expo west in anaheim california we were using this tentpole event as being our launch right so we had spent a lot of our money on i think like almost 90 000 on building a booth you know you have to pay for the space you have to get product out there it was like our big bet to come out and like meet retailers and really put poppy at the forefront of everyone's mind and we ship out to anaheim and we are one of the brands out there half of the people don't show up because i think on our flight to anaheim there's 10 cases in the u.s and we're like oh this is gonna blow over in a week like we're we put a year into this and you know years pass with mother like we're doing this and so we get out there and then a day into it they cancel the entire thing and at that moment it was just so devastating for us because we're like oh goodness this was our moment where do we go from here um we pack up the booth we get back on our flight and on our flight home there was hundreds of cases right it just had escalated really quickly within covid and we were so thankful that we had loaded in a ton of product into amazon um grocery stores basically told us we're not going to cut you in we're more concerned with putting toilet paper on the shelf so we kind of just focused on amazon we didn't do anything on our own website for the first little bit and it was the first time everyone in the world was thinking about their health and wellness they were thinking hey how can i pantry load on things that are shelf stable and that they taste good and so we just really leaned into that thinking for the first you know month and a half of business before everyone kind of started figuring out this whole covid thing and but i mean imagine initially you were really nervous you were worried we were devastated i think alison and i were talking about this i think one of like the entrepreneurs are slightly delusional right maybe we don't have we're delusional optimists and so i think it was it was we were in a good position because we didn't have a ton of overhead we didn't have a ton of employees to support you know we were we were a really lean team and we were growing right and so we didn't have a ton of things to support so it really left us in this opportunistic situation where we were able to be agile and disruptive in our approach to market and how we interacted with consumers it was a lot of pressure but it honestly like forced us to to think really outside of the box all right so there's an update uh on shark tank i think the airs in april of 2020 just kind of an update on what's going on with your your brand and that i think i think instantly you get a boost right and on most of your sales at this point are through amazon direct to consumer yeah so we were mostly on amazon and then in april grocery store shelves were starting to do the load-ins kind of had gotten their feet underneath them we're kind of starting to hit the retail shelf and we had filmed an update on shark tank about poppy and the brand and it aired friday night second week of april and it just blew up so we hit number one on amazon's hot new product list we're doing like 3 000 on amazon quickly over the next few months we're doing 250 000 on amazon a month it just like absolutely blew up our business and really it was really eye-opening for us to have a national commercial month too basically national commercial yeah free commercial basically you know so this was really the big spike in our business and as allison said we were thankful that we had onboarded amazon we had shipped in what we thought was a lot of product into amazon i think we honestly sold out of that in like the first couple hours after after it launched tell me about about i mean that you know and we've heard this before which is a shark tank absolutely boost sales but then it can slow down then things can slow down and people stop ordering um i think for you guys what really helped in some ways because it's still covid and people are still not you know people go in grocery stores but not not you know it was a different experience i think for you guys social media really became a lifeline especially tiktok tell me a little bit about how you started to use tiktok and how that began and how did you use it well for us at that point i remember at the update shark tank there's some tiktokers dancing in the whole foods that we were filming in and some one of them grabbed my phone and downloaded tiktok on my phone and i remember getting on it and playing with it and it really was no brands no brands around tiktok at this time a lot of people were introduced to it through covid and kind of were bored at home and started creating there's like this creator platform and i just in my head kept thinking there has to be a way to market to be on here there's hundreds of thousands of people now you know millions on there and it's free marketing so i remember being like you guys tiktok's the next wild wild west we gotta do it rohan and stevie including my steven who's like i don't know sure like no one really got it and i just was like okay i'm gonna get on i'm gonna spend my nights and my weekends i'm just start posting so i started doing recipe videos i was dancing i was doing transition i had my kids running around in it i made steven be in with me and i was just trying literally anything and honestly one night i sat down on the couch and i just told my story i did it in one minute or less of started this in my kitchen got a deal on shark tank it's five grams of sugar it's apple cider vinegar it's this and i posted it and went to bed and we woke up we sold a hundred thousand dollars on amazon that night and everyone started calling where did this spike come from and no one thought to look to tiktok and so i was like you guys we went viral on tiktok and then everyone's eyes were open from that moment that's amazing i mean the growth of the product really just kind of explodes after after the launch the rebrand launch in 2020 you know by 2023 it's 100 million in sales and then you know it's like you know the next year i think it's 500 million in sales i want to i'm curious what were you were you thinking that that regular soda was your competition or did you think that sort of better quote-unquote better for you drinks or less sugar lower sugar drinks were your competition look i think we created a brand new category so when we had poppy going to grocery stores they didn't know where to put us so in the early days they put us next to sparkling water they put us in the enhanced water set next to the buys and the vitamin waters and coconut waters you know just a little bit of a higher price point because if you were to put us at that point with a product that was kind of not quite proven not a lot of consumers knew about it and you put it a $250 can next to a 99 cent soda can there would have been a disconnect so for the first few years we worked with the retailers figuring out what is poppy and what category does it live in even though on our end we always knew our mission was to revolutionize soda for the next generation and so as we grew as our awareness grew we slowly started to carve out space within the soda set and now we have an entire new set called the modern soda set in retail and in grocery stores that did not exist five years ago yeah i think it's really interesting it goes all the way back to the positioning work we were the first ones in the functional you know sort of modern soda to actually call ourselves a soda we call ourselves a prebiotic soda we were the first ones and at that point in time it was crazy because soda was at the pinnacle of a dirty word right it was sparkling water it was like who drinks soda like that's so bad for you like why would you ever do that you know so it was really a bold decision for us to put prebiotic soda on the front of the pack and as allison said i think it was just building on building year after year month after month as we as we gained a bigger audience i'm curious i mean better for you is a tricky word because you know a lot of people clean and other terms that are they're not you know sort of technically legally sort of defined but but obviously poppy has considerably less sugar than a can of coke right can't coke has what 25 30 grams of sugar and more poppy on average is five grams of sugar and and it's got a little bit of fiber so how would you identify the people who are buying it were they buying it because they felt like it was healthier were they buying it because they like the taste or like what did you start to find out like about the people buying were they buying it for its perceived functional benefits or or for completely different reasons well basically we were able to lean into the brand versus hey drink this because it's better for you nobody likes to be told to do that they want to we were intentional with the consumer journey we wanted someone to see the can and be like that's so cute we wanted them to sip it and say wow this tastes amazing and then we wanted them to flip around and read the nutritional and say whoa this is better for me too so when did it start to become clear to you guys that you know and i'm assuming when you know when rohan got involved part of the conversation was well there's got to be an exit here right that maybe it's an acquisition or public or something like that and i imagine that once you hit 500 million maybe Once you get 100 million sales, you start to get interest in potential acquirers. Yeah, I think, you know, we've had one of the fastest journeys in sort of beverage history. We grew triple digits year over year until we sold, once we rebranded from Poppy.
You know, I think that we were in a really interesting period of time. We were operating in a COVID supply chain. You know, cans now cost 11 cents. We were paying 40 cents for a can during COVID.
We were shipping containers of essentially air, empty aluminum cans, all the way from China, just so we could fulfill the demand. So I really think that that was when, you know, we thought that we had something as far as an acquisition goes. But I think every year we just continue to see the business more than doubled. I mean, honestly, from day one when you were going to sell.
So, like, let's be real. So basically in the world of beverage and in particular soda, you have two avenues. You can sell to a big strategic or you can go IPO. Well, IPO is great, but you don't gain distribution partner like Pepsi.
So for us, we, let me just give you an example. We are the official soda of the Lakers and we're not allowed to be sold in that stadium because of contracts. So now us getting bought by Pepsi, which is incredible, we now can go from 50,000 locations to 350,000 locations, right? Because they have massive distribution.
I think it's not a secret. Pepsi acquired Poppy in March of 2025 for almost $2 billion, which was just incredible. I mean, between the time you launched in March of 2025, it was essentially five years. Correct.
And it's interesting. When we first started out, it was just us and our story. And Poppy for the first few years. And then a really big tipping point for us was doing our first Super Bowl ad where we really gained that cusp of we said we were a soda.
The future of sodas now. We kind of put, like, our flag in the ground. In our ad, we said soda 17 times and that we were the future of soda. And after coming out of that, our awareness tripled overnight.
We started getting some interest from the strategics, which was always the goal. And we kind of, like, went from mom and pop brand to challenger brand to established brand, which is real. And we did it really quick to your point in five years, which is absolutely unheard of. You know, we thought we were going to double the business from 22 to 23.
And instead, we 4X the business. And in large part, it was because of the Super Bowl ad. We planted our flag and we said, we're soda. And we'd also been seeing that with how consumers were repurchasing the products and the retention that we had.
But it was really, like, our big coming out moment. When Pepsi approached you with such a huge offer, I mean, it must have just been mind-blowing to imagine that that was going to be the outcome. Honestly, when you go through these things a lot of people don't know is you spend over a year. You meet them.
It's almost like a dating process. It's not like they just give you an offer and, like, two days later, you say, yes, let's do this. And their motto, which consistently is what we're still hearing, is let poppy be poppy. And I think as a founder, one of your biggest fears going through that is that the brand will lose itself or it'll change.
Like, I have all those fears. Our consumers have all those fears. And Pepsi just, I feel like the big strategics, they've done it wrong before. And they didn't want to do it wrong with poppy.
And so we just kind of, like, got that from them. And so it was stress. I've never felt sad, happy, stressed, excited, like, all within the same day, multiple days in a row for weeks, right? It does, like, a toll on your body definitely going through something like this.
I'm curious. As you were building the business, right, in the early days, you were a couple, right? And a lot of times, on this show, we've asked people, would you work with your partner? And there are different kinds of responses.
But I would say, and I work with my wife, but I would say a lot of people say, I'll never work with my partner. I can't. You know, it's too complicated. I mean, were there ever moments where your business relationship created tension?
Or do you think just your personalities are just naturally matched to make the business side work, too? Early on when, so, okay, early on when we were really early in mother beverage days, and it was really hard with working multiple jobs, having a family, while scaling a business, I remember I used to get really upset when Stephen wouldn't take time out of the day to get me flowers. Or why do I not get chocolate on Valentine's Day? And we finally sat down one day, and it was just like, we've got to pick, right?
Is it marriage, kids, or the business? And what do we, like, this is killing us. And I honestly, at that moment, we looked at each other and said, our marriage is great. We love each other.
We want to be partners. Let's focus on the kids in business and just know that we're good. And once we kind of let go of that expectation, a lot of the pressure went away. So then when he did get me flowers, it was extra special.
It wasn't because of a holiday. And so that was really early on in just, like, understanding that it was okay and that just to show up where we could. And I wouldn't do it again without him. Yeah, absolutely.
We'd do it over again. I think the biggest thing about Allison, and I think why we work, is because we're 100% committed at all times. It was really hard. Like I said, there was dark days.
We didn't have money. Like, we didn't have, we were technically unemployed. We weren't paying ourselves a salary. We didn't have health insurance.
And I think that we've done the best that we could and still very much in love with Allison and very much excited to do this in the future together again. When you think about the journey you took, and, you know, this really started in 2016, and here we are in 2025. It really started in 2020, we branded. And it's been a massive success.
I mean, how much of that and your journey do you attribute to the work and the brand? And how much do you think it had to do with luck and timing and circumstances of people being open to this product today? See that? There's a quote that's always top of mind for me.
The harder I work, the luckier I get. And so I really think it was a recipe that required all the timing, luck, hard work, grit, passion, intensity. It required all of those elements. Yeah, and for me, I really struggle with saying it was luck because we worked really hard.
I do think there were a lot of doors that opened that maybe a lot of people would say were really lucky. But I just know all the hard work that went into that. I think it was us knowing where to push, where to take the help, and kind of where to step back was a really big piece in allowing other people to come in and help, right? I think that it's a lot bigger, like Stephen said, of this once-in-a-lifetime generational brand.
Not a lot of people can say that they created a product that our kids and grandkids are going to know as soda. And I just think that's just so much bigger and cooler than saying we got lucky. That's Allison and Stephen Ellsworth, the co-founders of Poppy. By the way, Allison is heading back to Shark Tank once again for its new season, but this time she'll be a shark.
She's one of just two former contestants to ever appear in that role. The first one was also a guest on this show, Jamie Siminoff of Ring, which is a great episode, by the way. Hey, thanks so much for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show.
And if you're interested in insights, ideas, and lessons from some of the world's greatest entrepreneurs, please sign up for my newsletter at GuyRoz.com or search for GuyRoz on Substack. This episode was produced by Rommel Wood with music composed by Ramteen Arablui. It was edited by Neva Grant with research help from Alex Chong. Our engineers are Patrick Murray and Jimmy Keeley.
Our production staff also includes Casey Herman, Chris Messini, Carrie Thompson, Catherine Cipher, Carla Estevez, Sam Paulson, Andrea Bruce, and Elaine Coates. I'm GuyRoz, and you've been listening to How I Built This. I'm GuyRoz, and you've been listening to How I Built This.