DTC POD: Disruptive Sips: Building Iconic Beverage Brands from Scratch with Christopher Hunter

In this episode of DTC Pod, we’re joined by Christopher Hunter, Founder & CEO of Phusion Projects & Koia. The companies behind Four Loko & a plant-based protein drink skyrocketing over $100M in annual sales.

On top of that, Koia has recently partnered up with Starbucks, bringing their presence to over 30k retail locations nationwide.

So join us, as we hear about the risks of going direct-to-consumer that people don’t talk about enough; the importance of a few key partners in the early days; and Chris’ main tip for growing and scaling a CPG effectively in the long term.

3 Big Lessons from Chris

Lesson #1: The Importance of Key Partnerships.

You don’t need dozens of partnerships, just a few important ones.

The nature of Koia means it needs to be cold at all times. This made DTC a nigh-impossible market for the brand at the time.

That meant that they needed to go through retailers, and for that, they needed support that could legitimize the product and the company.

To deal with that, Hunter partnered with key partner #1: a major broker in the industry. They invested in the company and represented Koia at a national level– eventually helping in the pitch to Whole Foods, who would technically become key partner #2 as their first success story. This pitch went so well that they were in 30 stores from the start.

After much effort on the team’s part, the product proved itself; and growth continued through flavor innovation. To the point where currently, there are 14 flavors on the Whole Foods shelves. 

This success story eventually helped the pitch to other retailers. By the end of the first year, they were at ~400 stores, with ~1,200 the next. Scaling over time, to the point where they’ve reached 30,000 distribution points; most recently, Starbucks.

Lesson #2: The Risks of going DTC, and How to Maneuver it Effectively.

In today’s market, it’s rare to find a product that isn’t being sold directly through a company’s website. Or at the very least, through Amazon.

But Koia is a rare product; they’re a heavy, refrigerated beverage. Meaning the product is expensive to ship because of weight and overnight shipping.

For a while, they had a DTC pipeline in place. And it was relatively successful in terms of customer appreciation.

But once Chris found out that 80% of the marketing team’s time was being spent in customer service for this area of the business; and the amount of revenue it was bringing in, they decided to shut it down. This repeated itself during the COVID-19 pandemic.

Recently, customer habits have changed, and now they’ve become part of some of the clientele’s daily routine. As such, clients wanted to be able to buy the product in bulk.

One way they’re going about it is by making 4-packs for Whole Foods and Costco. Another is a multi-serve, 32oz bottle.

But they’re missing an entire market with at least 5000 monthly searches: Amazon. As such, they’ve started working on a shelf-stable solution to sell through the online retailer.

The product is largely the same, with the main difference being an increased amount of protein (from 18g to 20g), it’s also fortified with vitamins and minerals, and it comes in a 12-pack of Tetra Paks.

Lesson #3: Chris’ Tip for Positive Growth in the Long Term.

Chris isn’t shy about sharing that his mission with Koia was to grow the best product and company possible, to eventually sell it off.

And while that’s still a possibility, he admits that over time he’s learned that you can’t build a business to sell it off. Because while you make decisions that could facilitate that, they don’t create the best long-term situation for the company.

Instead, Hunter recommends building something you’re genuinely excited about. In his case, while building the Koia brand they went through many iterations trying to figure out what it is.

There was a “functional coffee” line for a while, and even a low-sugar smoothie line meant to compete with Naked and Bolthouse. And while they all sold well enough, none of them were as good as the plant-based protein drink.

Over time, with their trial and error & talking with clients, they realized that Koia stands for:

1. Delicious.

2. Plant-based proteins.

3. Low sugar.

And recently they’ve found the fourth, less expected attribute: fiber. This last one is what they call an “unsexy ingredient” which has started to matter to people and their diets lately.

Understanding this, they’ve been able to innovate in ways that are relevant to the brand. From the shelf-stable Tetra Paks, to the Koia kid’s line of drinks.

DTC Job Positions!

Area Sales Manager at Koia

Description: Lead sales growth in Miami/Florida region for Koia, a leader in plant-protein beverages.
Responsibilities: Build store relationships, visit accounts, drive sales, and merchandise, and influence retailers.
Benefits: $55K-$60K/year, car allowance, phone/wifi stipend, fitness stipend, benefits, and 25% bonus potential.

Director of Social Media at OLIPOP

Description: Lead OLIPOP's social media strategy and operations, ensuring alignment with the brand platform and marketing goals.
Responsibilities: Develop strategies, manage teams, analyze data, oversee campaigns, collaborate with departments, and mentor staff.
Benefits: $150K-$170K base salary + bonus. Remote work environment with a diverse and supportive team culture.

Manufacturing Process Engineer at Dr. Squatch

Description: Drive innovation in manufacturing and packaging processes for Dr. Squatch's natural men's personal care products.
Responsibilities: Oversee production processes, troubleshoot issues, manage projects, collaborate with cross-functional teams, and ensure quality standards.
Benefits: Base salary range $95K-$120K, full-time onsite role with company benefits, opportunity for growth and development.

That wraps up this week’s newsletter!

As always, reply any time with thoughts, questions, reactions, or ideas for future issues. And don’t forget to follow us on LinkedIn to unlock new episodes of DTC Pod each week!