Chris Hunter helped come up with the controversial caffeinated alcoholic drink. Now he’s the CEO of Koia.
In this ongoing column, The Digest, Entrepreneur.com News Director Stephen J. Bronner speaks with food entrepreneurs and executives to see what it took to get their products into the mouths of customers.
Four Loko is still on the market today — and apparently selling well — but Hunter, who was 25 when the brand was created, has since moved on to other businesses. His current pursuit is leading Koia, a plant-based protein beverage company. Quite the career pivot, right?
The beverage brand launched nationally in Whole Foods in 2016 and has since expanded to the shelves of more than 4,000 U.S. stores. It expects to have $10 million in sales for this year. Koia’s products include five flavors of its original protein beverage, as well as three fruit infusion flavors. The company plans to introduce a keto line in January.
Entrepreneur asked Hunter about his career shift, what interested him about Koia and his advice for launching a product.
This interview has been edited for length and clarity.
How did you go from Four Loko to Koia?
My life had evolved. I was in my early 30s and my first son was born. Life was just different than it was back then. I was looking for something I was a little more aligned with. Craft beer was really popular at the time, and it still is, so I found a small craft brewery outside of Chicago that was creating an alcoholic root beer. I formed a relationship with the creator and founder — essentially we brought in this company and brand under a subsidiary of [Four Loko parent company] Phusion Projects — and we created the brand Not Your Father’s Root Beer. We ended up selling that brand to Pabst shortly after.
At that point life was changing again, and my second son was born. He was born dairy intolerant, so we became a dairy-free household. My wife was studying to be a nutritionist. We were starting to eat a lot differently. My workouts were changing from when I was younger, from typical gym days to now doing yoga and triathlons. I was much more aware of health and wellness in general.
I started investing in some small, better-for-you companies and products, from meal delivery kits services to a product called Raw Nature 5, which was the original form of Koia. It just so happened that the product was in my gym, and I had been drinking it.
Why was an attractive product to you?
As I started to do my due diligence, Raw Nature 5 was a really bad name, and it had this really bad bottle and label. But it was selling really well. It was only in 30 stores in Chicago. I started to dig into it a little bit more. One store told us it was their best-selling product, and it was selling for six bucks a bottle. I stopped into a Whole Foods and noticed there was a good amount of shelf space dedicated to this product. As I was standing there, I watched a consumer basically pitch the product to another consumer.
A bunch of industry veterans, including Mark Rampolla who created Zico, invested in the product, so I invested alongside them. I was the local guy who had some entrepreneurial experience, so I formed a good relationship with Raw Nature 5’s co-founders. As they started moving along, the company got into a difficult situation — it was running out of money.
We collectively decided to pull Raw Nature 5 off the shelves, because it wasn’t a scalable product at that point. There wasn’t a process in place to sell it nationwide. But I believed in the product so much, so me and other investors decided to invest what was a significant amount for us. I talked about wanting to bet on myself and take the reins. So I came in to help pivot the company and co-found the new company and new product, which we collectively rebranded as Koia.
What can other entrepreneurs learn from your experience of launching into Whole Foods?
There’s multiple ways to go to market. I don’t know what’s right and what’s wrong. A lot of companies will saturate one particular market like New York or L.A. or wherever and prove out their story and then launch nationally. We were fortunate that we had an opportunity to launch nationally with Whole Foods. You can’t really turn that down, but it’s an expensive way to go. We had to take on investment and grow the company quickly.
My advice would just be to think through what you want the final outcome of your company and product to be and what route to market best fits that, whether it’s a regional build or national rollout.
What has been the company’s greatest challenge, and how were you able to overcome it?
The natural food beverage industry has a ton of new products launching, so it’s a crowded space and there’s a lot of noise around it. It’s a difficult route to market. How we overcame it is we added an extraordinary amount of support to any retailer that we’ve launched at. When we had the opportunity to launch with Whole Foods, we didn’t have the mentality of, “Oh great, we’re done, now let’s sit back and watch what happens.” We hired merchandisers. We did a lot of in-store demos. We did price reductions. We did everything in our power to make sure that consumers were exposed to the brand.
We made sure that the labeling really spoke to our selling points that there’s 18 grams of protein and only 4 grams of sugar in the entire bottle. That draws people in right away. They’re intrigued. We were confident that once people tried our product, they would like it and become repeat purchasers. That’s an expensive thing to do, but I believe that’s the right way to go to market.
Where does the name Koia come from?
As we came up with the name Koia, we used a branding agency, and looked into our belief as a company and what we wanted to stand for. We honed in on blue zones — places in the world that people live longer than others. What we started to look at is there’s these five common trends with people that live in blue zones. One of them is they eat a primarily plant-based diet, which clearly fit with Koia. It fits with our mentality as a company. The name Koia is derived from one of those blue zones, the Nicoya Peninsula in Costa Rica.
What is the most unusual thing about working in this particular niche?
What’s interesting to me that it’s such a small industry. It seems like everybody knows each other, but it’s also such a friendly industry. I’m just shocked at how many other companies and brands we collaborate with are open to doing that. Other companies we talk to share their stories of successes and failures, and we try to figure things out together.
How do people react to your past with Four Loko?
People want to understand how I went from that to this, because it’s pretty opposite ends of the spectrum. To me there’s no right or wrong. I’m not ingrained in one way of eating or drinking versus another. It’s about options. What it ultimately boils down to that I like to work on things I’m aligned with, and Koia is aligned with my life and my lifestyle right now.
This article first appeared in www.entrepreneur.com
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