[00:00:10] Ray Latif: Hello friends, I'm Ray Latif and you're listening to the number one podcast for anyone building a business in food The Beverage, Taste Radio. This episode features an interview with the legendary Ken Sadowsky, a man who needs no introduction, but we'll give him one anyway. He may be nicknamed The Beverage whisperer, but when Ken Sadowsky speaks, he's heard loud and clear. A longtime industry advisor and investor, Ken is one of the most respected and influential leaders in The Beverage business. He cut his teeth working with his family's distribution company based in Auburn, Massachusetts, and is currently the executive director of The Northeastern Independent Distributors Association, known as NIDA, a group of wholesalers that operate in states from Maine to Pennsylvania. Ken is also a senior advisor with Verlinvest, the Belgium-based investment holding company founded by the owners of Anheuser-Busch InBev, which holds stakes in Oatly, Vita Coco, Hint Water. He's also personally invested in and an advisor to several beverage companies, including LifeAid, Icelandic Glacial, Recess and Dyla Brands. This episode is the third of a trilogy with Ken, who also joined us for conversations in 2016 and 2019. Surrounded by two dozen or The Beverage brands, Ken and Ray sample drinks representing fast-growing, bleeding-edge, and established categories, including better-for-you sodas, cannabis libations, non-alcoholic cocktails, and shots of the juice variety. As we sip our way through the various sized cans and bottles, Ken shares his perspective on trendy concepts, package design, formulation, his investment thesis, and successful go-to-market strategies. Hey folks, it's Ray with Taste Radio. Right now, I'm supremely honored to be sitting down with the one and only Ken Sadowsky. Kenny, how are you?
[00:02:24] Ken Sadowsky: I am fine, thanks. It's really great to be here and always good to be sitting with you, sometimes better at Fenway Park and sometimes not. So happy to be here.
[00:02:33] Ray Latif: Yes, we've been to a couple of games this season. Thank you so much for inviting me. Last game we were at was only a few days ago. Unfortunately, the Sox were not the victors in that contest, but great game nonetheless. It's always fun on a nice day to be in Fenway. Yeah, absolutely. Absolutely. Nice day to have you here in our basement at BevNET HQ in Newton, Massachusetts. And we're surrounded by products that you and I have invested years of our lives in, and that's just beverages in general. But I think we have about, I don't know, 15, 16 different brands, maybe more, on the table here. And a few of them are from across the pond, as it were, in the UK, and then A few of them are based here in the United States and I wanted to taste as we go and talk about some of the products, some of the brands, trends, categories, et cetera. But before we do all that, now, how many years is it that you've been in this business? Cause your family, and I know our listeners are probably familiar with your background, but your family started out in distribution, but you personally have been in The Beverage business for how long?
[00:03:39] Ken Sadowsky: Well, I think my first paycheck in The Beverage business probably came in 1983 before I graduated from college. I was hanging neon signs as a merchandiser at Atlas Distributing in Auburn, Mass., a town that you're very familiar with. Very familiar with, yeah. So, yeah, I mean, it's a long time.
[00:03:59] Ray Latif: By my count, that's 41 years, which is a pretty impressive run that you've had.
[00:04:06] Ken Sadowsky: Or embarrassing to say that I'm still doing this after this many years, but it's all been enjoyable. So yeah, let's go with it's been a good long run.
[00:04:15] Ray Latif: Distribution, investment, advisement. You're not a formulator though. I mean, you would think though that you have a pretty good palette at this point.
[00:04:24] Ken Sadowsky: I would say I have a relatively good palate as far as what the American population wants and will accept. And certainly it can be tricky as much as people read about the vilification of sugar, for example, and I'm a proponent of the vilification of sugar. You know, there are times when, you know, I still look at the sales of Mountain Dew and Coca-Cola, and it's hard to argue with the volumes that those guys are doing. But we are more focused at my stage of the industry and what you guys cover really well. What is the tip of the spear and how can this go from sort of the core consumer to the more consumer? So it's really fun to be at this stage of looking at all these cans and tetras and bottles in front of us.
[00:05:14] Ray Latif: I wouldn't make a direct comparison to you and the music producer, Rick Rubin, but I would say there are some similarities in that you understand what could be popular, what will be popular, what will sound good, what will taste good to the American consumer. And he has talked about this. I saw a segment with him on 60 Minutes and they asked him, the interviewer asked him, you know, how much do you know about production? How much do you know about mixing music and being on a soundboard? He's like, nothing. I don't know anything about that. It's kind of like formulation, right? It's like, I don't know how to formulate The Beverage, but I can definitely tell you what tastes good, what's going to work, what's probably not going to work.
[00:05:53] Ken Sadowsky: Yeah, I would say that's a good analogy or anecdote about the comparison. Yes. I mean, I did get approached in the last couple of weeks about, you know, who do you know that can formulate The Beverage? And I really don't even know that many formulators. I certainly know a few freelance formulators, but I don't have like companies that wanted to go into a private label thing that was in need of a formulation. Like it wasn't a raw material, for example, like a private label coconut water. You don't need a formulation there. It's just, you know, is there capacity at wherever you're looking to get the product? But this was a, well, one was a coffee and one was a kombucha. And so I really don't know. I mean, I certainly am one or two texts or phone calls away from getting to somebody, or as they say in Rhode Island, I got a guy. But no, it's certainly not what I do.
[00:06:50] Ray Latif: Is that a phrase specific to Rhode Island? I didn't know that.
[00:06:52] Ken Sadowsky: That was where I first heard it.
[00:06:54] Ray Latif: I know a guy who said, did you say that to me at the Red Sox game? Yeah, I think so. I was just like, where did I hear that recently? It was like, oh yeah, of course, Kenny said that. And you said something earlier about sugar and, you know, the vilification of sugar and how, you know, most RTDs these days are still formulated with a lot of sugar. And I think marketing has a lot to do with that too. And I think just, general education about how bad a lot of sugar is for you hasn't still somehow trickled down to a good amount of the American public. But the replacements for sugar, or at least the alternatives to sugar, can be very divisive. From stevia to monk fruit to erythritol to allulose, it's all this interesting mishmash of sweetener systems that have divided a lot of people. Is there one that you would say has worked better than others?
[00:07:51] Ken Sadowsky: No, I think one of the differences to the sugar substitutes or non-nutritive sweeteners that you referenced or alluded to is like some of them don't stand up to ultra hot temperature pasteurization. So you can't use it in, say, an iced coffee RTD because it's got to be, even if it's HTST, high temperature, short time. There I am, you know, talking like I'm a formulator, but I'm not. But, you know, there are different sweeteners that hold up better to ultra hot temperature pasteurization than there are some that, hey, you know, we can do this because we've got a juice based product. We're trying to cull some of the calories out. We're going to put a non-nutritive sweetener in there and we're going to produce it aseptically. So it's not going to have to stand up to the heat. So I do think there's a number of good non-nutritive sweetener alternatives. And then it just gets strange to me, like allulose being banned in Europe and allulose not being allowed in whole foods. Because some of the stuff that I've read says it's the best one of the ilk. And then there's obviously stevia that has evolved over time. The first one was Reb A, and don't ask me to pronounce the whole verbiage there, but, you know, they're now going down the alphabet, and like Reb G and Reb M are certainly less bitter with less of that lingering aftertaste. So, I mean, there's a lot of stuff going on there, and I'm fascinated by it. Obviously, you know, having my involvement with Hint, I think it's great if people can have no sugar, but then I think there's also brands that are out there that are just bright enough using regular sugar, but not, you know, copious amounts of regular sugar. And I see you looking at that Chamberlain Coffee and that was, uh, I mean, that's a really interesting example because. They went with Whole Foods' preferred formulation and did this less sweet thing. They put the same SKUs into Walmart and Walmart agreed to it at the beginning and then Velocity wasn't there. And so... Proactively, the leadership at Chamberlain went to Walmart and said, look, we're not happy with this. Let us brighten it or add sweetener, in this case, sugar. We think that's a better fit for your customers. And so far that has worked.
[00:10:18] Ray Latif: It is such a strange thing because they have a button above the logo on this can of Chamberlain Coffee's Mocha Latte, which is made with oat milk. And it's a green circle that says, sweeter recipe. When have you ever seen such a thing? This is really interesting. Let's open this up if you don't mind. No, I haven't tried it yet, actually. Kenny brought this over for us. You know, the brand I was thinking of actually, when you talked about sugar in coffee, was a brand new one called Throne Sport Coffee that was founded by a former Vital Water and Body Armor executive, Michael Fideli, and is backed by the NFL superstar, Patrick Mahomes. People may have listened to that interview that we did with them on Taste Radio, but let's taste Chamberlain Coffee since it's in front of us right now. Cheers. Cheers. I mean, it's great. It's still not as sweet as I expected it to be. I was expecting a much sweeter coffee, but this is great. I think it's well done. Yeah. It's got 13 grams. My eyes are going. 13 grams of sugar per 11 ounce can. These are slim cans, which isn't bad. According to the FDA, 13 grams of sugar, including nine grams of added sugar. Nine grams of added sugar is 18% of your recommended daily value or allowance of sugar. Speaking of coffee, you know, cold brew was like the hottest trend. It was like kombucha, cold-pressed juice, cold brew, like in the mid 2010s. That was everything. Those were the hottest categories. Cold brew coffee now seems to have, I don't know, hit the skids.
[00:11:56] Ken Sadowsky: I think there's a number of ways of measuring that. One of them certainly is what's in the stores. And that category, again, has sort of segmented or morphed. Because I remember the original ones were all concentrates, right? And then it went to an RTD format. And yeah, I mean, it certainly could be said that what's going on at sort of MULO, meaning all the multiples, is not growing as quickly as it could be or should be. And I do like the category in general. But then I think the other thing that has happened is places like Cafe Nero have gotten better at it. And even Dunkin' Donuts has gotten better at offering cold brew as an option when, you know, what I would say an RTG, right? A ready to go, not really a ready to drink, but I mean, people are buying it in cafes.
[00:12:46] Ray Latif: That's a good point. In the multi-serve, I see more people buying multi-serve cold brew and just drinking in the morning, saving money, obviously, instead of going to a Starbucks or a Caffe Nero. And time. Yeah, and time. But the RTDs, the single serves, seem to be less popular, at least less distributed than they have been in the past. And it was like every week we'd see two or three new brands come to market. That's not the case anymore. The category where we are seeing two or three brands come out every week is in, can you guess? Is it prebiotic? No, good guess. Better for you, Soda. I think we're going to go there momentarily, but no, it's non-alcoholic cocktails. Non-alcoholic cocktails. AFs. Yes, AFs, exactly. And I have a few of them on the desk here. And, you know, these are brands that have been around for a while, like a De Soi, like a Little Saints. And then there's relatively new ones like Elapo's, L-A-P-O apostrophe S, which makes a zero proof Negroni, which is fantastic. I would be a fan of that.
[00:13:49] Ken Sadowsky: If done properly, I would be a fan and I might have a flask of gin with me for the next.
[00:13:55] Ray Latif: Well, let's open this up. And while I open it up, I'm curious. I mean, this is still. the very early stages of a very bleeding edge category. And I think there's just a sort of gold rush land grab for a lot of these brands at this point, but does it have legs?
[00:14:14] Ken Sadowsky: I think the answer is yes, but right now what I would say is there's more sizzle than steak. They need to find they, meaning the category needs to find their footing. I think there are still so many questions unanswered, like where do they go in the store? What stores should they be in? I mean, you guys have done a great job of covering the highs and lows of Wausan. And then different retailers are taking different sort of attitudes, like, you know, we're going to put them in with mixers. We're going to give them their own section in The Beverage aisle. You know, Total Wine has a destination set up for them. I think there's still a lot of discovery that has to happen. And of course, I'm talking about sort of the traditional retail discovery. How are these people getting the message out at the right places? I mean, if you look at craft beer, 30, 40% of it is done discovery in the on-premise. How does that have a place? And I remember the original presentation that happened at BevNET by one of the distill venture guys, Dan Gasper. And he talked about all the findings between the price point having to be the same. So these categories, irrespective of the cost of the ingredients, they have to be. a price point where if people are going out and drinking together and they're going to split the bill up at the end of the night, the person that was drinking either bottled water or soda is going to feel like he or she got gypped when they have to pay one quarter of the bill if there were four people drinking. So they wanted seed lip to be an elevated price point. And the other thing that they did was have it be bitter and complex in its flavor profile so that it didn't take 30 seconds to drink your drink. It took roughly the same amount of time. So I get the on-premise piece of this, but I think these... RTDs in this alcohol-free category are really important for two reasons. One is discovery can happen at home or in an on-premise environment. The other thing is when you look at the 750 ml bottle as a form factor with mostly the mimics, I guess, That has a really limited shelf life. So you can't sell those to an individual at home unless they're coming home and drinking these and then putting it in the refrigerator. Because the shelf life, alcohol is the preservative in alcohol. And so if it's alcohol-free, you've got a short shelf life situation to deal with.
[00:16:45] Ray Latif: All good points. Let's toast to some Lapos Negroni. I mean, we've talked about this on the podcast. This is a really solid product. I do think to your point about drinking it really quickly is a good one because I can drink Negroni pretty quickly, but I try not to for obvious reasons. When it's a non-alcoholic, I think you tend to drink it faster. And that's where the bitter component, I think it kind of holds you back from just pounding it. But I think the bitterness in this is pretty great.
[00:17:15] Ken Sadowsky: They've done a really good job. It's a linger and it's at the end. And it's not a old version of Stevia Reb A linger. It is really just the way it's a Negroni supposed to be. So I may have nailed this.
[00:17:30] Ray Latif: Yeah, it's made with organic cane sugar, gentian root extract, blackcurrant juice, concentrate, clove extract, bitter orange extract, and a bunch of other things as well. Yeah, as far as the Negronis that I've seen on the market, the non-elk Negronis, this one is top of the list.
[00:17:48] Ken Sadowsky: I haven't tried that many of them, but this one is really well executed. And, uh, if I were a formulator, I would probably know what that flavor is. That's that, uh, lingering bitter at the end, but I'm not.
[00:18:01] Ray Latif: But you're an investor, uh, in brass tacks. I mean, has anything moved you to be interested to write a check in this space?
[00:18:09] Ken Sadowsky: Full disclosure, I am a small investor in Parch and I like the team and I like the liquid. And I just really, I enjoy the product and the packaging is, they nailed it, but it takes more than just nailing all of the known scientific, if you will, metrics to make a great product. You need to have a Little Saints of luck to get to success.
[00:18:35] Ray Latif: Did it help that one of the co-founders was a former executive at a big alcohol conglomerate?
[00:18:40] Ken Sadowsky: Sure. That helps with things like what not to do.
[00:18:43] Ray Latif: Yeah.
[00:18:43] Ken Sadowsky: So yeah, I mean, those were compelling things, but you know, after doing several phone calls with both of them, it was one that I just said, this is worth putting a chip in.
[00:18:55] Ray Latif: Although he's never been an entrepreneur before, neither co-founder has, as far as I know, at least in The Beverage industry. And even though you may have all the experience that you got at a big company, being an entrepreneur is a totally different experience, I would think. Does it give you pause though, when you are talking to an entrepreneur that has zero experience versus some that has at least some experience in The Beverage industry?
[00:19:22] Ken Sadowsky: I mean, I think there are so many places that one could pause, that you could get into analysis paralysis and never write a check. So at some point you just have to bet on you know, the project and the project is really led by the people. And then do you think they have the intestinal fortitude to survive all the hits that they're going to take on the journey? Because it's never just a straight shot rise to the top. Corporate America is good training. So I just think that in this case, I am definitely backing the people and the project.
[00:20:00] Ray Latif: I hear from entrepreneurs all the time, successful ones, that naivete is great. They probably wouldn't have done what they did or bang their heads against the walls as often as they did if they weren't as naive as they had been. But I don't know any investors that have said naivete is a good thing.
[00:20:18] Ken Sadowsky: No, I think it is a component. What one can glean from big corporate America is good techniques, but one has to be more nimble when they're getting into this world. But the naivete of, you know, hey, let's not look at 17 different ways that this could wind up. Let's just say the way that we are thinking about this is the way it's going to play out. And when it does, it's great. And when it doesn't, if it doesn't, then you just want somebody that's got enough gray matter to either pivot and do something smarter or reach out to people who have done it before and get some insights. But every journey is different. And it's, you know, I get asked this question a lot, like, you know, when do I do this? And at what point do I do this? And I say, you're asking me like there's a textbook about how to succeed in The Beverage business. And my answer to that is, this is more of an art than a science. And my other answer is, if it were a science, someone smarter than me and before me would have written the book on how to get this done.
[00:21:28] Ray Latif: Yeah, well, there's been a couple of books written about The Beverage industry, but each experience is very different. I think about Mark Rampolla's book and the Honest Tea guys with their book, both excellent reads, but, you know, very individual experiences. Some things you can pull from there and say, yes, these are very basic, fundamental things that you need to do to be successful. But at the end of the day, it is very much an individual journey as you take it. Can I put you on Throne Sport for a second? Certainly. Okay. Our 2023, BevNET's 2023 brand of the year. Do you know what that was? No. Prime. Oh, the brand that kind of came out of nowhere. That surprised a lot of people, a lot of analysts, a lot of other corporations. I mean, it's a Congo brands founded or at least run brand. It is Logan Paul and KSI who are the quasi founders of the brand. And it has just been a rocket ship until recently, until last few months. And we published. an Instagram reel, I mean Taste Radio that is, published an Instagram reel about the rise of Prime. And I think you left a comment on that that said, just wait. What did you see? about Prime's potential for these declines that it's experiencing right now that I think other people did not, myself included.
[00:22:46] Ken Sadowsky: I would say it was twofold. One thing that I say is when a brand doesn't know how and why it got to those heights, it's really difficult to maintain those. When you've exuded discipline and, you know, used your findings to build a foundation, it makes it that much more sustainable. That's one thing. And then the other thing is my background is DSD distribution, and this Brain Wash going through mainly DSD distribution But none of the distributors to whom I spoke had nice things to say about Congo. It was sort of, hey, these guys are, you know, while they're on fire, we are happy to distribute their product. And they were disappointed they couldn't get more product in the summer of 23, I guess. And then when the relationship is not that great, as soon as something starts going poorly, those same distributors are going to be like, I remember how they treated me and how they're still treating me. And they're not going to go the extra mile to get that extra display and do the things that make brands top of mind for consumers. Now, again, I don't want to be too much of a Jurassic answerer here because there is all kinds of social media and all the other things that digitally can keep a brand afloat and on fire and top of mind. So I guess I'm speaking about this more in the what I see doing my store checks and traditional distribution.
[00:24:21] Ray Latif: Keep your distributors happy is an important part of this business. And you just outlined very much why. Yes, prime, huge hit among Gen Z, Gen Alpha consumers. Somehow the branding, the social and digital visibility of the brand has been huge. But yes, on a fundamental, how do I get this brand into stores? How do I support it on shelf? That's really what keeps brand on its rocket ship.
[00:24:49] Ken Sadowsky: From my past experience, which again doesn't portend the future, but from my past experience, that is what it has taken to stay successful. And the other thing I would say that, you know, just speaking to some of my friends who had teenage kids, They were saying like, well, you know, they want to be in school with it in the netting part of their backpack. So they have one, but they don't care what's in it. Like they're refilling it Hint Water if they can't get more. So they liked the liquid, but it wasn't the deal maker or breaker. It was, I just want that bottle. And that's not a great way of, you know, adding to revenue. Yeah.
[00:25:29] Ray Latif: I mean, it was a mind-blowing thing that people would be putting empty bottles or selling empty bottles of Prime on Craigslist and people buying them. Obviously, they're not doing that now. But yeah, there will be a story, a study about the rise of Prime. I wish them all the best. I don't want to be like, oh, you know, they deserve what they're getting or whatnot. But, you know, the rapid rise was something that no one expected. No one really saw coming. And hopefully they can reverse their current trajectory.
[00:26:00] Ken Sadowsky: Yeah, well, and Congo Brands is not a one trick pony. I mean, the Alani Nu brand is doing well. I think the key for that brand is can they move over to a more male consumer because they've been really high indexing female. but it's good liquid and I think it just, you know, their opportunity is still there, but it's a Little Saints different than, you know, the isotonic category that Prime plays in. So, you know, I'm not talking at all about the health of Congo, but it is funny because as my sort of Verland vest hat, Last summer, I got calls from people not in the U.S. asking me whether Prime was investable or purchasable. And I just said, I would take a big chill pill and wait a year and see where it is. And I think those people, I mean, they're not sending me thank you notes, but I think they should be.
[00:26:58] Ray Latif: I was going to say, did they send you a check? Maybe they should have, because you probably saved them quite a bit of money. Female consumers, it's interesting you brought that up with Alani Nu, because that's kind of the secret sauce for Alani Nu, is they found a whole new set of consumers that a lot of the big energy brands were ignoring, and that's female consumers. And that's where the brand seems like it's very much targeted or who it's targeted for and who it's appealing to. And I think about some of the brands here on the table and I'm looking at, and there's a handful that I think kind of lean one way or the other, at least in terms of male and female consumers. But it seems like in this day and age, you kind of have to be gender neutral. That's the best approach to package design. I completely agree.
[00:27:45] Ken Sadowsky: I mean, I remember there was an energy drink called Her a while ago, and I just said, why do you want to alienate 50% of the population? And it was very female-focused. And look, maybe it was just ahead of its time. Maybe if it were launched today, it would be a competitor of Alani Nu. I just don't think that something that heavily leaning to the female side, or the male side, but in this case her as the female side, I just don't think it's... investable, at least for someone like me, like why alienate 50% of your audience right off the bat? Or I don't know, what's the number, 49%? There's 51%? I think it's 51 female, at least in this country, yeah, and 49 male.
[00:28:31] Ray Latif: That being said, I don't see many people buying, many guys buying the Olipop Barbie limited edition product, which I have in my hand here.
[00:28:39] Ken Sadowsky: I look forward to trying it, but yeah, I think, you know what, it conjures up images to me of if a guy bought one of those because they really liked the flavor, then it would be like the old SlimFast can days where for every bottle Slim Fast that was sold or can, there was a brown paper bag in the same size commensurate to the volume.
[00:29:02] Ray Latif: Now half of our audience doesn't know what we're talking about because Slim Fast such an aged brand or old brand at this point.
[00:29:08] Ken Sadowsky: But the category is existing and morphing and actually coming to more the fore with the GLP-1s. But yes, before I get too far off the rails.
[00:29:18] Ray Latif: Come back. So we're gonna hit two birds with one stone here because yeah, I want to try this lollipop I actually full disclosure. I drank this when I was doing an interview with the founders of lollipop Ben Goodwin and David Lester Hope everyone had an opportunity to listen to it because it's a great interview great conversation I shouldn't say I shouldn't pat myself on the back it like that's ridiculous. Sure. It was a great interview I enjoyed the conversation very much This is a peaches and cream flavor, limited edition. And let's try it. They do one of these in the past. It was a banana cream minions variety or a banana cream flavor associated with the, what was that? What's the name of that movie?
[00:29:56] Ken Sadowsky: It's not called minions. No, it's well, actually some of the corollaries were some of the, you know, added ones, but yeah, what was the, I forget. I mean, they were the, they were in the first movie just going BD.
[00:30:07] Ray Latif: Yes, exactly. Yes. All right. So Ollie pop peaches and cream.
[00:30:11] Ken Sadowsky: Here we go Well, I mean just personally I must say I'm impressed because I think that's the first time since my elbow surgery that I drank something with my right hand I've been drinking with my left hand It's nothing to do with the liquid it's all about the elbow here, but you did her personal pride You did drink the whole thing. I drank the whole thing of all of these.
[00:30:34] Ray Latif: Okay, I
[00:30:35] Ken Sadowsky: But yeah, look, the liquid tastes fine. I'm not crazy about the aftertaste, but the liquid tastes fine.
[00:30:40] Ray Latif: Yeah, it's obvious there is a alternative sweetener in here, that of Stevia. And I think Stevia is the only alternative sweetener in here.
[00:30:51] Ken Sadowsky: Do they call out whether it's Reb A or Reb M or is it just Stevia?
[00:30:55] Ray Latif: It just says Stevia with an asterisk after it and the asterisk stands for extract. But there's a bunch of juice in here. So there's peach juice, there's apricot juice, there's cassava root syrup. So there's some of that in there. There's apple juice concentrate, lemon juice. So we know obviously not all the sweetness is coming from the Stevia. Correct. But, um, I mean, talk about a rocket ship. Olipop is expected to do $500 million in revenue this year. They're a profitable company. They're distributed pretty much everywhere. They're in 35,000 retail locations. I'll be completely honest, Ken, I did not see this coming.
[00:31:37] Ken Sadowsky: Yeah, there are some categories that I just, uh, watch and wish them the best, but I am not going to be involved and didn't get involved in this one. So yeah, I mean, it's, uh, it's surprising to me and I think they've done their build in a more sustainable way. And also in this case, used their lack of shelf stability to their advantage because they got chilled, uh, placement wherever they went.
[00:32:05] Ray Latif: Yeah, that's a really good point. But I think in general, the better for you soda category, the better for you sparkling beverage category, aside from the, you know, the ones that have a functional benefit. It's something that's been really interesting to watch. I mean, you know, the children of Ollipop and Poppy, I guess you would say, are, you know, products like these. So Evolution Fresh, which is a longtime maker of cold press juice products, recently introduced a new real fruit soda. I got to tell you. Whoever painted their cans did not do a great job. Evolution Fresh should get their money back. Good lord, look at this thing.
[00:32:44] Ken Sadowsky: It also looked like it had a hard time in shipping over here. The can's pretty dinged.
[00:32:48] Ray Latif: Yeah, the can is pretty dinged. Actually, and I take it back, these do contain pre and probiotics. They have five grams of sugar, they're made with real squeezed fruit juice, and they're organic. They do contain stevia. Do you want to try these? Sure. Okay, let's try. This is their tropical mango variety. It's a real throwback here. Orange mango, the Nantucket Nectars special. Yeah. All right. So I have yet to try this. I saw this in my local stop and shop in Brookline. Smells good. Yeah, about two months ago. And I was like, haven't I seen these before? But I guess not. Ah, cheers. Smells really good. I would never describe this as a soda though.
[00:33:31] Ken Sadowsky: No, I don't think so. It's sort of a, I guess I would call it a sparkling juice. But they have done a better job of mitigating that stevia potential linger. And again, I just wonder, when I taste something like this, oh my god, no wonder you can't read it. It's not hit well. It's like they missed.
[00:33:53] Ray Latif: Yeah, no, the whole thing is the whole can is blurred.
[00:33:55] Ken Sadowsky: I don't know how they yeah, that's uh, it's a problem Well, I mean the night shift was drinking when they hit this one Well, it doesn't say just that actually has the exact same verbiage as Ollie pop
[00:34:08] Ray Latif: Yeah, this one contains 18% juice. Again, there's a functional benefit in terms of pro and post biotics. You know, we saw recently Nixie, a brand of sparkling waters led by the founder of Late July, Nicole Dawes, a Tulane alum. Oh, really? I didn't know that. Go Tulane.
[00:34:27] Ken Sadowsky: Yeah.
[00:34:28] Ray Latif: Yes. And a New England resident as well. And her dad started Cape Cod Potato Chips. Yes, indeed he did. She's legendary. Yes. Nicole is amazing. But there's a lot of people jumping into this pool. It just seems like the Holy Grail of categories is finally here, perhaps. I mean, there was always this, oh, is kombucha going to replace soda? Declining soda sales. For a time, it was the craziest thing. And I was always pooh-poohing this. Oh, you know, drinking vinegars, drinking vinegars are going to be, you know, take a big bite out of it. Come on, man. But now, low sugar, mid calorie sodas seem to have gotten a foothold, seem to have gotten a lot of interest from the strategics. Feels like it's here to stay.
[00:35:11] Ken Sadowsky: Again, I wouldn't go that far. What I would say is that when the industry was really focused on the kombucha and really focused on several other things that were not sweet, what I said was, if the youngest consumers coming into this category are educating their palate into something other than sugar, and it could be sour and it could be bitter. And I think those are all things that will help the next generation not need GLP-1 drugs if successful. I was optimistic. I can't say my level of optimism is still there. I think it's still Americans go back to they'll talk dry and drink sweet. So those things that you mentioned before, they've had a moment, and I don't know if that moment has paused and then will take another leg up, or if it will sort of say that, hey, we reached our apex, we've got our zealots or our core consumers, and we never transferred to the more consumer. So it will be interesting to see. But again, I was optimistic about Americans using other parts of their palate to get away from sugar.
[00:36:29] Ray Latif: The Beverage category, emerging beverage category, that I am not a consumer of, so I wouldn't know how much sugar is in it, are cannabis beverages. Cannabis beverages as a category seems to be one that a lot of people are paying attention to. More and more consumers seem to be interested in, especially, obviously, in states where you can buy it legally and you don't necessarily, in some places, don't even need to go to a dispensary to buy it. Minnesota. Yeah. Are you a cannabis consumer? I mean, is that too personal to ask?
[00:36:59] Ken Sadowsky: It's not too personal to ask and without trying to sound like Bill Clinton, I don't think I've had any since it was legalized.
[00:37:06] Ray Latif: You're an illegal consumer of cannabis. That's right. Okay.
[00:37:09] Ken Sadowsky: Let's talk about college.
[00:37:11] Ray Latif: You know, I have a couple here on the table. Let's, uh, let's, let's pull a few. First we have milonga, which is a hemp infused tea. It's a yerba mate based tea that's made with five milligrams of THC and five milligrams of CBD. Remember when CBD was a thing? Oh, yeah.
[00:37:28] Ken Sadowsky: Well, look, I'm still an advisor to Recess, so I don't think that's over. And I still like that founding team and founder.
[00:37:37] Ray Latif: But I did an interview with Ben Witte a couple of weeks ago, or at least we published it a couple of weeks ago. And he told me that CBD is about 5% of the business at this point. Most of it. is their magnesium drinks, or is there, it's coming from their magnesium drinks, and their Zero Proof, which I'm holding there. This Island Spritz variety, holy moly, I can't get enough of this.
[00:37:58] Ken Sadowsky: I've not tried that one yet, actually. Really? Yeah.
[00:37:59] Ray Latif: Let's pop it open. Perfect. After you tell me about this Milonga.
[00:38:04] Ken Sadowsky: I guess what I would say is I do.
[00:38:06] Ray Latif: Oh, it's not cold. I'm sorry.
[00:38:07] Ken Sadowsky: Yeah. No, but, well, actually that's the way things are supposed to get tasted because the closer the temperature is to ambient, the more flavor comes out. So when I'm tasting something, like if I'm, if I'm literally an investor in it, I may drink it cold the first time. The second time I'm having it ambient.
[00:38:27] Ray Latif: Yeah. I've known you for a long time. I never knew that that's what you do. Interesting.
[00:38:32] Ken Sadowsky: Yeah, the liquid tastes fine. I'm not getting a whole lot of acai or mint.
[00:38:38] Ray Latif: That is the flavor that they're promoting there.
[00:38:41] Ken Sadowsky: But I can tell, I guess, that it's a yerba mate derivative. I don't think I would say, you know, this tastes like a guayaquil or a yerba, but I know it's not the rezon d'etre, if you will. So the five milligrams I have no idea what that does. I'm not drinking the whole thing, so I'm not going to find out. But I mean, the liquid is fine. There's no stevia linger. There's no, I mean, there's nothing offensive about this. It's definitely drinkable or sessionable or whatever term you want to use.
[00:39:14] Ray Latif: This is a second interview in a row. I did one with Taylor Foxman earlier this week, and we talked about cannabis beverages and I brought up a tweet that someone who is The Beverage observer and advisor posted, I don't know, it was a few months ago, and he had said, beverages will be the most consumed medium or, I don't know, product. Delivery system. Delivery system for cannabis in the future. Beverages will be the way that most people consume cannabis in the future. And John Craven, our founder and CEO of BevNET, doubled down and said, yes, I agree. Would you agree? I'm too stupid to agree.
[00:39:59] Ken Sadowsky: I see the reason for that statement and I understand sort of the extrapolation because The Beverage aisle is the busiest aisle in a supermarket. And I guess I completely understand it. And I also, you know, I get that, like, I'm also an advisor and investor in Nulixer, for example, which is a nano encapsulation. So I do know that the technology exists to keep the efficacy. like really honed in. And I think that's one of the things that is good about this industry is they're taking a laser focus on, okay, we're going to deliver this much. I don't know if that's analogous to a gummy or, you know, something like whether it's a bud or pre-roll or whatever. So I just don't know if those things can be honed in on and if the occasion, you know, is legal. Like if Massachusetts, you could walk into a bar and order one of these and you know what the onset is going to be, like this is five milligrams, you are going to feel it in 15 minutes. So you're not going to have three of them in 15 minutes and then go, I can't feel my legs. So look, I get the rationale. I don't know enough about it to opine intelligently.
[00:41:15] Ray Latif: Fair enough, but it seems like there is a big opportunity at just how big and how many people are going to partake in that opportunity as well. I mean, for someone who drinks beverages for a living, essentially, I'm still on the fence.
[00:41:30] Ken Sadowsky: I get it. I mean, I've never consumed an entire one to get the experience. I've tasted them as a judge of the showdown or just now, but I mean, I've never bought one. I've had stuff sent to me. I think the first one I got sent to me was Louie Louie and it came with a really big warning like, this is not soda.
[00:41:49] Ray Latif: Yeah. Louie Louie is a British brand, isn't it? Is it based in the UK or am I wrong?
[00:41:53] Ken Sadowsky: I don't know. No, I think it's here.
[00:41:54] Ray Latif: Yeah. I saw it. There was a Bevanette event that we did with Snackshot just before Expo West 2022. And that's the first time I saw that there. You brought, I mentioned the UK, you brought a bunch of stuff from the UK. I want to sample a few of these.
[00:42:06] Ken Sadowsky: Okay.
[00:42:07] Ray Latif: The thing that stood out to me, going back to soda, Living Soda. This is first F-H-I-R-S-T. And actually, you know what? I think I have tried this and I do like it. So maybe we don't need to open this just yet, but there is a lot of copy on the back here. If I had to guess, there's probably 400 words of copy on the back of this can. It's just too much. I'm sorry at first, but it's too much.
[00:42:32] Ken Sadowsky: Yeah, well, look, I like the liquid. I met the guy at BevNET Summer 23, and he's got a good head on his shoulders. And then his London-based chief operating officer or general manager is the sister of the guy that ran Vita Coco the UK when we really started flourishing. So this is Pip Brooke and her brother Giles were just stellar. you know, for the Vita Coco brand in the earliest days. She was a marketing person for Giles and for us at Team Vita Coco. And so I would definitely always try to support them.
[00:43:14] Ray Latif: That almost sounded a little Spaceballs-ish, you know, my sisters, brothers, cousins. Luke, I am your honey. This one looks interesting too. Okay. So this is Seattle. This is a Seattle based brand. Why am I picking the ones that are not British?
[00:43:31] Ken Sadowsky: That's fine though. I haven't tried that one yet actually. Okay.
[00:43:34] Ray Latif: So this is a Tetra Pak packaged product that's called, described as a super boost oat latte. And the name of the brand, I believe, is Wondergrounds Brain Wash has an octopus as the icon underneath the logo. The functional benefit is listed underneath the product type. It's described as focused in energy. It's made with lion's mane, cordyceps, reishi, and chaga.
[00:44:02] Ken Sadowsky: Shake that first.
[00:44:03] Ray Latif: Yeah, for sure. 90 milligrams of caffeine. It's in an 11 ounce Tetra Pak.
[00:44:11] Ken Sadowsky: Yeah, this one was introduced to me originally from Chris Jordan, who learned to brew coffee from Alfred Peet. So he's got pedigree. And then Brian Lovejoy, who's another, you know, he was a coffee sharpshooter for Calafia. And then they're both advisors to Jody Hall, who is the founder of this brand. And I did a call with them yesterday, but I had to admit I still hadn't tried the RTD. Now they do have... Let's see if I have this in my pocket. I'm not sure if I brought it, but they have sticks. I do have it. So they have these and I've been again, I've been carrying this around and I haven't added it. I have 29 more of those, so you may have that one.
[00:44:56] Ray Latif: OK, thank you. This is a Mushroom Superboost. It's a powder packets, 5 grams, anything like just just like you would normally see in these types of little powder packets. The RTD itself is fantastic. Really like this. It's less viscous than you might expect from a latte. But I like it a lot.
[00:45:14] Ken Sadowsky: She's a former Starbucks employee, did 11 years under Howard Schultz in the early days. And she has gotten one of the Starbucks formulators, the one who did both Via and Frappuccino originally. So again, there's some serious credibility there. And then I spoke to her over a year ago, and then my call with her yesterday was because of Mark Skorheim, who is, we call him Marky Mark, and he was the I mean, doesn't take no for an answer sales guy that got Calafia barista blends in all the third or fourth wave coffee shops on the West Coast. He's a San Fran native, and that's where everybody that's in the best coffee shops in San Francisco knows Marky Mark. And so Marky Mark has just come over to this brand and anything that he's involved with, I will at least give an ear to.
[00:46:12] Ray Latif: Interesting well, I guess I won't be surprised if I start to see this in my local natural retail chains I don't want to keep you here all day, Cam. I could stay here all day. We've been talking for almost an hour, it's flown by. Loom, you brought these as well. These are two plastic bottled products, 12 ounces per plastic bottle. L-O-O-M is the name of the brand. We have one variety that's called Moon Punch, another that's called Cosmic Candy Grape. Underneath the flavor names, it actually tells you what it is. It's a juice-infused The Beverage. Cosmic Candy Grape, let's give this a whirl.
[00:46:49] Ken Sadowsky: And this is another one that, you know, it's brand new. And all I can tell you is I'm rooting for it because the founder or one of the co-founders, I think the founder is a NIDA member, Billy Butcher-Movitz. And, uh, nice young man, smart man in The Beverage space. And he's also got one of Carol Dollard's sons working with him. And Carol was the one that formulated all of the vitamin water flavors. And, uh, she is a master of this field. And that's why I say, like, I'm not a formulator, but I have people, I got a guy. In this case, it's obviously a girl or a woman.
[00:47:30] Ray Latif: To be clear, this is not a British brand either. This is based... New Jersey. Yeah, this company is based in New Jersey.
[00:47:36] Ken Sadowsky: Look, whether it's shameless self-promotion or just shameless promotion, this one is, I want to help my friend from NIDA out.
[00:47:45] Ray Latif: So, if I'm being totally honest, I love the flavor. The aroma is not my favorite. The aroma smells a little medicine-y, but the taste is fantastic.
[00:48:02] Ken Sadowsky: Yeah. Well, and I mean, I guess what, what I would say to that is this is a first run. They are ready for prime time. The other thing is you don't get much nose if you're drinking out of the vessel itself.
[00:48:13] Ray Latif: Ah, good point. We're drinking out of large cups here. So you want to try the moon punch? Of course I do. I love fruit punch. Everyone knows this, who listens to Taste Radio. I'm a fruit punch fiend. I assume that's what we're going to get here is some sort of fruit punch flavor. More like a tropical punch. Yeah, this one, this one's really solid.
[00:48:33] Ken Sadowsky: No nose issue to me on this one. Not on this one.
[00:48:35] Ray Latif: Yeah, this one's really good. Really, really good.
[00:48:39] Ken Sadowsky: Well done.
[00:48:40] Ray Latif: Well done, Loom, indeed. You had a shot, you had The Turmeric shot there too.
[00:48:45] Ken Sadowsky: This is a guy named Thomas. He's a former pro football, AKA soccer player from London.
[00:48:52] Ray Latif: My mind immediately went to pro wrestling when you said pro. Okay, so this. is, where is this from? London. Okay. Handmade in the UK. It is a, I believe this is a two ounce shot, 60 milliliters. I think that's two ounces. The Turmeric Co. I like that. Yep. And the ingredients are watermelon. Would not have expected that. Organic turmeric, pineapple, lemon, vitamin C, flax oil, and black pepper. No sweeteners, artificial sweeteners, or Water. No water in this, interesting. Okay, let's try it. 35 milligrams of, no, 35 grams.
[00:49:32] Ken Sadowsky: Is that right? Yeah. 35 grams? It's crazy. This is really a functional product and you may have the entire thing if you want. I'm a fan, no, no, I'm a fan. I'm drinking one a day. I came home with like almost 80 of them in my suitcase. Okay, thank you. It's good stuff and he's looking for investment. And I haven't pulled the trigger yet on an investment, but this is good liquid. I really do like it.
[00:50:02] Ray Latif: I love shots. I love juice shots. I The Turmeric shots in particular. Fantastic. It's really good. Yeah, this is really good. The bottle type is a Little Saints wider than the slim ones that you typically see in store. It'll give it more visibility if you can actually get it into the stores. But that said, it's always been kind of weird because the question about shots is, well, how do you merchandise them? Where do you merchandise them in store? And Whole Foods, there's two places there where I've seen is sometimes with juices, sometimes with Fresh cut fruit and guacamole and things like that. And then most often you see them in the, what's it called? The living section of the store. What's it called? In Whole Foods?
[00:50:41] Ken Sadowsky: Yeah.
[00:50:42] Ray Latif: Oh yeah. It's in Whole Body. Whole Body. Yes. The Whole Body section of the store. But this is fantastic. I would love to see them. And it's pretty, pretty straightforward. The Turmeric Company.
[00:50:52] Ken Sadowsky: So you know what this is. And just to peel back one layer of the onion that might be too much for non-industry observers, but what you're articulating when you talk about where you see it in the store has to do with the category manager that's buying that product. And then the fact that if a product sells well, category or the product, it might not be in the brand's best interest to remain in that spot, but that category manager doesn't want to give up the revenue. It's like, hey, that's the best turning space I've got in my section. That's a fascinating game that gets to the next level for these entrepreneurs. Like, how do we show that we're thankful to the people that gave us a start, but we really have to grow up now and go to the big leagues and get to a different part of the store.
[00:51:40] Ray Latif: So you articulated that. You said I was articulating that. I was rambling about that, but I appreciate the fact that you articulated that. I want to talk about one brand that you recently aligned with, that's Icelandic Glacial, which is a brand that's been around for at least a couple of decades, hasn't it? Yes. You know, I understand it. And Reza Mirza, who has been a longtime beverage veteran, is a great guy, spoke at BevNET Live summer 2024. But your interest in a bottled water company, I didn't see it coming.
[00:52:11] Ken Sadowsky: Well, I mean, it's a huge category, right? Sure. And I think it's a huge opportunity globally. And I was really fascinated by the entire setup, meaning I've known Christian Olofsson for a while. Who's the founder of the company. Yeah. And lives in Miami. And that's, it's good to be able to get together with him just, you know, to talk about the industry without the entire board listening and watching. But it's also, I've been coaching Reza for about a decade and they had, this brand had no funding. Now they've got funding. And so it was really Reza that put my name up for consideration to the board. And I was happily accepting of the board seat because, you know, Reza was like, you've been doing this for 10 years anyway, now you can do it at the board level and actually get paid for it because we're funded.
[00:53:06] Ray Latif: Being funded makes a big difference and having access to capital to help you and your brand scale is critical. And I think that's kind of the weird catch 22 about working with investors. They're like, yes, you know, we want to be involved or advisors, whether they're on the board or otherwise is yes, we want to be involved, but I think they're more inclined to be involved if you have a foundation that is funded appropriately. Again, that being kind of a catch-22, I mean, when you are looking at or evaluating a brand that doesn't have any money, that's a great brand, great leadership, but for some reason they can't raise capital. Is that a red flag for you?
[00:53:49] Ken Sadowsky: It's certainly an amber flag or light. It's not necessarily a red flag because I've been really fortunate in my career so far, and I like rooting for the underdogs and I like helping out the people when and where I can. I do a lot of sort of pro bono, you know, consulting or time with brands. Some of it under the auspices of kicking the tires for something that Verlin Vest may want at some point to invest in, but some of it just because When I was at the bottom end of this journey or category or where I was in my career, there were veterans of the space that were generous with their time that helped me get to whatever level I'm at now, which, you know, is arguable is not too much further up the rungs of the ladder. But anyway, I feel like I've been fortunate. So I feel like it's incumbent upon me to give back. But then I guess just to sort of reel this in and tie it back, you know, what I do is I sort of say in my head, I have X amount of investments and I'm going to make a certain amount of time for either I'm going to give them cash and then free time so that I can hopefully coach them into success. but I also know that I can't have more than one or two of those at the same time. So if a proverbial ankle biter were to come to me today, I have zero bandwidth. You know, now that could change. One of the companies that I'm involved with could go out of business and then, you know, I'm not helping them, but they're not taking up any time either. And then I guess the parenthetical answer to your question is when people say to me, I'm a sheer startup, but we need your expertise. I say, well, look, here's my day rate for consulting. And I would tell you, I'm not the best use of your money. So just, you know, get out of this sort of stage that you're in now or phase that you're in now. And if you succeed now, then we have something to talk about. Sorry for the long answer.
[00:55:57] Ray Latif: No, it's a great answer. And I think people who are listening appreciate that answer because it's straightforward. And one of the things I've always appreciated about you, Ken, is that Yes, you are careful about your answers, but they're straightforward answers. I think you're not holding back on how you feel about a category or how you see, you know, founders succeed or what makes a brand work. And that's why I was really happy that we could have this opportunity to sit down today. Once again, thank you so much for being on Taste Radio. And we're going to do this again, obviously, as soon as we can.
[00:56:33] Ken Sadowsky: Yes. Well, thank you for having me. It's always an honor and a pleasure to be here. Thank you. No, thank you.
[00:56:42] Ray Latif: That brings us to the end of this episode of Taste Radio. Thank you so much for listening. Taste Radio is a production of BevNET.com, Incorporated. Our audio engineer for Taste Radio is Joe Cracci. Our technical director is Joshua Pratt, and our video editor is Ryan Galang. Our social marketing manager is Amanda Smerlinski, and our designer is Amanda Huang. Just a reminder, if you like what you hear on Taste Radio, please share the podcast with friends and colleagues. And of course, we would love it if you could review us on the Apple Podcasts app or your listening platform of choice. Check us out on Instagram. Our handle is bevnettasteradio. As always, for questions, comments, ideas for future podcasts, please send us an email to ask at Taste Radio. On behalf of the entire Taste Radio team, thank you for listening, and we'll talk to you next time.
[00:57:32] The Beverage: you
