Episode 21

Taste Radio Insider Ep. 21: This is Why Nestlé Invested a Half-Billion in Blue Bottle Coffee

February 15, 2019

After spending $500 million to acquire a majority stake in Blue Bottle Coffee, it might be surprising to hear that Nestlé is content to let the premium roaster and retailer “just be.” Blue Bottle CEO Bryan Meehan spoke about the company’s relationship with Nestlé, its purposeful innovation strategy and efforts to enhance consumers’ experience with coffee. Also in this episode: an interview with former N’Sync star Lance Bass, who recently launched a cocktail mixer brand.

Blue Bottle Coffee CEO Bryan Meehan is well aware of the increasingly competitive landscape for coffee. Yet while some companies are racing to expand and innovate, Blue Bottle, one of the most admired coffee roasters and retailers in the world, is taking a patient and restrained approach. “Our way is not the right way if we want to be the most commercially successful company in the country. Meehan said in an interview included in this episode. “There are companies ahead of us that are doing more innovation. But I think our way is the right way if we think about the long-term value of the brand and what taste we deliver to our customers.” That perspective is embraced by Blue Bottle’s majority owner, Nestlé, which in September 2017 paid approximately $500 million for a 68 percent stake in the company. Meehan remarked that Nestlé views Blue Bottle as “doing something very unique and should not be touched.” “Throughout the whole culture of Nestlé, there’s support to just (let) Blue Bottle be,” he said. As part of our conversation, we spoke with Meehan about how Blue Bottle’s new line of whole bean coffee in pressure-sealed cans fits into its purposeful innovation strategy. He also discussed the evolution of Blue Bottle’s cafe and beverage business and the company’s efforts to enhance consumers’ experience with coffee and his perspective on the future of packaged coffee drinks and the industry as a whole. Also in this episode: an interview with former N’Sync star Lance Bass who recently introduced a line of cocktail mixers called Just Add X. Bass spoke about the launch and development of the new brand and how his experience in the CPG business compares to that of his music career.

In this Episode

	1:39: Cannabis, Canned Cocktails & Freeze-Dried Ice Cream -- Mike spoke about his visit to the Seed to Sale cannabis conference held this week in Boston and what it was like to interview Lance Bass. Later, the hosts imbibed on canned cocktails and tea-infused beer, munched on freeze-dried iced cream and remarked a recent visit to the office by Dan & Genevieve Brazelton, the founders of cocktail mixer company Improper Goods. They also discussed the construction of a new studio for our new weekly video show, Taste Radio Now.
	15:23: Interview: Bryan Meehan, CEO, Blue Bottle Coffee -- Since Meehan took the helm of Blue Bottle in 2012, Meehan has overseen three major funding rounds and executed a significant expansion of the company’s cafe business and its foray into ready-to-drink beverages. He also guided Blue Bottle through Nestle’s acquisition of a majority stake in the company. In an interview recorded at Blue Bottle’s booth at the 2019 Winter Fancy Food Show, he discussed the recent launch of its innovative cans of coffee beans and expansion of its cafe business. He also explained why Nestlé views Blue Bottle as “precious” and why “over time (it) can be a company for everybody.”
	30:55: Interview: Lance Bass, Founder, Just Add X -- If you grew up in the late 1990’s or early 2000’s you’re probably familiar with Lance Bass, best known from the wildly popular boy band N’Sync. Since hanging up his headset mic and dancing shoes, Lance has begun a new career as a beverage entrepreneur with the launch of cocktail mixer line Just Add X. At the 2019 Winter Fancy Food Show, Lance sat down with Mike Schneider and NOSH editor Carol Ortenberg for a conversation about the launch and development of Just Add X and how his experience in the CPG business compares to that of his music career.

Also Mentioned

MedMen, Cocktail Squad, Shipyard Brewing Co., Tiesta Tea, Owl’s Brew, Cosmik Ice Cream, RAFT, The Bitter Housewife, Smashmallow, Blue Bottle Coffee, Intelligentsia Coffee, Stumptown, Just Add X, Chef’d

Note: Transcripts are automatically generated and may contain inaccuracies and spelling errors.

[00:00:05] Carol Ortenberg: Hey Landis, how many times have you heard a brand tell you that they're ready to meet investors or looking for retailers or wanting to tell the industry about a new product launch? Maybe like four times today and it's only 11 o'clock. BevNET and Nosh provide multi-channel advertising capabilities to build that kind of awareness and to generate quality leads that drive the bottom line. Our team is ready to help experienced and new marketers drive awareness around important milestones like product launches, fundraising, seasonal releases, and trade show appearances. We can help you build a plan that will drive awareness of your brand, open doors, and generate high-quality, business-oriented conversations. You know, the ones you're ready to have, like today. To learn more, visit mediakit.BevNET.com, or if you're ready to talk, reach out to sales at BevNET.com and send us like 200 words explaining what you're trying to achieve, and we'll be in touch quickly. And now, Taste Radio Insider.

[00:01:03] Ray Latif: Hey everyone, I'm Ray Latif and you're listening to episode 21 of Taste Radio Insider. I'm here at the BevNET headquarters in Watertown, Mass. And with me are my BevNET colleagues, John Craven, Mike Schneider, and Jon Landis. In this episode, we discuss coffee innovation and category trends with Bryan Meehan, the CEO of a revered coffee company, Blue Bottle. We also sit down with Lance Bass of NSYNC fame, who's behind a new brand of cocktail mixers called Just Add X. Just Add reminder to our listeners, if you like what you hear on Taste Radio Insider, please share the podcast with friends and colleagues. And of course, we'd love it if you could rate us on iTunes. Mike, you look relaxed. Thanks. Was it because of the conference you may have gone to yesterday or expo as it were? Maybe, maybe the samples. Maybe the samples. Mike attended an expo here in Boston about the cannabis industries called Sea to Sail. How was it?

[00:01:57] Carol Ortenberg: It was a pretty good conference. It wasn't the entire Heinz Convention Center. It was a medium-sized trade show with main stage and got to hear from Adam Biernan from MedMen. That was a pretty interesting interview. He was talking about mainstreaming cannabis.

[00:02:13] Ray Latif: So what was it? Was it sort of a trade show and a conference? Was it an educational event?

[00:02:17] Carol Ortenberg: I think it was primarily a trade show with a little bit of education and a little bit of main stage stuff. Like they definitely had times that, you know, they wanted you to be doing the stage content and times they wanted you to be in the trade show. So there was a little bit of content, enough content to be interesting, but not too much that they covered, you know, the entire industry, but I thought it was good.

[00:02:38] Ray Latif: Now cannabis is legal here in the state of Massachusetts, excuse me, the Commonwealth of Massachusetts. Yes. So were they giving samples of THC laden products?

[00:02:48] Carol Ortenberg: So officially nobody was giving samples and nobody was allowed to give samples. I mean, I saw some things going on, you know, there were definitely some people partaking of vapens and things of that nature, but I don't know exactly what was in those pens, but yeah. Yeah, you know, you could.

[00:03:03] Ray Latif: Did someone offer you a hit and you turned it down?

[00:03:05] Carol Ortenberg: I did get myself some samples of CBD. I'm not, I mean, nobody offered me THC, but I would not have turned it down. I love how you did that.

[00:03:13] Bryan Meehan: I did, I did, I did.

[00:03:16] Carol Ortenberg: Someone Just Add you a Jeffrey. Nice. Well done. I stroked the furry wall.

[00:03:22] Ray Latif: Excellent references all around. Now, Jon Landis, prior to us jumping on the mics, you brought up a very good story about the evolution of the CBD beverage category that our editorial assistant Aaron Cabray wrote about on BevNET.com. Is CBD a beverage category?

[00:03:40] Carol Ortenberg: I mean, it's kind of early to say, but there were some really interesting brands that I'm kind of ashamed to say that I discovered in this article.

[00:03:49] Ray Latif: So, you know, I definitely... You shouldn't be ashamed. It's BedMed. That's where everyone learns about new beverages, right? Now, Mike, that wasn't your only highlight of the past month. You interviewed a celebrity who's featured on this episode of Taste Radio Insider. That person is Lance Bass. I'm curious, what was it like to interview the guy?

[00:04:12] Carol Ortenberg: I mean, Lance Bass is, he's a fun guy. He's actually pretty down to earth. And he seems to be the kind of guy who, you know, he has a creative idea and he likes to operate. He had gained a lot of knowledge about the beverage industry and how he's going to launch the beverage. And it was really enjoyable to talk to him.

[00:04:29] Ray Latif: I mean, I, I assume so. He's fun. Was he, was he willing to talk about, you know, the past and stuff? I'm sure like you'd have a million questions be like, what was it like to do this and do that? Or was he kind of like, Hey, I don't want to talk about that anymore.

[00:04:40] Carol Ortenberg: I mean, it had been a while since I'd seen him, you know, since we'd been out, you know, hanging out. Did he break out into song? Yeah, every five seconds. We had to edit that out though. He did make some cocktails. I did not partake in the interview, but I showed up and yeah, I got to try his cocktail mixer. And it was interesting to see him working a cocktail shaker. He's ready to demo. Like he wants to demo the product. He's really excited about it. And that was fun to see too. You know, I mean, it was crazy to see a guy that you kind of grew up- Idolizing? Admiring and idolizing. There you go. On your wall? Yeah, I had posters up. I got his autograph, but it wasn't for myself. Ah, well done.

[00:05:21] Ray Latif: I see so many products here on the podcast table. And these are all new products that came into the office over the past week, some within the past month. John Craven, you brought some products Canned Cocktail Squad. What are these?

[00:05:35] Carol Ortenberg: These are ready to drink cocktails. Yeah, I brought these. It seems like these sessions are always better when there's some booze. For the listeners at home as well. Yeah, these guys, you know, I really like the packaging of this. I don't know how you sort of describe it, I guess, but they've got a let's see, a margarita, a Greyhound, a gin and tonic and a vodka soda. Some are better than others, but we'll include a photo of the packaging in the show notes. 10% alcohol on these things. They're definitely taking advantage of it being an alcohol product by not listing the nutrition facts and ingredient panel. But I think it might be a missed opportunity to, you know, call out low calorie count, especially on stuff like vodka soda.

[00:06:25] Ray Latif: You know, I have a feeling that people are going to be buying that because, you know, it has, well, is this a British product? Oh, no, it says a home bar in Boulder, Colorado. It looks British.

[00:06:36] Carol Ortenberg: Yeah, it does have an English style to it. But yes, it's a US product. They do have the ingredients on the front of the can. Not sure if that's a full list or not. But This is a pretty remarkable package. I think there's a, I mean, first of all, the way to describe it is this is Chevron. And there's like some strange Chevron stripes on here. Chevron the gas, the gasoline company? Yeah, the gasoline.

[00:06:58] Blue Bottle: You got it.

[00:06:58] Carol Ortenberg: There's gasoline in it. No, there is no gasoline in it. It's like abstract Chevrons. Yeah, it's abstract Chevrons with like this interesting gold and one other color motif. But my favorite part is definitely this, I think it's like a wolf standing or a wolf standing on a cow or a bear. No, it's definitely a bear. It's definitely a wolf standing on top of a bear. I don't know, or a unicorn or something, I don't know. That's what happens when you drink about five of these, you start seeing that. Oh, no, yeah, definitely, it's a wolf on a bear, and if you drink it, it turns into a unicorn. It does. Interesting. I like the, I mean, the gin and tonic, I don't know, it's simple, like, it's pretty solid. That's probably my favorite. The wolf jumped down on the side, look, check it out. Yeah. It's amazing.

[00:07:41] Ray Latif: Yeah, and we've got more booze on the table here. This is a brand called Tea Brew, which is a collaboration between Shipyard and Tiesta Tea. You might remember Tiesta Tea from episode 19 of Taste Radio Insider, when we did an interview with Patrick Tanous, the president and co-founder of the company. It describes itself as beer infused with herbal tea and yerba mate. Well, this is the Maui mango variety. Let's take a whirl here. Anybody?

[00:08:08] Carol Ortenberg: The beer world loves a collaboration.

[00:08:10] Ray Latif: Yeah, well, I mean, we saw this with the Owls Brew folks. They launched a boozy tea product, and I'm seeing a few more of these come to market. They used to call it a Radler. Yes, they used to call it a Radler, and they dropped that name, and now they're calling it a boozy tea. Boozy tea. Yeah, this is a pretty tasty product. I was expecting a lot more. sweetness to it, but it's beer with like that good hint of tea.

[00:08:37] Carol Ortenberg: I gotta go to a driver's ed class for my kid tonight, so I should definitely show up plowed. Let me try this.

[00:08:42] Ray Latif: Plowed, he said, plowed. He didn't say tipsy, he said plowed. I'm kidding, I'm kidding.

[00:08:46] Carol Ortenberg: The next booze that we're sampling on this episode is Moonshine from Ray's uncle's basement. I love Ray's uncle's basement. That's my favorite.

[00:08:54] Ray Latif: Jeez, this is going downhill fast.

[00:08:56] Carol Ortenberg: Spend a lot of time there, huh? Good shine, bro. He thought he was at a cannabis conference, but it was just Ray's uncle's basement.

[00:09:05] Ray Latif: Now, while folks sent these to our office, we actually had a great visit from Dan Dan Genevieve Brazelton, who are the founders of Improper Goods, the parent company of raft syrups and The Bitter Housewife, which Canned Cocktails mixer products. Great to see those folks coming in from Portland, Oregon, or in the Portland, Oregon area, all the way over here to the Boston area. I always like a nice cocktail break.

[00:09:27] Carol Ortenberg: I know. I'm kicking myself here because they left behind a nice bottle of bourbon, and we have plenty of raft bitters and some syrups. What can we do with those? We could be drinking those is what we could do. They could be on the table. Yeah. Yeah. I mean, they have both the raft line and The Bitter housewife line, really phenomenal quality products. Love the packaging on both those. So it's great to have them by the office, be able to share a Cocktail Squad 4 o'clock in the afternoon. you know, I guess have some visitors at our bar here, so.

[00:09:59] Ray Latif: At the new bar. Absolutely. Yeah. Well, that's a good segue to if you are in the Boston area, think about coming to the Boston area. Please drop by for a visit. We're at 44 Pleasant Street in Watertown, suite 110. It's not too hard to find us. Speaking of visitors, we did have another one here at BevNET headquarters, and that's Robert Colonel. I hope I'm pronouncing his name correctly. He's the founder of Cosmic, which is a brand of Freeze-Dried Ice bars, like the one I'm holding in my hand here. This was a huge- AKA Spaceman ice cream. Exactly. It's a huge, huge hit in the office. They're literally freeze-dried.

[00:10:34] Carol Ortenberg: uh, ice creams and it's very reminiscent of the astronaut ice cream that you would get at the Smithsonian in DC and except it's, you know, a lot more wholesome from an ingredient perspective.

[00:10:46] Ray Latif: I can't imagine what was in those things when they took us on field trips back in the day. This one, you can definitely pronounce everything that's in here.

[00:10:53] Carol Ortenberg: but he's having, as you can imagine, difficulty scaling, Freeze-Dried Ice cream for now he's doing it himself and trying to figure out how he can make the jump into co-packing. But it's a really, really pretty packaging. Yeah. Beautiful packaging. Mike Schneider. What do you think of this packaging? I dig the packaging. I like the pastels. I like the simplicity. I like his use of white space. It has a smashmallow look and feel to it. If you've seen the smashmallow packaging, this is like, if smashmallow was one color and had, you know, just better use of white space, I suppose, but I like the smashmallow packaging too.

[00:11:31] Ray Latif: Our events director, Ashley Harding, came into the kitchen when we were sampling these, I asked her straight up, I'm like, you wouldn't eat this as a dessert, would you? And she said, yeah, I'd eat this after dinner. And me Jon Landis were like, This is a little bit more of a snackable kind of thing for us.

[00:11:44] Carol Ortenberg: I'd eat it either time myself. I mean, I could see it as a substitute for ice cream. It's like snacking ice cream. It's like snacking butter and drinking chocolate. I mean, snacking chocolate worked out pretty well.

[00:11:57] Ray Latif: I think so. But the way Robert's positioning it now is sort of as a, thing to take with you if you're going on hikes or if you're going camping or something like that, something that's clearly not perishable unless you open it, at which point he said it does start to deteriorate a little bit.

[00:12:11] Carol Ortenberg: That seems massively flawed because if I bought this with the intention of taking it on a hike, I'd just freaking eat it on the ride home.

[00:12:20] Ray Latif: Now, amidst us drinking and talking Freeze-Dried Ice cream Canned Cocktails mixers, we're actually moving our podcast studio and building out a new studio for Taste Radio Now, which is our weekly video show that's presented live on YouTube and Instagram every Thursday at 4 p.m. Eastern time. As I mentioned, we're in a different room now, and it's tighter in here.

[00:12:40] Carol Ortenberg: We downsized. We're getting old. We had to downsize.

[00:12:45] Ray Latif: We knew we'd just get a smaller fridge, you know, less closet space, all that stuff.

[00:12:50] Carol Ortenberg: It's better, it suits us better. And the old room being used for a video studio, which needs a little more room than our little podcast setup. Stern's gonna have to move his desk, because this window is like, he's sitting at his desk looking right in here at us.

[00:13:02] Ray Latif: That's Adam Stern, a senior account specialist.

[00:13:04] Carol Ortenberg: You know, we have these windows between some of the offices, like just literally, you know, they were remnant windows from like Lowe's or Home Depot. You know, it seemed like a great idea at the time, but we're slowly just ripping them all out, so. Yeah, I jammed my fingers in them the other day. You can't even open a window? I mean, there's some sort of joke there.

[00:13:23] Bryan Meehan: You jammed your finger?

[00:13:24] Carol Ortenberg: Yeah, you're our sales guy. So, you know, it's cool. Mr. Stern's window?

[00:13:30] Ray Latif: Geez. All right. Well, Adam's going to be coming with us to Expo West. The four of us in this room, along with probably, what is it? Another 16 of us all going to Anaheim. Yeah. We've rented a yellow school bus.

[00:13:42] Carol Ortenberg: We are already gearing. We're already gearing. I would see if Lance Bass can hook us up with the space shuttle.

[00:13:48] Ray Latif: Jesus. As I was trying to say, we're gearing up for Expo West, edit meetings and all. If you have news or exciting info about your brands, email us, news at BevNET.com, news at Nosh.com. And if you might think you'd want to be on Taste Radio, hey, send us an email to ask at Taste Radio and perhaps we'll sit down with you. And the next thing you'll know, you'll be on episode 30 of Taste Radio Insider. What if they want to be on Taste Radio now? Well, they can do that too. Just send us an email to ask at Taste Radio. All right, let's get to our interview with Bryan Meehan, who, as I mentioned at the top of the show, is the CEO of Blue Bottle Coffee. Brian took the helm of the admired roaster and retailer in 2012, and over the past six-plus years, he's shepherded three major funding rounds and overseen a significant expansion of the company's cafe business and foray into ready-to-drink beverages. He also guided Blue Bottle through Nestle's acquisition of a 68% stake in the company. That took place in September 2017 at a valuation north of $700 million. I sat down with Brian at the 2019 Winter Fancy Food Show, where Blue Bottle was introducing a new line of whole bean coffee packaged in pressure-sealed cans. You'll want to hear the cost of acquiring the technology to produce those cans. In our conversation, Brian spoke about Blue Bottle's patient approach to innovation and the evolution of its cafe and beverage business. He also discussed the company's efforts to enhance consumers' experience with coffee, why Nestle views Blue Bottle as, quote, precious, and shared his perspective on the future of packaged coffee drinks and the industry as a whole. All right, it's Ray, and I am at the 2019 Winter Fancy Food Show, and I'm at the Blue Bottle Booth, the very jam-packed Blue Bottle Booth, and sitting in front of me is the CEO of the company, that's Bryan Meehan. Brian, thank you so much for taking the time to be with me. Great pleasure to be here.

[00:15:38] Blue Bottle: How is your fancy Food Show going? It's good. We're getting a lot of interest in our new can of whole bean coffee. So that's new at the show. Indeed it is.

[00:15:47] Ray Latif: It's this most beautiful cylinder. It looks like art, honestly. It's a six ounces of whole bean blend. And it's got this white top that I'm pulling off. And then let's see if I can open this. It's like I should get a pop. It's a can. It's a can. It's almost like you open up. It looks like a 16 ounce can. And let's get the pop.

[00:16:05] Blue Bottle: Whoa. that beautiful sound of the pop.

[00:16:08] Ray Latif: Now I get to smell it. Oh my God, that smells so good.

[00:16:11] Blue Bottle: I mean, I don't know if your listeners know about how we retail beans, but it's very rare to find a bag of Blue Bottle beans outside our cafes because we're very concerned about freshness. We do sell to certain cafes in Northern California, certain Whole Foods markets. But other than that, you'll be in Byride but you'll never find it in major supermarkets across the country. And that's because we're neurotic about freshness. And with this technology that we have, this is a way that we can can coffee rather than put it in a bag. It's very environmentally friendly. Most importantly, it actually keeps the coffee fresh for four to six months. So it's not until you open it and you get that beautiful pop the coffee will then start to begin its proper life. And it has about a two week shelf life from the time you pop it open.

[00:17:01] Ray Latif: So when you cover it, there's a white cap right here, and you cover it, and how tight is that seal?

[00:17:06] Blue Bottle: It's pretty tight. Okay. Yeah. So once you open the can, it's a small can, it's six ounces. It's designed that way to make sure that you don't have it in your larder too long. But once you open that can, it'll be great for two weeks. Right on. Which is what our bags are good for right now, two weeks. But everyone knows, like, you buy that bag of Blue Bottle coffee, you put it in your larder, and then you're away for a weekend, or you're away on holidays, vacation, you come back and you're like, oh, I meant to drink that Blue Bottle of coffee, or you're out of stock. Now, you can just have these cans in your larder and you can pop it anytime you want.

[00:17:38] Ray Latif: I'm going to bring one home. I'm going to bring one to BevNET headquarters. We're pretty fanatical about our coffee, so I can't wait to grind some of this back when we go get back to Watertown.

[00:17:46] Blue Bottle: I mean, our commitment to everyone is that this coffee tastes as good as it tastes in our cafes. Right on. From the moment you pop it.

[00:17:53] Ray Latif: You know, that's at the heart of everything that Blue Bottle does. I mean, you're fanatical about quality and you're also, you take your time with innovation. Yes. The innovation that you've come out with on the RTD end has been very slow and steady and patient. While, you know, we've seen a lot of RTD trends just go fast and furious, obviously, you know, cold brew and the interest in companies innovating in that space. Why the patient approach?

[00:18:20] Blue Bottle: I just think that fast and furious are not two words that describe Blue Bottle. And so even though we were pretty quick to bring our New Orleans to the market, I think it was probably 2013, 2012, you know, we had spent a lot of time trying to perfect that product in the familiar milk carton. And then we brought out the can of cold brew, which is, you know, the whole emphasis of both of those products is they should taste as good as they taste in our cafes. And then, you know, there are opportunities to do a New Orleans with almond milk or, you know, to come out with products that have huge shelf lives, which, you know, ambient products and stuff like that. But we've never been satisfied with the tastes. There's obviously a correlation between shelf life and taste, except for those cans. And so we've just never been happy with it. So fast and furious is not something that we believe in. And I'd much rather just have two beautiful products in our ready to drink business than to have you know, a whole host of 25 products that I think may taste average. I want our products to taste delicious and people to be constantly surprised by how beautiful our products are.

[00:19:25] Ray Latif: And you've got a variety of ways that you're selling coffee. You have your cafes, you have your RTD products, you have limited package coffee as well. What has been your area of focus? Where is the most opportunity for growth for a Blue Bottle?

[00:19:38] Blue Bottle: Is it in your cafe business? I think it's always been, I mean, our cafes are 85% of our business. And, you know, we've always been a cafe driven company. From the time that I got involved in 2012, companies like Stumptown, Intelligentsia, had been moving towards the wholesale market and ready-to-drink market with very little emphasis on opening cafes. Blue Bottle at that point was very clear that it was going to continue to open cafes and we not just opened in LA and New York and DC, Boston, places like that, but we also opened in Tokyo and Japan and since that in Kyoto and Kobe. And then in 2019, we'll actually open some cafes in Korea. And last week, we opened a pop-up gift store in Taipei. So yeah, Asia is a big market for us. The cafes are a big market for us. You know, that's probably one thing that's different about us versus other coffee companies.

[00:20:31] Ray Latif: It feels like Blue Bottle is almost a self-contained unit. It's an independently run company within the conglomerate that is Nestle. How much leeway, how much opportunity do you have to sort of call the shots?

[00:20:44] Blue Bottle: I have complete control as not Just Add CEO, but as a major shareholder in the company when we did the deal with Nestle. They have been a blessing for us in terms of supplying us with capital and advice. But there's a sort of amazing support from Mike Schneider, the CEO of Nestle, that Blue Bottle doing something very unique and should not be touched. And throughout the whole company of Nestle, there's this cultural support Blue Bottle to just leave Blue Bottle and trust in Brian and James and the team in Oakland to do what they need to do. And if they need help, please help them. But if they don't need help, please leave them alone. And that's been a blessing for us. Because I've been through two acquisitions before in my lifetime. You know, I sold an organic food company to Whole Foods, and I did something else in skincare. So I know how things can happen when you sell a business. And I know that every listener is concerned that Blue Bottle may change, that now they're majority owned by Nestle. But one of the things for me is like, I've been through two acquisitions as a CEO. So I know the mistakes that CEOs make. Blue Bottle is such a special brand that I was never going to allow that to happen with Nestle. And Nestle are actually a very special company. They have no intention of doing anything that would damage the brand Blue Bottle.

[00:21:59] Ray Latif: Yeah, I mean, it seems like Nestle is looking to Blue Bottle to continue its leadership position as an innovator, as a, I think one of your colleagues used the word, precious coffee company that can carve out new territory for the coffee industry. So what are some of the ways that you're looking to enhance that coffee experience for consumers?

[00:22:22] Blue Bottle: We talk about in Blue Bottle just not staying the same. We talk about getting better. So whether it's, if you're using our coffee at home, this new can, which is unusual, looks different. It's not what, when you walk down the aisle of Whole Foods, you see this can, it just looks... luminous on the shelf, but it's not what you're used to seeing. And it only has six ounces, so a lot of people won't like that. But when people realize that it can be in their larder for three months, and then you open it, and it tastes as good as you went into a Blue Bottle cafe, that's actually a pretty amazing innovation for us, and that's something that we spent $20 million on as a company before Nestle. It's like one of the biggest acquisitions that we did was acquiring this technology. We use a very special technology in doing this, canned whole bean, and we had to spend a lot of money, and at the time, I'd sleepless nights about was that the right thing to do. So that's an amazing innovation. We're really excited to come out with new products. I think we're gonna be the first in the coffee industry to actually be able to describe cold brew in the way that wines do by taste. There's not many companies that are actually, when you have a, there's a lot of cold brew on the shelf in Whole Foods, but they talk about vanilla or different flavors, Next month, we're coming out with a bright and a bold version of our cold brew for people who want the more luminosity versus the people who want more of the fudgy substantial taste of a heavier brew. So that's why we've come out with bright and bold. And I think that's a first. And then in our cafes, you're going to see just continual innovation around hospitality and deliciousness and coffee, pairing with the things that we do in food. We have our own kitchens and our own food team at Blue Bottle. So we opened two cafes last week and we opened a gift store in Taiwan. It's that kind of focus that we're doing. Things that we can control, I think what Blue Bottle comes down to, we need to control the experience the customer has, whether it's in our cafe or in a whole food store. And once we know we can control it and it tastes delicious, we'll do it. And if we can't, we won't.

[00:24:24] Ray Latif: It sounds like a pretty similar approach to an intelligentsia, and I spoke with the CEO, James McLaughlin, about this very same thing, which is that everything matters. Every detail is important. But it also seems like it's a little limiting because you can only reach so many people when you do worry about every single detail. Do you see a point at which Blue Bottle can be for everyone, or is it really Just Add super premium brand for a super premium consumer?

[00:24:50] Blue Bottle: I mean, one of our values is hospitality. So it's like everyone is welcome. We welcome everybody. So I would never want to be an exclusive coffee for anybody. And I think when you go into our cafe and you pay $4 for a drip coffee, that's hand poured. And the coffee is somewhere between day three and day 10. Yeah, there are a lot of people in America can't afford to spend $4 on an organic coffee. I get that. But I don't think that we're trying to do something that's very privileged or very exclusive. So I think over time, Blue Bottle can be a company that I know is for everybody. We don't like to assume that, but we certainly don't want to be an exclusive premium coffee company.

[00:25:32] Ray Latif: When it comes to some of your RTD offerings, you mentioned the canned cold brew, which is this 8-ounce sort of squat can.

[00:25:38] Blue Bottle: And then you've got, how would you describe this? This is the New Orleans iced coffee, which is one of our most popular iced drinks in the cafes.

[00:25:45] Ray Latif: And the package, though, is reminiscent of an old milk carton maybe you'd have at school. Yes. You know, what do you see as the opportunity in RTD? Is it in shots? Is it in new packages? I mean, is it in more milk formats like a Snorlin style coffee?

[00:26:01] Blue Bottle: I would say like you mentioned before, like we're not fast and furious and, you know, blue balls a little bit slow. And I would say there is just like an overwhelming amount of innovation in this category and it is growing like crazy. But I don't think there's a lot of emphasis on Taste Radio deliciousness. When we talk about having to focus on a lot of different things in business, I think for a coffee company like Blue Bottle, there are certain things that are more important than others. And I think taste is critical. And I would be a little bit critical of the industry itself that I think taste has been an afterthought in some of these products. And shelf life has been more of a forethought in terms of Retailers are demanding long shelf life, so then the result is to change the way you make the product to make it last longer. And then as a result, it doesn't taste as good. So with Blue Bottle's always been the taste is what matters first. And if we can't get the shelf life with it, then that's fine. We won't supply certain retailers who want 12 months of shelf life. We'll supply the retailers who are happy to work with 90 days of shelf life.

[00:27:00] Ray Latif: Do you feel a responsibility when you are putting out a product like a cold brew to be a cold brew coffee? I mean, I think that's one of the things that has certainly not been consistent and there's no consensus on what cold brew seems to mean among producers. I mean, how long do you cold brew your coffee for this product?

[00:27:17] Blue Bottle: So in terms of how long we cold brew for, it's approximately 24 hours. The reason that you get the luminosity and taste, though, is that we filter it about three to four times. So it's not pasteurized. It's not heated. Obviously, it's cold brew. But there are a lot of companies out there that are doing heat and then chill. And so what you get is a product that's 100% organic, that just has water and coffee beans in it, that's been steeped for 24 hours, and then filtered in our own facility. We don't use third-party vendors on this. This is something that's Blue Bottle facility. We do it ourselves in Gilman in Berkeley. And so, yeah, that's how we make the product, and it's a pretty delicious product if you compare it to anything on the market right now.

[00:28:00] Ray Latif: Well, that's the thing. I mean, if you're comparing one cold brew to another, Is your way the right way? And if your way is the right way, how do you convince your distributors, your retailers, and ultimately your customers?

[00:28:11] Blue Bottle: Our way is not the right way if we want to be the most commercially successful company in the country. And I think there are companies ahead of us that are doing more innovation. But I think our way is the right way if we think about the long-term value of the brand, which is important to us, and what taste we deliver to our customers. Bottom line is I'd rather have two products that taste delicious than 25 products that, you know, are just slightly average.

[00:28:36] Ray Latif: Brian, this has been great. I'd love to ask you about your thoughts on the future of the coffee category, and particularly within the packaged and RTD space. We see so many new brands coming to market. It's such a crowded category for coffee, both in liquid and in whole bean. How do you think the industry can work together to continue developing the coffee category in a way that is beneficial for all?

[00:29:04] Blue Bottle: I mean, that's a huge question. It does start with growers. And at Blue Bottle, we pay, you know, the average market price for Arabica coffee is about $1.05.

[00:29:15] Ray Latif: We pay... Are you direct trade or fair trade?

[00:29:17] Blue Bottle: Yeah, we buy direct. Okay, it's direct trade. We pay about $3.50. So we're paying about three and a half times what the market pays for Arabica coffee. So I think it starts there. I think it also starts with internal hospitality in companies. I'm sure there's lots of entrepreneurs listening to this. And again, I don't think you can have a successful business or a successful industry if you don't treat your employees with tremendous respect and make sure that they benefit with the growth of the company, both personally and financially. And then within the coffee industry itself, I would just like urge the industry to just pay very close attention to environmental issues, as well as quality issues. And there's, you know, try not to get overexcited by the trend. And, you know, the reason we all started in this business is we like making delicious coffee. And that's where we have to stay rooted. outstanding.

[00:30:06] Ray Latif: Brian, this has really been a great conversation. I really appreciate you taking the time. Thank you so much. Good luck with the rest of the show and good luck with Blue Bottle. Thank you for your interest in Blue Bottle. Thank you so much. All right. Now if you grew up in the late 90s or early 2000s, you're probably familiar with our next guest. That's Lance Bass, best known from the wildly popular boy band NSYNC. Since hanging up his headset mics and dancing shoes, Lance Bass become an entrepreneur and recently introduced his first beverage brand, a line of cocktail mixers called Just Add X. At the 2019 Winter Fancy Food Show, Lance sat down with Mike Schneider and Nosh editor Carol Ortenberg for a conversation about the launch and development of Just Add X and how his experience in the CPG business compares to that of his music career.

[00:30:52] Lance Bass: Hi everyone, Carol Ortenberg, editor of Nosh here, and I'm with Mike Schneider of BevNET and Lance Bass. Lance, thanks so much for joining us. I know, we've been saying this all day. Listen to the bass. Now that's like what I want to say now.

[00:31:10] Just Add: I think I should officially change my name to Lance Bass. Wait, now you're making bass voice on purpose. Yes. You have to talk like this the rest of the interview.

[00:31:19] Lance Bass: It's for the next stage of your career. Tell us what you're doing here at The Bitter Fancy Food Show.

[00:31:24] Just Add: Well, this is my first fancy Food Show, which I'm very excited about.

[00:31:28] Lance Bass: Do you feel fancy now?

[00:31:28] Just Add: I feel very fancy and I'm such a foodie. So going around and stuffing myself with all these amazing samples has been great. But I brought the liquids for everyone to enjoy.

[00:31:38] Blue Bottle: Awesome.

[00:31:38] Just Add: Because you know, a little vodka wouldn't hurt anyone here at this food festival. But I'm coming out with a new mixers line called Just Add X. Jax is what we call it. And it's a mixologist-inspired craft cocktail that's already bottled for you. All you have to do is add the ice and add whatever favorite liquor you like, and you got it. So you can be your own bartender. And we created it because our friend is Jax Taylor on that show, Vanderpump Rules. I was going to say he's a recidivist. Oh, yeah. Oh, yeah. Well, this is how it all came. Me and my friend were joking about how bad of a bartender he was. And we were like, well, maybe we should just invent something for people like him. that it feels like they made a craft cocktail, but you never knew they Just Add liquor. And so that's when we created Just Add X. And yeah, we're super excited about it. They taste phenomenal, which I'll let y'all taste very soon.

[00:32:24] Lance Bass: And they have some pretty fun names too.

[00:32:26] Just Add: Yeah, we're still working on the names. Originally, when we started this company, we were being real cheeky with Jax Taylor because He went through a period of his life where he wasn't, you know, very faithful. You know, he was a little partier. Well, then all of a sudden, in the last year, he's, like, turned a leaf, new leaf. So he's engaged. He's, like, has a, you know, wonderful relationship. So that's why we went with, like, the cheater and the S.O.B. And he's like that, like, really to describe him.

[00:32:52] Lance Bass: But now you have to rethink the name. He's a really good friend.

[00:32:55] Just Add: I'm still gonna go with the cheeky thing just because it's, like, an ode to his past. Yeah, that'd be fun. And our cheater, of course, is the less sugar. So, you know, you can just like achieve that. Yeah.

[00:33:05] Lance Bass: You know, I think those quirky names kind of bring consumers in on the story and make them feel like they're part of the brand and they know The Bitter secrets behind it. I totally agree.

[00:33:16] Carol Ortenberg: And I was thinking maybe you should start a canned seafood line, maybe call it Tin Sync. That would be... Can I steal that? It's all yours.

[00:33:24] Just Add: Dad jokes are happening, guys. They're happening.

[00:33:27] Lance Bass: You've had relationships with food brands before. I know you worked with Chef a little bit on a meal kit. Right. Did you learn any tips and tricks about when you're creating a brand and you have this personality that consumers are already aware of what you should and shouldn't do?

[00:33:42] Just Add: Yeah. Well, it's got to be authentic for sure. You can't just put a celebrity with a product and be like, okay, I'm not going to buy Hentwater from Britney Spears. I don't know what it is, but...

[00:33:51] Lance Bass: I mean, I would buy Hentwater from Britney Spears. That's actually a good idea.

[00:33:54] Just Add: Let's go over to Hentwater and tell them. Carol will love the idea. It's got to be something that you're very passionate about. You know, I love flavors. I come from the South, so we're always wanting the spiciest, the sweetest, the everything. So in creating a drink like this, I just wanted the flavor just to punch you.

[00:34:10] Carol Ortenberg: So it sounds like you're involved in the formulation of the beverage. A lot of celebrities that we meet are more involved in the marketing or something like that. But tell us about your role.

[00:34:19] Just Add: No, this is from day one, I was there. I helped create this with my friend James and it's been fun and it was so new to me. I've never sat in a lab before coming up with flavors. So we took months and we would just go and we would taste all types of different flavors that I never knew existed. There is a Schnozberry out there.

[00:34:39] Lance Bass: Did you have to lick the wallpaper to taste it?

[00:34:41] Just Add: I didn't have to lick the wallpaper. But it's crazy. I didn't know there were 500 versions of Apple. I mean, it's just insane. So getting it to the perfect taste has been challenging and we're still working on it as we go. A lot of people will taste it today and you'll be one of the first to taste it. We'll take your notes and be like, well, I thought this was a little sweeter. I like this one better with gin. Is that how we talk? Learning as we go.

[00:35:06] Lance Bass: Just Add gin.

[00:35:07] Just Add: Just Add gin.

[00:35:08] Lance Bass: That's kind of my slogan for life, basically.

[00:35:13] Carol Ortenberg: So talk to us about the difference between, you know, being in the music business and then also in running a beverage company. This is the biggest challenge you've had yet?

[00:35:20] Just Add: I mean, it is. It's quite well, you know, in a way, it's similar because of the competition. I mean, you walk around a show like this and you can get very discouraged, especially if you're in the sauce business. You're like, everyone has a barbecue sauce. So you can get pretty discouraged and the same thing in music. You know, you come out and then all of a sudden you see all these other bands and you're like, well, crap, how are we going to stand out? So it really is just finding that niche, that marketing that really stands out and gets people to say your name.

[00:35:49] Lance Bass: And at the show, we're sitting in the Keen Growth booth because they are your investor partner in this business. I assume they also kind of played a role in helping you develop it. And that's something we hear from a lot of entrepreneurs is that sometimes it's helpful to have that partner that has the experience in the industry.

[00:36:06] Just Add: 100%. You know, we're kind of on a tight deadline of getting this out because, I mean, usually, you know, it takes people years sometimes to get their product, you know, ready to go. With ours, we have a bit, you know, Vanderpump Rules starts next November on the new season, and every episode is the making of this drink. So if we don't have it out in stores by then, then it's just, we've missed a whole marketing, you know. So that's where we're kind of lined up now. So that's why we wanted to get with someone like a Jerry that has done it. They've proven themselves. People love them. And I know that they can grow this very quickly.

[00:36:39] Carol Ortenberg: On the music side, are you this involved in the business as well on the marketing side? I know you're a creative guy.

[00:36:45] Just Add: Yeah, on the music side, I was always the marketing guy. Every video you saw, I pretty much wrote. I like the visuals. I like, you know, and especially with a boy band, it was amazing to learn a lot about marketing because that was, I mean, it was nuts what we had to deal with. And you could sell anything. I mean, we had

[00:37:02] Lance Bass: You guys were like the original influencers, kind of. That was really the beginning of seeing, like you said, lip balm or, you know, your favorite musician use a product. It was as the internet was kind of getting a hold and things like that. And so you were able to convey your likes and dislikes to consumers faster than ever before.

[00:37:20] Just Add: It's true. And we missed the whole social media, you know, days. I mean, if we had that, it would be so great to easily get into people's faces with different products. But back then, we would make crazy deals with Budweiser and Kraft. It was a huge campaign. You would spend six months to a year on this campaign and do commercials and all that. Now, it's like, oh, we can just launch something on Instagram page and get millions of votes and we did that in a day. Yeah, there you go. Perfect. We didn't have to spend millions of dollars. Awesome.

[00:37:48] Carol Ortenberg: So the label here, the logo's big, the colors pop. Were you thinking about Instagram when you designed the brand?

[00:37:54] Just Add: We did actually. My partner, James Kirtley, he does a lot of brand designing. So he was the one that came up with all of this. And I mean, when people see it, they immediately like, oh my gosh. If I saw that on the shelves in the grocery store, I would go straight to it. And that's what we wanted. We needed something to catch your eye. And one thing about mixers right now, there really aren't any. I mean, you go to a grocery store, you got Bloody Mary Mix, you have Margarita Mix, you have Soda and Tonic, and there's nothing else sitting next to it. So we want this beautiful packaging to be right there for people to love.

[00:38:24] Lance Bass: We look forward to continuing to see you at these shows, and seeing what you bring out next year then.

[00:38:29] Just Add: All right. Oh, we got lots of stuff. Wait till you taste my saucy lips. Can't wait to see TenSync. It's real good. Which I have here. I'll let you taste it. Okay. It's really good sauce.

[00:38:36] Carol Ortenberg: I can't wait till you launch TenSync.

[00:38:39] Just Add: I love it. Thanks, Lance. Thanks. Thank you.

[00:38:43] Ray Latif: That brings us to the end of episode 21 of Taste Radio Insider. Thank you so much for listening, and thanks to our guests, Bryan Meehan and Lance Bass. Please subscribe to Taste Radio Insider on iTunes, Spotify, Stitcher, SoundCloud, or Google Play. 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, thanks for listening, and we'll talk to you next time.