🍵 JENNIE RIPPS // OWL’S BREW CO-FOUNDER & CEO

0:00Jennie Ripps:I'm Sam Rose, and you're tuning in to Commerce is Chaos, the podcast for consumer brand founders who know that building a business is messier than the highlight reel shows. Your supplier just missed their deadline, your top product is out of stock, and your competitors somehow launched the same thing at half the price. Sound familiar? Every week, we dive into the real problems that keep founders up at night, from inventory disasters to supply chain nightmares, because surviving the chaos is what separates brands that fail from brands that scale. Today, I'm talking to Jenny Ripps, co-founder and CEO of Owls Brew.

0:32Jenny's proof that the best way to disrupt an industry is to walk in knowing more about the ingredients than anyone thought necessary. Okay, Jenny, thank you so much for coming on the podcast. I'm super excited for this conversation. I am a fan and a customer and a tea drinker, and so I feel very qualified to be having this conversation with you. And I would love to start with just like the 30, 60 second version of how you got into this mess. Perfect. Well, thanks so much for having me on. I'm excited to be chatting with you and how I got into this mess. My background is beverage development and I started out selling like tea and botanical blends to restaurants, super with a focus on like function and flavor.

1:17Along the way, I thought to myself, along with my co-founder, you know, it's great to be doing something with great flavor and function at three o 'clock in an afternoon that's healthy, like having a matcha, but you know a space that could really use some health benefits is alcohol. So we started hosting tea cocktail parties, started like basically spiking our alcohol with tea and botanicals. And that's why we say, at Owls Brew, we say drink wise because it's all about basically making alcoholic beverages with like very functional ingredients using my background in beverage development. Is that how you came up with the name?

1:51Yes. So yeah, it's all about like know what you're putting into your body. If it's gin, great. And if it's like lemon verbena, also great. Possibly better. Possibly better. Possibly better. I guess it depends on time of day. What is the healthiest way for me to consume alcohol? I think it's by adding tea and botanicals to your alcohol. Yeah. Which is actually the original concept of gin, right? Because that's like a botanical bouquet. Fair. Is that why? Yeah. What's the backstory there? Like, do you know? It's true. Yeah. Yeah. Well, there's a lot of functionality in alcohol. It's funny. I actually studied green medicine and one of the things you learn is that the best way to preserve like the functionality of, I don't know, if you are having like something, I don't know, for your stomach, marshmallow root for your throat, if you actually preserve it in alcohol as a tincture versus water, it's more powerful.

2:43So, I mean, a lot of traditional spirits that are made, like whether it's Aquavit or, you know, Jägermeister or gin were actually made with some functionality in mind as well as flavor, obviously. We used to, well, we spent some time as a team in Chicago every year at a trade show in my first business. And Chicago's famous tinctures, I suppose, is Malort. Yes. I've heard about it from a Chicago team. I'm actually not as familiar with Malort as my, like, the random channel on Slack, my you know our slack channel yeah yeah yeah i highly recommend it's very polar i think though you have to have you have to have a taste for for the you have to have a taste for bitter things i think at the end of the day sounds great um 2020 let's go back in the way back machine you launched and then the whole country shut down which shut you off of a lot of go-to-market things i assume that would typically help propel a beverage brand or any cpg brand kind of on to the map, like store sampling and, you know, shopper discovery and all of that.

3:51So what did you do to still grow like a thousand percent that year? It was crazy. I mean, that was wild. So up until that point, my entire background had been the on-prem, right? I had been creating tea programs for like the Edition Hotel and Sweetgreen and Momofuku. And all of a sudden we were launching this brand after having these tea cocktail parties. And I really understood the on-prem and it went away. So that was really wild. How we grew that year was we, first of all, instead of starting in two or three or four states, which had been our plan, we started in like way more states, like 10 or 12, because we focused on, you know, retailers.

4:33So we grew with Whole Foods, we grew with Trader Joe's and a few other retailers, but But it was really Whole Foods and Trader Joe's and them believing in the product and the thesis and then the fact that people were just shopping at grocery stores all the time. That's all people did that first year of COVID. So it was but it was it was crazy. I mean, it was it was a wild time. However, we did get to see some like early pull and like it was great to sort of see that the consumer was buying our brand new product without, you know, sampling or demos or any information. That was kind of wild. Well, in a way, it almost feels like a hack.

5:09Like that's a huge cost center for an early stage CPG brand. It's just like you have to pay for the promotion and pay for the sampling and pay for the slotting fees and all of that. And I wonder if you got lucky in a way to be able to bypass some of that. Well, it's funny. So like the first we sort of joke that we had to build two business models because we really launched COVID and during COVID. And for whatever reason, you know, we were in the stores, we were flying. And then about a year and a half later, all of a sudden our sales weren't like where we thought they would be. and we're like, what's going on?

5:37And what had happened was big sales teams had gone back into the stores and they were just like moving our stuff out of the way. Just like get this display out. So it's really funny. We were like, there was like a few months where we were like, what is happening? And then obviously, and then we had to like literally look at what it meant to be a BevAlk team, what our org chart needed to look like and totally reconfigure. So it was super interesting. Okay, tell me more about that, the org chart piece of it. And then also maybe I'm guessing this kind of interfaces with, you know, how the alcohol industry has this distributed, well, this not distributed, this system of distributors and tiers and stuff.

6:14And I assume what you're saying when they moved your stuff out of the way is that like the big boys came back in and were just like reclaiming their floor space. Is that right? Yeah. So basically, I mean, in BevAlk, because it is state by state, you know, even county by county in some places, you have alcohol, you have the supplier, which is like us, you have the distributor, and then you have the retailer. And in BevAlk, in regular CPG, you're very lucky if your distributor goes and like merchandises for you. In BevAlk, that's what your distributor does. Like if they're doing what they're supposed to be doing, they're in there checking the stores for you.

6:54And so during COVID, no one was really allowed to linger in the store. So people just dropped the boxes behind, you know, at the warehouse and left. But all of a sudden, the distributors are back in the warehouse and they were like, oh, like, Anheuser-Busch or Molson Coors, you know, they were doing their job for their supplier partners. So all of a sudden, there were big displays, not just like what the store wanted to do, but what the distributors are back. And so we were shifted around a little. Oh, my gosh. And then, okay, so how do you build, so build the org chart with me. So basically, I mean, it's funny, we had the bigger guys came back in, we realized that we needed to hire a bigger sales team.

7:34So where we are now today is, you know, I mean, obviously, that was a couple years ago, but our sales forces are still our biggest investment in the team. We have probably around over 20 people on the sales team. Yeah. And so that's our sort of biggest. That's amazing. It's clearly worked because you got into places that most RTD brands take years to get into. I have some on a list that I'm reading. Disney World, Epcot, SoFi, TD Garden. And it's a different sales motion, like you're kind of pointing at. there's long venue cycles, there's exclusivity and a bunch of logistics stuff, all of which I'm very curious about.

8:18Was that kind of a big part of your strategic planning and evolution of like, you have this moment where you are benefiting from some early success that COVID kind of like weirdly opened this door, then you kind of start to get pushed out and you're like, wait a second, Like, I got to fight back. How much of that was sort of like a direct response to the experience that you were having of being edged out of grocery once the distributors kind of came back into the store? So it's interesting. I think on-prem, I mean, traditionally, Bev Alk has been traditionally, meaning like 10, like 20 years ago, 30 years ago, was built in the on-prem.

8:54But the off-prem is much faster and higher volume. We knew that we wanted to balance the business. We also knew that we needed to diversify the business. Obviously, post-COVID, there were a lot more opportunities to diversify than during COVID. But honestly, a lot of the on-prem had to do with a, like, my background. Just I had come up in on-prem, so I felt very comfortable there. And secondly, being opportunistic. So, for instance, you know, a lot of these venues and stadiums are owned or operated or operated the beverage program by bigger groups like Delaware North or Legends. So we would, you know, we got an opportunity to test at Yankee Stadium and we ended up being expanded by Legends to SoFi Stadium to, I'm trying to think which other, like several of their other stadiums and venues.

9:45Or for instance, at Delaware North, we tested at TD Garden and we ended up getting expanded to, no, sorry, we tested at Key Bank Arena. We got expanded to TD Garden. So basically a lot of it was just that it was working at the stadiums and venues. Disney took years of my life of bothering them for them to let us in. But we've been expanded, you know, now we're at Epcot. We're sold on Disney Cruise. So a lot of it, honestly, what I love about the on-prem is that the consumer chooses, right? Like in off-prem, you can have all the, like what you said, like, you know, you can have your displays moved.

10:19You can have sort of bad placement. You can have, you're not in the cold box. You're on a bottom shelf. You're on a top shelf. There's something like super pure about the on-prem where it's just like consumer chooses. I mean, they look, especially at a stadium or venue, they look and they pick and they choose what they want. And, you know, when it's your brand, that's awesome. It's got to be so satisfying to kind of win on an even playing field like that, right? Yes. I love it. I like even playing fields. Even playing fields are good for, you know, smaller businesses. Yeah, totally. Yeah. Yeah.

10:52Yeah. Tell me a little bit about the product development life cycle for you and how you have, I think, so is it three? Do you distinguish for yourselves that it's kind of three different lines that you offer? And tell me kind of like how one led to the next or what customer signal you were seeing that kind of fueled the product development, you know, spirit, no pun intended. Yeah, of course. So we sort of overall our universe is this idea, this sort of this drink wise, right? Like we want to use really good ingredients to make really great beverages, which sounds normal, except in BevAlk, which is an industry where, you know, sometimes people don't think about the fact that like your bottle of vodka has no nutritional panel.

11:37Neither does your glass of wine. Neither does your, you know, RTD. If you think of your favorite RTD, whether it's whatever that is in a can, they don't have nutritional panels. So basically, first of all, first and foremost, it's like our values. And then we take our values and we try to meet our consumer where he or she is in their lives. And so that's a lot of what drives our innovation. Like in our insight is, okay, what is our consumer doing? Where are they going? And what type of product are they looking for there? And can we like meet their needs without like overextending? So our three product lines, we have a line of spiked pop, which is hard soda done clean.

12:18And the idea behind that is if you think about, you know, like the way root beer was made traditionally, it was made with like dandelion root and burdock root. It was good for your stomach. And then somehow it became like caramel coloring and like aspartame. But the idea is like to take hard soda, take soda, make it with benefits and then spike it, but have it like be like very fun and like delicious, but also beneficial. So that's our spiked pop. We have a line of spirit-based RTDs. So we have a partnership with Chelsea Handler, the comedian. We have a vodka lemonade with her, a few other spirit-based products that are more like ready to drink cocktails.

12:54And then we have a line of non-alcoholic mixers. So that's our third product line. And those are sold and poured at like Disney World, many, many, many places, Yankee Stadium, Epcot and others. And did you do it in that order or did you start with the mixers and then go for it? We started with the mixers. And that because that's sort of related to the original genesis of the idea, which is that you can kind of like take any alcohol that you have like, I don't know, lying around, so to speak, like make it a little bit more functional and a little bit more delicious. Exactly. And you can sort of, you know, make a non-alcoholic drink and an alcoholic drink and you can control exactly what you're drinking and benefits.

13:40So that's it. That's exactly right. That's a hard, like the functional non-alcoholic mixer is a hard category to play in. And I know in part because, so one of the things, one of my businesses buys distressed consumer brands. And I've seen a few in this category really struggle. And my observation and sort of like going through diligence with them and looking if basically it's my job to see if we can give a brand a second life when they're in a situation like that. and one of the challenges that seemed to infiltrate these couple of ones that I looked at and I'm just kind of curious to hear your take on it is is almost just like communicating to the customer what the product is and like when they should when they should be enjoying it like can I have this by itself should I always be mixing it with something else it's in a smaller format in the smaller can is it anyway I would love to hear your take on just how customer communication has landed to almost like create the category or like split.

14:38It almost feels like you have to split a category. And it's not like zero to one-ing, but it is definitely like a communication challenge. So it's our strategy with Mixer is like 95 % on-premise to answer. And by on-premise, I mean, it's B2B. Like we are selling to bars and restaurants and hotels, like for us, so you're right. We are about to launch, we are launching the Mixer direct to consumer. So we will be telling that story. But actually selling it at retail, which we messed around with a little bit, we ran into exactly the problem you're describing. I think it's a tough category. I think actually today it's more relevant than it ever was.

15:17Like I think even three years ago, four years ago, five years ago, it was harder. But I think the consumer is so much more curious and educated now that they understand better than ever. but I agree with you the mixer category it's half a cocktail it's in a weird place on the shelf there are some retailers that it makes a lot of sense and there are some retailers where you can like die trying to tell that story but but that's why yeah so that's why like the on-prem like we work with um Hyatt hotels I mentioned some of our other partnerships we work with a lot of stadiums and venues, but in a lot of cases, the bartender understands what the hell it is much better than the consumer on the shelf.

16:02It's sort of their job. That is sort of. So we're not really trying. Our off-prem product really are the Pops and the RTDs. Yeah. Okay. That makes a lot of sense. Yeah, it was interesting in some of these conversations, like there was a search for just like, what shelf are we going to be on? Are we a mixer? Are we a cocktail? Are we in the fridge? and lacking, I don't know, almost like advocacy within the retailer to like be decisive about that. They just ended up everywhere and nowhere in different stores. And then the customer kind of didn't have, you know, that muscle memory path to like discovering and to rebuying.

16:39It's 100 % true. I mean, I remember years ago that, you know, it was just the whole, so Whole Foods used to set things up regionally. And I can remember that he, what's he back? Sorry, I have a vestibule and it just went off. Oh, perfect. So anyway, I was like, is that also my computer glitching? It's been so interesting tonight. I remember like, so Whole Foods years ago, the Whole Foods mixer buyer in New York was the beer buyer and the Whole Foods mixer buyer in Colorado was the dairy buyer. And so, you know, like, what does that mean? How can you possibly have a consistent mixer set? And then, of course, state to state, you know, there are some states where in grocery you can put alcohol.

17:25Right in Florida and California, you can sell alcohol in grocery stores. And in New York City, you can't. So, again, that muscle memory is a real issue in the off-prem with mixers. You're right. It's so great. The on-prem move is so great because, well, one thing, clearly you have like an area advantage there. So now you're unleveling the playing field, which is smart. It's a small business versus your competitors. The other thing I love about it, though, is that for those who like this is if the purpose of this conversation is sort of like to help other people, you know, walk a hard path. know that depending on the avenue of distribution you select and optimize for and kind of like lean on, you can find your way into like the right channel.

18:19And that might not be the one that kind of like, you know, that everybody's the most familiar with. It might be something like that, you know, is a narrower path to get into or requires like a little bit of industry knowledge. But if you if you kind of chip away at it, you can take something that for what it's worth might have died through a different distribution path and like make it wildly successful by choosing how you're going to distribute first. Exactly. And I think, you know, D2C is another good example, which obviously is a, which I think is a pretty, is a more obvious example than saying where we chose to go through on-prem.

18:51But for us, you know, there's a halo effect with the on-prem where we can create value for an account by giving them a great mixer product that's half a cocktail while having placements of, you know, pop or RTD that are more high visibility for us. So it's sort of, for us, we end up when we work with restaurant or hotel partners or venue partners, I like to think that we're like almost creating more support or more solutions for them through Mixer being so versatile, even though it's a high visibility play. Well, so, but, so yeah, D to C, I mean, there's so many channels and I agree with you. You have to think really carefully about what channel you're going into.

19:30Like some channels can kill you. Well, and you just said high visibility, which is a perfect segue to the question, like a burning question I have. How much when you're on-prem do you get the lift of brand visibility? Like when I'm ordering, you know, Owl's Brew as part of a cocktail, do I know that it's Owl's Brew or do you find that you have to kind of go this next layer of brand awareness and creation because really like, you know, the mixologist is doing a lot of that work, but they're just calling it habanero margarita and not like Owls Brew habanero margarita.

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20:43Jennie Ripps:Ready to ditch the chaos? Visit endlesscommerce.com. Mention commerce is chaos when you reach out and get three months free because your op stack should be your competitive advantage, not your biggest headache. Right. So listing on menus, right, is the next headache of the on-prem. I mean, across the board, I mean, whether it's even with spiked pop, you know, it's like spiked pop is meant to be a soda made with functional ingredients. We don't want to be called a tea soda because that sounds really weird, right? Like a weird tea soda is strange. So, or like not as commercial. So on-prem listings are always, you can never, if you want to sort of spend, you know, 10 hours looking deeply into something, you can look at your menu listings and just really go down a rabbit hole.

21:31I do. Right? So yeah. Some of the truth is it's our higher visibility product are the ready to drinks, whether it's the pop or the RTDs. Sometimes we're listed as mixer. We always we always want to be. We are not always. I've certainly walked into some really great properties, read their cocktail menu and been like, how are you making that? And have them, you know, go into a back closet and pull out our mixer and like definitely we're not on the menu. But I think that's okay because we assume that it's going to happen. I think it would make me crazy if Mixer was my primary product and it wasn't part of this overall universe.

22:16We're offering a suite of solutions to the on-prem. Yeah. And it's almost like in that motion, you can be a little bit less maybe sensitive to the awareness of the end consumer because your customer is a B2B customer in that context. And like they're highly aware because they're like opening the cans all day long. Exactly. And they know it's a great product and that they love working with it. But we did recently, it's funny, our mixer had only been in the 750s behind the bar. And we recently launched mixers in cans and they're going into a bunch of properties. Like I think, are you out in California?

22:55I am, yeah. You are. Okay. So we'll be at, sorry, Poppy soon and Keys, like nightclub in Little Cans. So I think there is some, the Little Cans give us additional visibility. They'll be sold in some Hyatt hotels. So that was one of the thoughts behind the Little Cans was, you know, something a little bit less bartender centric. Got it. Very cool. Can you give us a sense of what's next for the business? And it could be, Sam, let me just do this thing first. It's right in front of me. But do you have flavors in development? Do you have formats in development that you want to share a little bit about?

23:36So, I mean, Spike Pop was a huge pivot for us. We just launched it and launched it like as hard as we've ever launched anything about three or four months ago. That being said, we do have one of our most popular flavors has been our cream soda, which right now is only sold in a variety pack. And we're doing an entire like cream soda thing for the holidays this year. So sort of think like affogato, think, you know, presky cream soda, also like ice cream floats with like the cream soda. So cream soda sort of in a single pack is going to be one of our, like, not really innovation, but just an updated format, thinking about seasonality.

24:20And then, yes, in 2027, we have a couple things coming down the pike that we're excited about. So cool. Flavors. Yeah. All right. We'll do a follow-up with the lunch. Yeah. Perfect. We'll do a lunch pod. um let's go back to um you you shared a few moments ago um your thought process around sort of putting functionality and better for you at the forefront of the messaging as opposed to like t itself and um i want to double down on that because i'm as i'm looking through as we're having this conversation and i'm sort of like i'm meandering through the website and i'm uh and i'm looking at the way everything is positioned, you're right.

25:03You're not really saying this is tea plus alcohol. You're saying this is just a better functional format for you. And it happens to have tea as part of the ingredient list. That's very intentional. Yes. I mean, so when we think about functionality, you know, there's a whole universe of functional beverages for us. We sort of start in your garden, right? Like it's like basil, strawberries, raspberry leaf. Like I think there's a whole universe of functionality that almost gets bypassed because there's so much like more like hardcore functionality now with like methotics and adaptogens and like, which is great.

25:45But like there's a universe like vanilla is a natural mood booster. Like, you know, I mean, Yerba Mate has, you know, is a naturally energizing product which functions a little bit differently than a green tea in terms of being caffeinated. So, yes, we build beverages. Sorry, there's some background noise. We build... That's my daughter. Don't sweat it. Okay. But if she comes in, we'll say hello. Perfect. So our whole idea is to basically use, instead of using flavorings or added flavors or anything like that. It's like, how do we make something taste like a cream soda? And what do we have? What do I have at my disposal as someone who, you know, has developed beverages for years?

26:38I'm a tea sommelier. I have a certification in green medicine. And like, all of that is only to say, like, how the hell do I make something taste like cream soda without adding vanilla flavoring? That is like always the question. And how do I make sure it's kind good for you. So for instance, our cream soda has real vanilla beans and green rooibos. And rooibos is a South African bush. It has like trace minerals in it. It's high in antioxidants. I think in South Africa, athletes drink it. It's like nature's Gatorade. I think there's a little bit of electrolyte action going on. But the idea is why do I use those in cream soda?

27:16So obviously vanilla. I want that creamy vanilla flavor, but there are two kinds of rooibos. There's green rooibos and there's red rooibos. And red rooibos is red because it's more oxidized. Red rooibos sort of tastes almost like whiskey-like to me, but green rooibos almost has like cotton candy mouthfeel. So when I think about cream soda and I want that like light, like cotton candy, like creamy thing, that's why I'm combining those. But I also happen to know what the health benefits are of those ingredients. So it's not really about tea. It's not like using plants, whatever they are. If I want to make our black cherry soda, I'm going to use black tea for tannins, but not because it's tea.