Poppi: Allison and Stephen Ellsworth. From Farmers Market Vinegar Drink to $2B Soda Sensation

27:08You guys have to be in Whole Foods. But we didn't have good labels. We didn't really have nutritionals and done the testing to where you have to be at the level to be in a grocery store. One, you can't make it in your house to be in a grocery store. So we thought, oh, my gosh, we got this card. We made it. little did we know we weren't even on shelf till 10 months later. Yeah. And she was she was she was offering you what one Whole Foods or two Whole Foods or what? No, we we thought it was national Whole Foods. She was offering you a few Whole Foods stores. We didn't even get into the planogram.

27:42So we from the moment we got the card from her, we at that point went and got a lease. We opened up our own manufacturing facility thinking we were going to be nationwide Whole Foods for them to say, no, no, no, no, you don't even have Dallas. We've given you a license to go hunt for it. And what that means is you actually now have to go store to store and sell in your product to every single store at that time. And it was 14 Whole Foods, Dallas, Fort Worth. And so we went all in thinking, oh, my gosh, we've made it. We're going to get all this. Little did we know we didn't get anything. We still had a lot of work to do.

28:17When we come back in just a moment, Allison and Stephen are told that their branding totally sucks. Stay with us. I'm Guy Raz, and you're listening to How I Built This.

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29:57Hey, welcome back to How I Built This. I'm Guy Raz. So it's around 2016 and a buyer at Whole Foods has encouraged Stephen and Allison to ramp up production of Mother Beverage. And you'd think that they'd find a bottling plant to partner with. But they don't. They end up renting their own warehouse because no co-packer wants to work with them. So there was one big hurdle. We were totally unpasteurized. We wanted to have raw, unfiltered apple cider vinegar in our product. And so there's many reasons why co-manufacturers don't want to do that. There's many reasons why even craft breweries who were smaller and were more willing to maybe do something at a smaller scale for us were unwilling to do it.

30:47Raw, unfiltered apple cider vinegar, unfiltered, you've got the floaty stuff in there so it can get in their lines. It could potentially contaminate other products of theirs. The raw factor, it's got acetobacter in there. And so that can cause their beers to sour. That can cause other issues in other products, as I mentioned. And so being unpasteurized, being raw and being unfiltered, there just weren't co-manufacturers that were honestly willing to take us on and take that risk. But really, for this first initial run at Whole Foods, maybe even the first year or so, this is all being made by hand, basically.

31:23Correct. You were like pouring vinegar into vats and what, pouring fruits into the vats? It's like, what, tell me about the process of working in the warehouse. It was kind of crazy. I remember like being on the bottling line and it's really difficult to bottle a carbonated drink. It seems like such an easy thing. But if you think about it, you go to the soda fountain, what happens? You pour it in your cup, it bubbles, you know, foams over, it goes everywhere. And so we were just like, we're racking our brains. Like, how, like, how does this, how does this happen? And it was really interesting.

31:59It was probably one of the most frustrating sort of experiences and journeys for me to like get the carbonated product into the bottle without it foaming over in a timely manner. Yeah. How I mean, how were you doing that? It was like it was like a soda fountain. Like you go to a burger place and you've got your your soda fountain and you just put your cup under it. Was it a version of that, but with bottles? we got like a forehead filler right like a professional forehead filler where you put all of the glass bottles underneath it's supposed to suction it so tight that you fill it and the air doesn't get in it's supposed to fill and you had that we did we bought we had two of those so we could do eight bottles at a time we had two lines set up and we would just try to figure out a way to get this but it would work for like 20 minutes and then not work for three hours and we would be there for hours just filling product to maybe get, you know, a couple hundred bottles out the door.

32:56It wasn't scalable. I would say that was the hardest part of the business was the filling, the making it, the steeping, the quote-unquote syrup was the easiest part of it. All right. You're sort of working on this for many, many months, and now it's time to go into Whole Foods. And did you start with just one Whole Foods in Dallas? So we were able to sell them into, I think we got into maybe eight of the stores. From the beginning. Correct. But the beauty of getting into Whole Foods opened up a whole other avenue on the distribution side. So you can't just self-distribute to someone like a Whole Foods.

33:39So it opened up Unify, which then opened up other accounts. Unify is a distributor, and they required you to work with a distributor like Unify. Yeah, and it's hard to even get into them. It's like the chicken or the egg, like get into Unify if you don't have a retailer. If you don't have a retailer, you can't get in. So it was kind of nice for us right from the beginning to kind of have Whole Foods that they took us in. But then that opened it up to be able to get into other accounts around the Dallas area. So we got into the Royal Blues of the world, which is like a Dallas grocery store. We were able to get into some natural grocers and, you know, just local sandwich shops.

34:15And so we had a good presence in Dallas, not just the 8 to 14 Whole Foods. And when you were in – okay, so when you started out Whole Foods, right, you've got a distributor because that's part of the requirement. How did you then get people to be aware of it? Would you go in? I mean, by the way, you're also – the two of you also have a baby, a brand-new baby at home. So tell me how – what you were doing. You were going in and setting up a table and just asking people if they wanted to try this new product? Anything. anything. We were doing Instagram posts, gaining followers. I think we had like 10 ,000 followers on Instagram.

34:52We had a little website. We were selling the product on our website as well, which was really difficult. If you think of how do you ship glass bottles that are liquid through the mail? We did that. I mean, it was just like anything and everything, but we didn't do any paid media or have any know-how to do anything like that. We also had no money. Yeah. How about employees, Stephen? I mean, both of you guys are running this business together and then I have to assume you could physically do everything and load the bottles into the car, into the cases and all this stuff. Like, did you hire temporary people or did you start to hire like full time people to help?

35:35Yeah, so we had, yes, we started to hire folks that would manage the farmer's market stands on the weekend. And then I hired a crew of maybe six or seven sort of production members. They were, most of them were 1099. There was a few W-2 employees, but they would do everything. So they would come in, we would probably work nine to 12 hour shifts, five days a week. But we weren't paying ourselves. So keep in mind, quote unquote, yes, we quit our jobs. But Stephen found a job that he could do at night to pay our mortgage. So he was still working a second job basically this whole time. Yeah, it was really what allowed us to reinvest everything that we were making at the time.

36:24All right. This just sounds like a crazy life, right? Because you are trying to expand the business. You're trying to get people to buy the product. How was it doing? I mean, was it a hit at Whole Foods? I mean, hit is a relative term, right? Because it's not like all of a sudden there's a windfall of cash. But was it successful more or less at Whole Foods right away? Yeah, I honestly think we had some really great traction, right? It wasn't at this massive scale, but every week, every month, our sales would continue to increase. We would get more notoriety. We'd get better shelf placement in Whole Foods.

37:04We would move from the dry shelf to the grab-and-go coolers at the front, or we would get an end cap or something like that. And so, you know, we were starting to really see that progress and people started to notice, so much so that there was a segment called Shaping DFW. And ABC actually reached out to us. They said, I love what you guys are doing. I really think that you guys are in the forefront. You're helping to really shape this new wave in DFW, Dallas-Fort Worth area, of better for you, sort of health and wellness. This is a local TV news channel. Yeah, it was a seven-minute segment. Honestly, that was a really beautiful piece for us to be able to take that and say, hey, this is going to be on the networks.

37:47Give us more shelf space. Give us more Whole Foods, right? And so I think the category review was coming up and they had basically accepted us into more of quote unquote Whole Foods, what would be called like a global rollout where each individual region has to accept you. And I think we ended up getting into seven regions across the U.S. So obviously something was working and this was like the next step where we're like, okay, we're going to go into nationwide. We need money. And so we kind of were looking at each other like we need to figure out manufacturing. We need money. It was crazy. What kind of sales were you doing in the first year?

38:29Like over half a million dollars? I wouldn't say it was that much. I think when we went into Shark Tank, I think it was – we had done about a half a million dollars in revenue in the previous 12 to 18 months, something like that. So we were putting together like a couple hundred thousand dollars. All right. So the product really launches in 2016. And I want to talk about Shark Tank because this happens – your episode appears in 2018. I don't know when you filmed it. Tell me about the Shark Tank strategy, because clearly this was a strategy to get attention and maybe to attract some investment and to kind of supercharge the brand.

39:07How did that – was it a conversation that the two of you had that you thought, hey, let's try our hand at Shark Tank? No, we actually had someone approach us who was a fan of the brand, wanted to invest, and he was going to give us around$200 ,000 and had no resources. He didn't know anything about CPG. He had no employees, no retailer connections, nothing. And it just didn't quite sit right with me and Steven. He just had the money. And I think like as any entrepreneur, the saying of like, don't take dumb money was always something I think most people know, right? That's not anything new. And I was on my phone, I think like two days later after him offering this money.

39:47And I saw Shark Tank was coming to town and they had open casting calls in three days. so we went and stood in line amongst hundreds of other people it was an eight-hour ordeal and we just pitched our hearts out and immediately after pitching our product which you only get two minutes to pitch elevator pitch they were like this is a fantastic product you guys are definitely going to make it to the next step and then it goes dark and you're like we're gonna make it on shark tank and then you don't hear anything for a few weeks and then they're like oh hey fill out this paperwork and then they go dark.

40:19And it's just like a very long process. But at that point, even the thought of getting on Shark Tank, we did tell that other investor, hey, we have to see this through and see if we can get a deal on Shark Tank. And so we said no to him. And so you find out that you are going to go to LA and appear on Shark Tank. And usually the way it works based on conversations we've had on this show with other people who've on it is that you film it and then a few months later it's it it airs and you're not always sure whether you're going to be on it i mean usually they kind of give you a heads up that you're going to make it on but they do cut people out um i guess 2018 you both fly out to la to film your episode so i was pregnant with our second i was three months pregnant with our second when we that elevator pitch.

41:11And then it basically took six months for us to go through that process for them to finally say, hey, you guys are going to be on Shark Tank. So I ended up being nine months pregnant on Shark Tank. And the thing is, they wanted us to be matched up with a certain shark, right? The end of the day, the show wants you to be successful. They want you to get a deal. And so through the ups and downs and learning through all that, we fly out to LA, You know, the night before they tell us who our sharks are. And then we go in the next day and we pitch. You go on. I know that you don't normally meet the sharks until the screen opens and you walk on stage and you start pitching.

41:50And one of the sharks was a guest shark, Rohan Oza, who had been involved in branding around Coca-Cola products. And he was involved in Bi and he'd been involved in other, I think, vitamin water. I can't remember exactly what. Tell me a little bit about – so you make the pitch and people can see it. and were they did you feel like I guess you know sometimes they're not always so nice did you feel like they were nice to you guys no no Mr. Wonderful called us an apple cider vinegar roach they didn't get that we were an apple cider vinegar drink like what were we doing who are we someone else that was on was Bethany Frankel who kind of has some beverage experience as well and We were really excited about her, even though she was screaming at us the whole time because we made her take a shot of apple cider vinegar and she wasn't too happy about it.

42:44And they didn't like it? No, they don't like it. Beverage is also very difficult. It's very capital intensive. If you don't know how that world works, it's hard to find the right investor. And honestly, the right investor for us was Rohan Oza. Was it clear to you right away that he was interested, that his questions were different from the others? You know, it's hard to track that on whether or not he was asking serious questions. But I also know sort of looking back, he was definitely playing it cool, right? He was definitely not trying to show his cards. You know, he leaned in and he was basically like, you know, the product is great.

43:25You know, he's like, I'm interested in this thing. But he's like, it's going to cost you a lot more than what you're asking for. What were you guys hoping for? I think we initially went in there asking for$400 ,000 in exchange for 10 % of the business. So you were valuing your business at$4 million. We knew it was high. But I mean, we had worked with the producers to basically say, hey, listen, like, you can't go in asking for the number that you think you're going to get. You got to start a little high. And so ultimately, I think it was we ultimately landed on what I think was a fair valuation and definitely gave Rohan enough skin in the game to be energized and excited about being helpful.

44:11So looking back, that's not normal to walk in and ask for that amount of money. Usually people ask for$50 ,000,$100 ,000,$200 ,000. It's a lot easier for a deal to get done. So us walking in asking for$400 ,000 is quite high. And so he did come up to the 25%. And I'll be honest, we looked at each other and we immediately said yes, because we just knew he was the right partner for us to really take it to the next level. So when he offers you four grand for 25 % of the company, but the other thing I guess was is that Rohan says to you guys, hey, this has to – you need a complete overhaul, a complete rebrand.

44:52Tell me about what he said to you and how you reacted to that initially. He basically said, look, you have a fantastic story. You have a fantastic product, but your branding is shit. And honestly, it didn't offend us because we knew we had spent so much time on the product. We'd never thought about the brand or the marketing piece of it. And it was such a piece that we were so desperate to kind of figure out that we were like, yep, let's do it. We were like, let's change the name. Let's do the whole rebrand. We were so here for it. And what did he say needed to change? Everything. but we were okay with that because we had already decided that we were going to change everything we wanted to change the name the position at this point it was apple cider vinegar drink and he was like no this is so much bigger this is soda and at the time we were like well we don't know for soda like that's a big word to like chew on that's a huge category so let's play in this functional soda space which is like a whole new category that no one had really been able to figure out.

46:01And kombucha had tried to take on soda. Sparkling water had tried to be an alternative to soda. No one had quite figured out this disruptive soda space, right? And so we're like, let's play adjacent to soda and be better for you soda. So we took about nine months and we did a huge branding exercise. Like what is, if we're a car, what kind of car are we? If we're a girl at the party, are we the cool girl? Are we the girl dancing on the table? Like what is the personality behind us? Are we approachable? Are we funny? So we did all of this work. It was me, Stephen Rohan and Rohan's partner, Stevie.

46:37And it was just us four for about nine months. What are we changing the name to? We landed on Poppy, which is a play off of soda pop. We weren't sure if we were going to do white cans or colored cans, right? Because white creates this like healthy halo. It's clean girl aesthetic. It's, it's, you know, clean and fresh, whereas color kind of screams flavor. It screams fun. And we wanted to approach health and wellness from a fun lens versus a niche better for you lens. Um, it was probably one of the bigger disagreements at the beginning. Me and Rohan were leaning more on the white side because I was like a purist.

47:14And then Stevie and Steven wanted to do colored cans. We ended up printing the cans and we took them to the grocery store And we placed them on the shelf and we stood back and we were like, which one looks best? And hands down, I will say I was wrong. Colored cans were the way to go. It just popped off the shelf and no one was doing better for you with color at the time. So, OK, I want to get to that. But in this long period of time, between the time you signed an agreement or got rolling on as an investor and you relaunched it, you were still selling Mother Beverage. and I'm assuming when the Shark Tank episode came out, there was a lot of interest in Mother Beverage.

47:54We did have a spike, but on the back end, we started to do roadshows at Sam's Club. The business continued to grow. So we really had to do both. We had to rebrand, reposition, do all of that great work while sort of keeping the core business in steady state. We still had bills to pay. We still had a warehouse. We still had overhead. Well, we went through all of that stuff of Whole Foods had taken Mother from the 14 Dallas Whole Foods. We were in the local shops. Now they've accepted Mother beverage into seven regions of Whole Foods. So then we basically had to go back and say, just kidding, we're changing the name, we're changing the packaging, will you guys still take this?

48:39and so there was a lot of risk to that to basically have the grocery store that kind of give you your start saying like we love what we did but we're going to give you guys something completely new and then we realized like we're going to call ourselves soda we can no longer be in glass bottles we 100 have to be in 12 ounce soda cans and so we had these manufacturers set up and basically what we were like two days away from our renewal and you had to call them and basically cancel the whole PO. It was quite a crazy... For the glass bottles. Yeah. Yeah. We ultimately decided to go 12-ounce soda cans, colored labels.

49:20But the tricky part about that was is we had a National Sprouts rollout. We had a, you know, almost national rollout at Whole Foods with no manufacturing. So we basically had six weeks worth of inventory to basically sell through our mother beverage, keep our current customers happy while setting up a new supply chain with new co-manufacturers, learning that whole thing within six weeks to get ready for a launch. When we come back in just a moment, Poppy's big launch in March of 2020 is completely derailed. Stay with us. I'm Guy Raz, and you're listening to How I Built This.

50:14Hey, welcome back to How I Built This. I'm Guy Raz. So it's March of 2020, and Mother Beverage is rebranded as Poppy. And it's ready for its maiden voyage at one of the biggest trade shows in the country, Expo West in Anaheim, California. Yeah. We were using this tentpole event as being our launch, right? So we had spent a lot of our money on, I think like almost$90 ,000 on building a booth. You know, you have to pay for the space, you have to get product out there. It was like our big bet to come out and like meet retailers and really put Poppy at the forefront of everyone's mind. And we ship out to Anaheim and we are one of the brands out there, half of the people don't show up because I think on our flight to Anaheim, there was 10 cases in the U.S.

51:06And we're like, oh, this is going to blow over in a week. Like, we've put a year into this and, you know, years passed with mother, like, we're doing this. And so we get out there and then a day into it, they canceled the entire thing. And at that moment, it was just so devastating for us because we're like, oh, goodness, this was our moment. Where do we go from here? We pack up the booth, we get back on our flight and on our flight home, there was hundreds of cases, right? It just had escalated really quickly within COVID. And we were so thankful that we had loaded in a ton of product into Amazon.

51:44Grocery stores basically told us, we're not going to cut you in. We're more concerned with putting toilet paper on the shelf. So we kind of just focused on Amazon. We didn't do anything on our own website for the first little bit. And it was the first time everyone in the world was thinking about their health and wellness. They were thinking, hey, how can I pantry load on things that are shelf stable and that they taste good? And so we just really leaned into that thinking for the first month and a half of business before everyone kind of started figuring out this whole COVID thing. But I mean, imagine initially you were really nervous.

52:22You were worried. we were devastated i think allison and i were talking about this i think one of like the entrepreneurs are slightly delusional right maybe we don't have we're delusional optimists and so i think it was it was we were in a good position because we didn't have a ton of overhead we didn't have a ton of employees to support you know we were we were a really lean team and we were growing right and so we didn't have a ton of things to support and so it really left us in this opportunistic situation where we were able to be agile and disruptive in our approach to market and how we interacted with consumers.

52:59It was a lot of pressure, but it honestly like forced us to think really outside of the box. All right. So there's an update on Shark Tank. I think that airs in April of 2020, just kind of an update on what's going on with your brand. And that, I think instantly you get to boost, right? And on most of your sales at this point, are through Amazon, direct to consumer. Yeah. So we were mostly on Amazon and then in April, grocery store shelves were starting to do the load-ins, kind of had gotten their feet underneath them. We were kind of starting to hit the retail shelf and we had filmed an update on Shark Tank about Poppy and the brand and it aired Friday night, second week of April, and it just blew up.

53:46So we hit number one on Amazon's hot new product list. We're doing like 3 ,000 on Amazon quickly over the next few months. We're doing 250 ,000 on Amazon a month. It just like absolutely blew up our business. And really, it was really eye-opening for us to have a national commercial month two, basically. National commercial, it was a shark tank. Shark tank, yeah. A free commercial, basically. You know, so this was really the big spike in our business. And as Allison said, we were thankful that we had onboarded Amazon. We had shipped in what we thought was a lot of product into Amazon. I think we honestly sold out of that in like the first couple hours after it launched.

54:24Tell me about – I mean that – and we've heard this before, which is a Shark Tank episode can really boost sales. But then it can slow down. Then things can slow down and people stop ordering. I think for you guys, what really helped in some ways, because it's still COVID and people are still not, you know, people are going to grocery stores, but not, you know, it was a different experience. I think for you guys, social media really became a lifeline, especially TikTok. Tell me a little bit about how you started to use TikTok and how that began and how you used it. well for us at that point I remember at the update shark tank there were some tiktokers dancing in the whole foods that we were filming in and some one of them grabbed my phone and downloaded tiktok on my phone and I remember getting on it and playing with it and it really was no brands no brands were on tiktok at this time a lot of people were introduced to it through covid and kind of were bored at home and started creating so it was like this creator platform and I just in my head kept thinking there has to be a way to market to people on here.

55:35There's hundreds of thousands of people now, you know, millions on there and it's free marketing. So I remember being like, you guys, TikTok's the next wild, wild west. We've got to do it. Rohan and Stevie, including like Steven, he was like, I don't know. Sure. Like no one really got it. And I just was like, okay, I'm going to get on. I'm going to spend my nights and my weekends and I'm just to start posting. So I started doing recipe videos. I was dancing. I was doing transition. I had my kids running around in it. I made Steven be in him with me and I was just trying literally anything. And honestly, one night I sat down on the couch and I just told my story.

56:11I did it in one minute or less of started this in my kitchen, got a deal on shark tank. It's five grams of sugar. It's apple cider vinegar. It's this da da da. And I posted it and went to bed. And when we woke up, we had sold $100 ,000 on Amazon that night. And everyone started calling, where did this spike come from? And no one thought to look to TikTok. And so I was like, you guys, we went viral on TikTok. And then everyone's eyes were open from that moment. That's amazing. I mean, the growth of the product really just kind of explodes after the launch, the rebrand and the launch in 2020. By 2023, it's 100 million in sales.

56:52And then, you know, it's like, you know, the next year, I think it's 500 million in sales. I want to, I'm curious, what were you, were you thinking that, that regular soda was your competition? Or did you think that sort of better, quote unquote, better for you drinks or less sugar, lower and sugar drinks were your, your, your competition? Look, I think we created a brand new category. So when we had Poppy going to grocery stores, they didn't know where to put us. So in the early days, they put us next to sparkling water. They put us in the enhanced water set next to the buys and the vitamin waters and the coconut waters, you know, just a little bit of a higher price point, because if you were to put us at that point with a product that was kind of not quite proven, not a lot of consumers knew about it.

57:40And you put it at$2.50 can next to a 99 cent soda can, there would have been a disconnect. So for the first few years, we worked with the retailers figuring out what is poppy and what category does it live in? Even though on our end, we always knew our mission was to revolutionize soda for the next generation. And so as we grew, as our awareness grew, we slowly started to carve out space within the soda sets. and now we have an entire new set called the modern soda set in retail and in grocery stores that did not exist five years ago. Yeah, and I think it's really interesting. It goes all the way back to the positioning work.

58:21We were the first ones in the functional, you know, sort of modern soda to actually call ourselves a soda. We call ourselves a prebiotic soda. We were the first ones and at that point in time, it was crazy because soda was at the pinnacle of a dirty word, right? It was sparkling water. It was like, Ooh, who drinks soda? Like, that's so bad for you. Like, why would you ever do that? You know? So it was really a bold decision for us to put prebiotic soda on the front of the pack. And as, and as Alison said, I think it was just building on building year after year, month after month as we, as we gained a bigger audience.

58:58I'm curious. I mean, better for you is a tricky word because, you know, a lot of people clean and You know, there are other terms that are not, you know, sort of technically legally sort of defined. But obviously, poppy has considerably less sugar than a can of Coke, right? A can of Coke has, what, 25, 30 grams of sugar, maybe more. Poppy on average, I think, is five grams of sugar and it's got a little bit of two grams of fiber. And so how would you identify the people who are buying it? Were they buying it because they felt like it was healthier or were they buying it because they liked the taste?

59:32Or like, what did you start to find out like about the people buying it? Were they buying it for its perceived functional benefits or for completely different reasons? Well, basically, we were able to lean into the brand versus, hey, drink this because it's better for you. Nobody likes to be told to do that. They want to we were intentional with the consumer journey. We wanted someone to see the can and be like, that's so cute. We wanted them to sip it and say, wow, this tastes amazing. And then we wanted them to flip around and read the nutritional and say, whoa, this is better for me, too. So when did it start to become clear to you guys that – and I'm assuming when Rohan got involved, part of the conversation was, well, there's got to be an exit here, right?

1:00:21Maybe it's an acquisition or we go public or something like that. And I imagine that once you hit$500 million, maybe even once you hit$100 million in sales, you start to get interest in potential acquirers. yeah i think um you know we've we've had one of the fastest like the fastest journeys in sort of beverage history we we grew triple digits year over year until we sold once we rebranded from poppy you know i think that we were in a really interesting period of time we were operating in a covid supply chain you know cans now cost 11 cents we were paying 40 cents for a can during covid we You were shipping containers of essentially air, empty aluminum cans all the way from China, just so we could fulfill the demand.

1:01:10And so I really think that that was when, you know, we thought that we had something as far as an acquisition goes. But I think every year we just continued to see the business more than double. I mean, honestly, from day one, we knew we were going to sell. So, like, let's be real. So basically in the world of beverage and in particular soda, you have two avenues. You can sell to a big strategic or you can go IPO. Well, IPO is great, but you don't gain distribution partner like Pepsi. So for us, we let me just give you an example. We are the official soda of the Lakers and we're not allowed to be sold in that stadium because of contracts.

1:01:54So now us getting bought by Pepsi, which is incredible, we now can go from 50 ,000 locations to 350 ,000 locations, right? Because they have massive distribution. I think it's not a secret. Pepsi acquired Poppy in March of 2025 for almost$2 billion, which was just incredible. I mean, between the time you launched and March of 2025, it was essentially five years. correct and it's interesting when we first started out it was just us and our story and poppy for the first few years and then a really big tipping point for us was doing our first super bowl ad where we really gained that cusp of we said we were a soda the future of sodas now we kind of put like our flag in the ground in our ad we said soda 17 times and that we were the future of soda and after coming out of that our awareness tripled overnight we started getting some interest from the strategics, which was always the goal.

1:02:54And we kind of like went from mom and pop brand to challenger brand to established brand, which is really, and we did it really quick to your point in five years, which is absolutely unheard of. You know, we thought we were going to double the business from 22 to 23. And instead we forexed the business. And in large part, it was because of the Super Bowl ad, we planted our flag. And we said, we're soda. And And we had also been seeing that with how consumers were repeat purchasing the products and the retention that we had. But it was really like our big coming out moment. When Pepsi approached you with such a, I mean, approached the company with such a huge offer, I mean, it must have just been mind blowing to imagine that that was going to be the outcome.

1:03:40Honestly, when you go through these things, a lot of people don't know is you spend over a year, you meet them. it's almost like a dating process it's not like they just give you an offer and like two days later you say yes let's do this and their motto which consistently is what we're still hearing is let poppy be poppy and i think as a founder one of your biggest fears going through that is that the brand will lose itself or it'll change like i have all those fears our consumers have all those fears and pepsi just i feel like the big strategics they've done it wrong before and they didn't want to do it wrong with Poppy.

1:04:14And so we just kind of like got that from them. And so it was stress. I've never felt sad, happy, stressed, excited, like all within the same day, multiple days in a row for weeks. Right. It's a toll. It does like a toll on your body. Definitely going through something like this. I'm curious, as you were building the business, right. In the early days, Because you were a couple, right? And a lot of times we've on this show, you know, if I've asked people, would you work with your partner? And there are different kinds of responses. But I would say and I work with my wife, but I would say a lot of people say I'll never work with my partner.

1:04:51I can't. You know, it's too complicated. I mean, were there ever moments where your business relationship created tension or do you think just your personalities are just naturally matched to make the business side work too? So early on when we were really early in mother beverage days and it was really hard with working multiple jobs, having a family, well, scaling a business. I remember I used to get really upset when Stephen wouldn't take time out of the day to get me flowers or why do I not get chocolate on Valentine's Day? And we finally sat down one day and it was just like we got to pick, right?

1:05:34Is it marriage, kids, or the business? and what do we like we this is killing us and I honestly at that moment we looked at each other and said our marriage is great we love each other we want to be partners let's focus on the kids in business and just know that we're good and once we kind of let go of that expectation a lot of the pressure went away so then when he did get me flowers it was extra special it wasn't because of a holiday and so that was really early on and just like understanding that it was okay and that just to show up where we could. And I wouldn't do it again without him. Yeah, absolutely.

1:06:12Would do it over again. I think the biggest thing about Allison and I think why we work is because we're 100 % committed at all times. It was really hard. Like I said, there was dark days. We didn't have money. We were technically unemployed. We weren't paying ourselves a salary. We didn't have health insurance. And I think that we've done the best that we could and still very much in love with Allison and very much excited to do this in the future together again. When you think about the journey you took, this really started in 2016, and here we are in 2025, and really started in 2020, rebranded.

1:06:55And it's been a massive success. I mean, how much of that and your journey do you attribute to the work and the grind? And how much do you think had to do with luck and timing and circumstances, people being open to this product today? Steven? Yeah, there's a quote that's always top of mind for me. The harder I work, the luckier I get. And so I really think it was a recipe that required all of it. Timing, luck, hard work, grit, passion, intensity. It required all of those elements. Yeah. And for me, I really struggle with saying it was luck because we worked really hard. I do think there were a lot of doors that opened that maybe a lot of people would say were really lucky, but I just know all the hard work that went into that.

1:07:47I think it was us knowing where to push, where to take the help, and kind of where to step back was a really big piece in allowing other people to come in and help, right? I think that it's a lot bigger, like Stephen said, of this once-in-a-lifetime generational brand. Not a lot of people can say that they created a product that our kids and grandkids are going to know as soda. And I just think that's just so much bigger and cooler than saying we got lucky.

1:08:24That's Allison and Stephen Ellsworth, the co-founders of Poppy. By the way, Allison is heading back to Shark Tank once again for its new season, but this time she'll be a shark. She's one of just two former contestants to ever appear in that role. The first one was also a guest on this show, Jamie Simenoff of Ring, which is a great episode, by the way. Hey, thanks so much for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show. And if you're interested in insights, ideas, and lessons from some of the world's greatest entrepreneurs, please sign up for my newsletter at GuyRoz.com or search for GuyRoz on Substack.

1:09:02This episode was produced by Ramel Wood with music composed by Ramteen Arablui. It was edited by Neva Grant with research help from Alex Chung. Our engineers were Patrick Murray and Jimmy Keely. Our production staff also includes Casey Herman, Chris Messini, Carrie Thompson, Catherine Seifer, Carla Estevez, Sam Paulson, Andrea Bruce, and Elaine Coates. I'm Guy Raz, and you've been listening to How I Built This.

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