Kara Goldin is a very big fan of Diet Coke. Correction: She used to be very big fan. Up until 2003, she drank 12 cans a day. But that all changed after she gave birth to her third child and started paying attention to beverage ingredient lists at grocery stores. “I was horrified by what existed in the market," remembers Goldin, a former AOL executive. "In my mind, everything had too much sugar and artificial sweeteners."
A fair amount of research led her to make a big decision: She would liquidate her home of sweetened drinks and start over, which meant saying no to her beloved Diet Coke forever. Her husband, Theo, teased her, saying there was no way she could do it, but (with difficulty) she proved him wrong. “My body went through major withdrawals,” she says. “I didn’t just get headaches, I got fevers, too. But after two weeks, I’d eliminated all artificial sweeteners in the house. I was totally committed and I expected my kids to be committed, too.”
Her family wasn’t exactly thrilled by the change, and Goldin soon found contraband soda cans tucked in corners of her home. In an effort to get her husband and children on board, she began flavoring pitchers of water with pieces of fruit. The result was so successful that friends started asking her where she got her new concoction. “I would laugh and tell them that I just made it at home,” Goldin says.
Word got around and soon Goldin was getting requests for orders. In 2004, she stopped by a Whole Foods near her home in San Francisco to ask what it would take to bring a product to market. “They told me that I would need a UPC code and the product would have to have shelf life to sell,” she recalls. Goldin went home and got to work. She launched the finished product the following year, naming her new company Hint Water (water with a “hint” of fruit flavor).
Since then, Goldin’s company has experienced tremendous growth. Hint Water is now sold in grocery stores nationwide, including Whole Foods and Kroger; 3,000 Starbucks locations, and is a top seller on Amazon. “We are also the most popular beverage at Google,” she says. “We have an employee who goes there to service 167 micro kitchens.”
OPEN Forum asked Goldin how she managed to get her product market ready, and about her mission to improve the health of others.
Your resume is pretty heavy in media and tech with stints at Time Warner, CNN and even as the head of e-commerce at AOL. Where is the beverage experience in there?
(Laughs) You aren’t going to find it because I didn’t have any beverage experience when I started Hint. I started it with $50,000 of my own money and when that ran out, I used my American Express card. I laugh about it now, but I couldn’t be more serious. That's how I went to market.
How did you know what to do?
Honestly? I would talk to anyone who would talk to me. I didn’t hire a consultant; I just called people. I was really appreciative of their time, even if I just caught them for 15 minutes.
Was shelf life a problem when you launched, seeing that you were using fresh fruit?
Oh, gosh, yes. I laugh at what our product was in the early days. Shelf life was a major challenge, mainly because we were adamant about not using preservatives. We wanted to cook the fruit but everyone said that using cooked fruit was really complicated and would never taste the same as fresh fruit. I think we believed that for a little too long.
One night Theo was up late playing with different temperatures on the stove and using our espresso machine to heat water. I remember him waking me up at 3 a.m. to tell me that he’d figured it out. It was amazing; he’d created a boiled down fruit essence. Because of him, we’ve been able to keep our product free of preservatives.
Grocery can be a tough market to crack. As a small company, how are you able to grow in such a competitive environment?
You are right that grocery is especially hard. It’s a chess game. There are more than 2,000 beverage companies in the U.S. and most people can only name 30. But you know what moved the needle for us? Amazon. A few years ago, they said they wanted to start a grocery division. We half-listened to them, but six months later our sales were through the roof. We woke up a few months ago and realized that our business had grown 200 percent on Amazon without putting any money into customer acquisition, advertising, email marketing or loyalty programs.
How do you account for your crazy sales growth online?
Millennials. They don’t like grocery shopping at all. It isn’t like when I was a kid and our family knew our grocery checkers. Today it is all about convenience. It also helps that a lot of millennials see us in their workplaces, like on Google campuses.
What’s next for Hint Water? Are you thinking about selling the company to a larger player in the beverage market?
We’ve had dialogue with multiple companies, but the challenge for any better-for-you beverage or food product selling to a company like Coke or Pepsi is that those are public companies that have responsibilities to their shareholders to sell core products. We think about helping consumers are little bit differently. For us it’s about health. When I ask customers about how they heard about us, a lot of them say that we were recommended to them during their pregnancy.
We have a lot of gastric bypass patients and cancer patients drinking our product. Chemotherapy can give you a metallic taste in your mouth; our product tastes good to them and it is healthy. Every day we get letters saying things like, “You helped me get through Stage IV Lymphoma.” It’s amazing.
What advice can you offer entrepreneurs just starting out?
You really have to love what you are going to do. I never set out start a company to make a billion dollars. I do this because I really believe that we are changing health in America.
Other advice would be to think of original ideas and work with people that you trust. I work with my husband every day. People ask me how I do it, but we are really different people with different skill sets. We admire each other’s abilities and encourage each other to think through issues and processes. If you can find a business partner like that, you will be just fine.
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Photos: Thinkstock, Hint Water