Poppi Beverage (pitched originally as "Mother Beverage") is a company by a husband and very pregnant wife team of entrepreneurs from Dallas, TX, attempting to bring a probiotic drink to the market that is more palatable than just taking a swig of apple cider vinegar but carries with it the same claimed health benefits.
The entrepreneurs started their presentation by passing out samples to the sharks who all tasted the drink and recoiled. Of course, that wasn't their beverage, they had been given shots of pure apple cider vinegar. What they had created was a "light and sparkling", low calorie drink that contains a tablespoon of apple cider vinegar inside each bottle but was easy an more enjoyable to drink.
Mother Beverage has created a range of flavors including lime-ginger, "raspberry-rose," pineapple-turmeric, and blueberry-sage. All of the flavors are unpasteurized to maintain the health effects of the apple cider vinegar.
Each bottle of the beverage costs between $0.78 and $0.85 to manufacture and retails for between $2.99 and $3.59 depending on the retailer's margin. While the entrepreneurs originally started selling at area farmer's markets, they are now currently in testing with Whole Foods in and around the Dallas-Fort Worth, Texas, area. Additionally, Mother Beverage have been picked up by two hundred Albertson stores.
Mother Beverage has been around for eighteen months and has grossed $500,000 in that time. The entrepreneurs project earning $1,000,000 by the end of the year.
In terms of previous fundraising, Mother Beverage raised $125,000 in a friends and family round that valued the business at $600,000.
This deal aired on Episode 10.08.
Making A Deal
All of the sharks expressed concern about the amount of marketing required to break into the beverage business, stating that it was likely the largest area of spending the company would have to do and that they didn't feel as if the entrepreneurs had done enough. Additionally, the sharks were dismayed by the fact that Mother Water doesn't use a co-packer and instead bottles their own product, in a plant that can produce 16,000 bottles a month. Only Rohan, who appeared in the episode as a guest shark was willing to make an offer based on his experience launching brands such as Smart Water.
Interestingly, Rohan stated that Mother Beverage actually stood a chance of being successful because the larger beverage companies did not innovate, leaving the market open to smaller entrepreneurs to find out what new drinks consumers might be interested in. Whether this means that they purchase the successful businesses or just clone them later if successful was unclear.
Because of the amount of marketing required to bring the beverage into mainstream, he stated that he would need 25% of the company to be involved and held firm even when the entrepreneurs attempted to push back and get him to accept a lower stake. This represented an enormous bite of $2,400,000 off of the original valuation but, in the end, the entrepreneurs acquired one of the most knowledgable people on the beverage industry out there as an investor.
When the entrepreneur originally appeared in the Shark Tank, she was extremely pregnant, as noted above. According to an update that Shark Tank aired in episode eighteen in Season Eleven, she gave birth just twelve days after her appearance.
Also, working with their partner shark Rohan, they also discovered that they couldn't trademark the "Mother" in Mother Beverage. Even though they did $1,000,000 in sales they re-branded as "Poppi Beverage" in order to get a trademarkable name. Supposedly the name was inspired because the product is low in sugar and full of benefits which... so is heroin...?
Previously, Mother/Poppi Beverage was in two hundred retail locations but is now in 1,000 including Whole Foods, Sprouts, and Lifetime Fitness.
Rohan claims in the same update that he doubled his investment with this company.
- The sharks all seemed to universally acknowledge that apple cider vinegar carries with it some kind of health benefit though it's doubtful any of them could name exactly what that benefit actually is. It may be beneficial, this site takes no stance on it either way, however no reliable or respected publication could be found through searching describing exactly what that benefit is or how much vinegar is necessary to consume in order to achieve it. Considering that Mark is quick to rightly call out supplement makers for their dubious claims, it's disappointing that he appears so quick to get on board with food and drink maker's claims about the health effects of their products. They need not present statistical findings in each pitch, just a rephrasing of the alleged "health benefits" as something "many people have described" as beneficial might make them sound less like snake oil salesmen. This was something the entrepreneur behind The Kombucha Shop from the fifth episode should be applauded for.
- The entrepreneurs stated that they were in the process of adding automation to the plant so that they could turn out 200,000 bottles a month which, at the very least, means that they were establishing themselves as a bottling plant if not an actual beverage company. They said that they preferred to bottle themselves instead of using a co-packer because they wanted to bottle their beverage "raw" to preserve the "health benefits"(see above).