INNOVATORS

Ontario entrepreneur Keith Harris turns a lack of processing capital into a virtue to allow his maple-sap beverage company to tap consumers

Keith Harris uses a lack of processing capital to his advantage in launching a line of maple sap drinks.

Capital investment is always an issue for startups. Canadian banks are considered risk averse and the country’s venture capital industry isn’t exactly robust, especially for someone in a fledgling market. But sometimes a lack of cash can be turned into an advantage, if only by necessity. Keith Harris, the founder and CEO of Troll Bridge Creek Inc., started the maker of KiKi Maple Sweet Water, a line of maple sap beverages, with about $80,000 in 2009. “I tried to interest some bigger players, but since we were the first to try to open this category and we were small, no one was more than politely interested,” he says. “Everyone took a wait-and-see position. Risk aversion was the name of the game.”

Harvesting maple sap is not cheap and it was going to be Harris’s biggest expense, so he decided to harvest a small quantity of fall sap, which is about half the strength of sap in the spring and rarely tapped in the industry. As a result, the Arthur, Ont.-based company was able to test market acceptance four months ahead of the typical spring harvest to gauge whether the risk of further investment was worth it. “Once we made the decision to move forward, we then put the harvest process in place to gather and store the raw sap until there was a market demand to process it,” Harris says. “This enabled us to delay processing costs until we had sales revenue coming in.”

As it turned out, the delay was worth the effort since it gave the company more market information about its product mix. The initial intention was to introduce one pure maple sap drink, but market surveys revealed that consumers were looking for more common flavours. Since the sap was in storage, Harris was able to adjust the product mix before launching full scale. He says the company processes throughout the year, rather than just in the spring, and the “produce on demand” system means cash flow is much easier to gauge.

Troll Bridge Creek is still small, but out of startup mode, and Harris has invested about $250,000 into the venture, which is starting to show results. Sales last year were four times 2013 sales and the company has introduced KiKi Maple Sweet Water to the Manhattan market, shipped container loads to Europe and Australia, and is negotiating with national distribution companies in Canada and three major national grocery chains in the U.S. It has even obtained approval from the South Korean Ministry of Food and Drug Safety and expects to be on shelves in that country this spring, and is getting interest from Brazil, Spain and China.

That’s not a bad start for someone who had zero experience in the food industry. Harris was a senior manager in the Ontario auto industry and wanted to do something a little less stressful. He initially wanted to provide a sustainable replacement for water since it seemed “ludicrous” to him that imported water products were on the increase as was the use of plastic bottles. “I am not from the beverage/food industry so I did not understand the beverage industry, but that did not stop me,” he says. “As it turned out, maple sap is much more than the cleanest water; it is one of the most refreshing functional beverages.”

It’s also an idea that several others have had and the Federation of Quebec Maple Syrup Producers in 2014 unveiled a certification process that certifies pure Canadian maple water that has been sterilized and contains no chemical preservatives or additives. Wahta Springs and SEVA are two popular brands that have been certified.

Like coconut water, which has gained popularity as a health drink, pure maple water is touted to be full of electrolytes, minerals and antioxidants, but has about 20 calories per serving or about half the calories of coconut water. KiKi Maple Sweet Water, which retails for about $2.60 per 300- ml bottle, has about 60 calories as it has maple sap, fruit juice, maple syrup and natural flavours, and comes in four flavours: maple, maple cranberry, maple blueberry and maple strawberry. “We expect the growth of our product to mimic the coconut story,” Harris says. “The journey has been interesting to say the least.”