Kom­bucha CEO says com­pany’s founders ‘were “suc­ceed at any cost” types of peo­ple’

The Fresno Bee (Sunday) - - Job Market - By Ron­ald D. White

Daina Trout is a co­founder and chief ex­ec­u­tive of HealthAde Kom­bucha in Tor­rance, con­sid­ered one of the dom­i­nant brands in the rapidly grow­ing global mar­ket for the fer­mented tea. Health-Ade was founded in 2012 by Trout, her hus­band, Justin, and her best friend, Vanessa Dew.

Justin Trout serves as chief op­er­at­ing of­fi­cer; Dew is chief sales of­fi­cer.

Health-Ade, which has grown to more than 200 em­ploy­ees, pro­duces 16 fla­vors of kom­bucha, which can be found in more than 26,000 stores. The com­pany is on track to sell more than 4 mil­lion cases in 2019.

HEALTH KICK

Daina Slekys dis­cov­ered her love of sci­ence dur­ing high school in Ply­mouth, Mass.

She stud­ied pre-med and health sci­ences at Ge­orge­town Uni­ver­sity and di­etet­ics at Sim­mons Uni­ver­sity, then ob­tained mas­ter’s de­grees from Tufts Uni­ver­sity in nu­tri­tional bio­chem­istry and pub­lic health.

She had been in­spired by an in­tern­ship with Artemis Si­mopou­los, one of the au­thors of “The Omega Diet.” “I re­ally fell in love with nu­tri­tion sci­ences and how it could have an im­pact on health. That was my en­try­way.”

FIRST CLUE

Trout still didn’t have any sense of how she was going to em­ploy this knowl­edge, but the first hint emerged dur­ing her time at Tufts, when she got hooked on cook­ing and fer­men­ta­tion. She even self-pub­lished a book, jok­ingly ti­tled “Some­one’s in the kitchen with Daina.”

She had be­gun drink­ing kom­bucha but found the fla­vor lack­ing in store-bought ver­sions of the pro­bi­otic drink.

“I learned how to make a re­ally good kom­bucha. Mine al­ways tasted bet­ter to me and my friends.”

L.A. BOUND

Tired of the East Coast’s cold weather, Daina and Justin headed for Los An­ge­les in 2007 with­out jobs. “I started look­ing for work but I re­ally had no in­ter­est in any­thing aca­demic. Di­eti­tian jobs just didn’t pay very much and I had home mort­gage worth of col­lege debt.” She wound up be­ing re­cruited for a sales job with British phar­ma­ceu­ti­cal gi­ant Glax­oSmithK­line.

On her first day, she was paired up with her fu­ture best friend Vanessa Dew.

PRAC­TICE GROUND

GSK put Trout in a po­si­tion in which she was work­ing with teams of em­ploy­ees to help them be­come more ef­fec­tive and “more en­gaged with the com­pany,” she said.

“I worked with over 300 teams. It was this un­be­liev­ably ro­bust case study on how teams work, which do well and on what types of lead­ers do those suc­cess­ful teams have. I was just a sponge soak­ing up all this in­for­ma­tion.”

UN­FUL­FILLED

But the job was only tem­po­rary and Trout found her­self back in sales. In two months, she quit. Justin was a strug­gling mu­si­cian who worked with a suc­cess­ful en­tre­pre­neur on the side and had the du­bi­ous dis­tinc­tion of de­posit­ing his rather large pay­checks. Dew was feel­ing unin­spired at GSK. The three brain­stormed on what type of busi­ness they might start. “The big­gest thing in our way was money. We had none,” Trout said.

MOD­EST BE­GIN­NING

Dew used her con­nec­tion to a friend with the Brent­wood Farm­ers Mar­ket to get the trio a try­out sell­ing Trout’s kom­bucha. “It was cheap to make. We had our first 60 cases of kom­bucha on March 25, 2012. The la­bels were some­thing we Scotch-taped onto the bot­tles. We couldn’t even buy la­bels. But we sold out in about an hour. The whole sum­mer went like that. We saw that there was a lot of de­mand for our kom­bucha.”

GREAT PART­NERS

From the start, the three meshed well. They pa­trolled the farm­ers mar­ket, giv­ing sam­ples. “We al­ready had trust and good com­mu­ni­ca­tion un­der our belts,” Trout said. “I think that was im­por­tant to have for a found­ing team. We didn’t have to de­velop that. And the three of us were in turbo mode. We were ‘suc­ceed at any cost’ types of peo­ple. We called it our tri­fecta. We were each equally ded­i­cated to win­ning. This was our chance to build some­thing great. We all quit our jobs, even though we had al­most no sav­ings.”

CARRY ON

The credit cards were maxed out, Trout said. Bank ac­counts were drained. Rel­a­tives were tapped for loans, “ev­ery­one on the fam­ily trees,” as Trout put it.

Her apart­ment neigh­bors were com­plain­ing about the smell of fer­ment­ing kom­bucha in sev­eral 2.5-gal­lon jars. Oth­ers com­plained about them run­ning a busi­ness from their apart­ment.

Even­tu­ally, it led to an evic­tion no­tice. “We were scared as heck, but we had an un­usual drive to work hard and achieve suc­cess. That got us through. We were so ded­i­cated to it. Then Cameron Diaz was in a photo hold­ing one of our kom­buchas. That was big for us.”

THE BIG BREAK

Health-Ade had a foothold in some small stores, but the goal was to get into one of the more prom­i­nent gro­cery chains.

Fi­nally, af­ter more than 10 tries, the trio got Erewhon Mar­ket to give them a lit­tle shelf space, in 2013. The Trouts and Dew were at the store all day, work­ing in shifts, hand­ing out sam­ples.

“We were not going to let this fail,” Trout said. “We knew that Erewhon had to be our story of suc­cess.”

THE CASH CRUNCH

“We didn’t have enough money to meet our de­mand,” Trout said. Their $50,000-limit credit card was shut down and banks weren’t in­ter­ested. That’s when they heard from First Bev­er­age Group, also in 2013. “They had been fol­low­ing the kom­bucha mar­ket. They were our first big in­vestor. One of their man­ag­ing part­ners tried us, saw my mo­bile phone on the bot­tle and called.”

THE DIS­TRI­BU­TION PROB­LEM

The three de­liv­ered prod­ucts us­ing their per­sonal cars un­til they could rent a re­frig­er­ated truck, which sucked up gaso­line in traf­fic jams.

“We also had a ton of park­ing tick­ets,” Trout said. They needed a dis­trib­u­tor, but the one they wanted wouldn’t agree un­less they signed with a big chain.

“‘If you get Gel­son’s, we’ll take you on,’” Trout said she was told.

In 2013, “I think even­tu­ally Gel­son’s took a meet­ing with us out of pity,” Trout joked. “They were told it wouldn’t work. Kom­bucha was too small a cat­e­gory. They al­ready had a kom­bucha prod­uct that was sell­ing well,” she said. “They gave us 16 weeks in eight stores. We did re­ally well. That was how we un­locked our dis­tri­bu­tion prob­lem. Once we had third-party dis­tri­bu­tion through Na­ture’s Best, we started getting into more stores across the West Coast. When we opened up with Whole Foods in 2014, that con­nected us to an­other dis­trib­u­tor. Now, we have 150 dis­trib­u­tors across the U.S.”

HEALTH-ADE, WHICH HAS GROWN TO MORE THAN 200 EM­PLOY­EES, PRO­DUCES 16 FLA­VORS OF KOM­BUCHA, WHICH CAN BE FOUND IN MORE THAN 26,000 STORES. THE COM­PANY IS ON TRACK TO SELL MORE THAN 4 MIL­LION CASES IN 2019.

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