Anthony Spina is the Co-founder and Co-CEO of System Seltzers, the first alcohol-by- volume system. Consumers can choose to purchase multipacks of eight, five, or zero ABV, giving buyers the choice to dial up or dial down over the course of an evening or week. Anthony is a veteran beverage brand executive who worked as a brand manager for Pabst Brewing Company, Mike’s Hard Lemonade, and White Claw before founding System Seltzers. Additionally, Anthony is the Founder of Three Degrees, a selective beverage branding company that includes beer, spirits, hard seltzer, and energy drinks.
Here’s a glimpse of what you’ll learn:
- Anthony Spina discusses his journey into consumer packaged goods
- The switch from old-school to new-school marketing
- Beer’s transition into the beverage industry
- How gender impacts beverage branding
- Anthony shares how he and his business partner came up with the idea for System Seltzers
- The future of cannabis
- Hard seltzer’s first trademark win
- How to start a new brand
In this episode…
The beverage industry has evolved heavily since the 1990s. At one point, while hanging at bars, the only options outside of hard liquor were beer, wine, and perhaps the novelty wine cooler. Gender norms also played a factor in what bargoers drank. Fast forward to the twenty-first century, alcoholic choices include craft beers, hard lemonades, and seltzers.
But what about the social drinkers who have work in the morning, are trying to cut back, or prefer to socialize sans alcohol? Those are no longer hard choices, thanks to beverage brand manager and entrepreneur Anthony Spina. Now consumers can choose to dial up or dial down. Want to learn more?
Join Steve Gaither in this episode of the CPG Troublemakers as he chats with the Co-founder and Co-CEO of System Seltzers, Anthony Spina. The two discuss the ever-changing beverage world, including how marketing has changed over the years, beer brands pivoting into the beverage industry, and the idea behind System Seltzers. If you’re a CPG professional who likes to stir up a little trouble, then you’ll want to tune in. Let’s get started!
Resources Mentioned in this episode
Sponsor for this episode…
This episode is brought to you by 1o8 Agency. At 1o8 Agency, we are a holistic digital marketing agency that cultivates brand growth through creativity and innovation. We jump right in to create solutions with measurable marketing intelligence.
The result? Our clients see increased engagement and increased e-commerce traffic, which equals more sales and profitability for our clients.
Welcome to the CPG. troublemakers. The place where brands and makers food and beverage nerds and investors all gather to cause a little bit of mischief. We welcome industry leaders, whitespace thinkers and channel partners to come together to turn problems into opportunities. Or, at the very least, have a little fun along the way.
Steve Gaither 0:11
Hello, I’m Steve Gaither, and welcome to the CPG Troublemakers where food and bev brands, investors, and service providers get together and cause, well, a little bit of trouble. Here’s my shameless plug. I’m EVP of growth and strategy for 1o8, a creative means commerce agency that focuses on brand strategy and package design as well as DTC and Amazon Marketing for the CPG industry. I have the pleasure of hanging out with the lovely and talented Anthony Spina, co-founder of System Seltzers. He was brand manager at Old Style when it became a thing again, he was brand manager at White Claw, which at the time was playing second fiddle to Mike’s Hard and he flipped the script on that one. Now he’s launched his own seltzer brand called System, the first inclusive drinking system. It bring his multi packs of eight, five and zero ABV so consumers can dial up or dial down over the course of an evening or a week. Anthony, welcome aboard my friend.
Anthony Spina 1:12
Wow. Well, what an introduction. I mean, first and foremost, thank you for having me. It’s an absolute honor. And, you know, I love love, love, love podcasts in general, just because it’s such a great way to have just candid, real conversations with equally as, you know, awesome people. And I want to give a shameless plug and say, Thank you for having me to the Windy City Troublemakers, even, you know, in person events, which I found me as someone who is kind of new to that ecosystem. Absolutely just a blast and beneficial remarkable and dare I say fun? And then also thank you to you for taking one of the greatest photos of 2022. or dare I say the entire world. So you know, I’m just I’m really throwing a lot at you right now. But
Steve Gaither 2:07
Well, the audience does not have the benefit of seeing the live screen here. But there is not only System but Riot Path, which is we’ll get into that story in a little bit. Which is Anthony’s visual arts now sitting on my credenza. All right, and they we could either go start today or start the past or we could do a momento thing where we go. But I think I want to know how the hell did you end up? You’ve got a branding pedigree? How did you find your way into a crawl your way to for example, Old Style? Like what?
Anthony Spina 2:46
Oh my gosh! Well, what one of my favorite things, you know, of all time, no matter who I’m talking to, in any way, shape, or regard is, you know, people’s origin stories, right? And, you know, kind of a question of, like, how did you get to hear, because beverage is one of those, those spaces that and that’s what kind of makes it beautiful is that it pulls people in from so many different places. And you’re some are kind of like, you know, traditional CPG trains. On the other side, myself, actually, I mean, I had no background and CPG and I actually, you know, kind of fell into it. And so I, you know, I went to school for sociology, actually. And so I, you know, when I was in school, I was, you know, working in like think tanks, and, you know, like, trend analysis type stuff. And really, I’ve always been enamored with how a brand or a product becomes something more and actually has a reason to exist from a cultural perspective. And so, you know, I, I ended up in Chicago and actually, you know, in Chicago is, gosh, we applied 2009 So I was actually working for Universal Music Group, running The Island Def Jam, record label promotions for the Midwest, and, you know, throwing parties at nights, you know, actually best party in United States 2009 Besides date myself a little bit debonair.
Steve Gaither 4:21
So you were a promoter? Come on. Wow, it does.
Anthony Spina 4:25
I was able to spend time with some of the best in the game. You know, Derrick Barry, who’s now you know, that did Save by the Max and let me just
Steve Gaither 4:35
could just Claudia and Steve with Debonair.
Anthony Spina 4:38
oh god, oh my god. I mean to two of the greatest, I mean, I still to this day. Yeah, it’s Claudius, Steve Zacchaeus MacKerricher, the whole the whole crew. And so, you know, at the time, so, you know, I knew that the Pabst Brewing Company and Red Bull basically had to have the most progressive with they were kind of calling like, feel Marketing and culture marketing, which is kind of an ambiguous term. But, you know, it’s something that I always looked up to because it was like, That’s it, like, that’s the moment where brands, they’re not trying to like suckle off the teat of cool, right? They’re not trying to, like, infuse themselves in places that they don’t need to be, you’re actually there and you have an infrastructure to support and be a catalyst for culture, you know, art, music culture. And so, you know, it was great, I got to, you know, meet some of the kind of Pabst team. And next thing I know, I ended up in the Pabst office used to be based in Woodridge, Illinois, actually ended up there, I was probably, you know, moderately a little tired from the night before, on skinny jeans, leather jacket, potentially a fedora, there’s always a fedora moment, by the way, every 10 every 10 years. It’s like, it’s cyclical, you can track it. I mean, you know, and it’s like, no one really admitted, you’re like, Have you ever worn a fedora? And you’re like, ah, you know, I’m unclear, right? But you’ve had a fedora at some point everyone has, but anyways, so yeah, was great. So that was the way that I, you know, I never been to a wholesaler, I had never, I mean, again, I pricing structure, I mean, you know, channel strategy, I didn’t know any of that kind of stuff. And, you know, I literally came up through the Pabst field and culture marketing program, which, you know, to this day, I mean, talk about a moment in time was, was just such a magical experience with such a great kind of brother and sisterhood of just like minded people who, frankly, some of us were like, unhireables, I mean, you know, we would never like be, you know, a part of a larger, more traditional CPG organization. So, I think that’s the cool thing is you have all these really uniquely plugged people all across the US with this commonality of you, and this is when Pabst was was starting to really go through the early seed stages of its resurgence. And, you know, we always kind of have this unspoken vibe that, you know, was to shepherd and protect the brand, I mean, that because it was more than a brand and meant something. So that was really the foundations, and then being able to, you know, shift over into, you know, sales, and then, you know, the Crash Course, and sales, you know, for a short period of time, but really helped and then into brand management for old style. And, you know, that was one of those moments where, I mean, old style been declining for 20 plus years, and, you know, something that there’s a lot of traditional marketing approaches that were taken with the brand over the years. And again, it was one of those, like, look, let’s do some things that maybe haven’t been done. And let’s really do a calculated approach of, you know, building community around something that, frankly, is beautiful. It just needed to kind of be reengaged by an entire new generation. So yeah, I was able to turn oldstyle positive on two years, which was something super proud of and the team behind it to me that was were without the sales team, the wholesaler team. I mean, it’s just, you know, this stuff doesn’t happen in silos.
Steve Gaither 8:15
Well, I was looking at the advocates of field marketing was like Kba, Kevin Berg and Mike bladder when they came up with the whole idea of the bar napkin for camo right? What does Mr. need they need a bar napkin, let’s take the camera logo on and start to infiltrate and integrate the on premise programs are really got that culture? How did you really tie field marketing into old style? And when did you see that, that switch between old school brand Chicago scientists to all of a sudden new school? Right?
Anthony Spina 8:46
Yeah, well, you know, this is when you really deconstruct the old style brand. What’s really important to note and why this was such a kind of hard challenge to crack is that you have a brand that everybody knows, essentially, right? I mean, it’s it’s there, but old cell really hit its peak, like in the 80s. So it, it caught that generation. Right. And so I mean, at one point, oldstyle I believe outsold, like, you know, Anheuser Busch, and like, you know, all their brands. And again, this isn’t the 80s Right? So when you don’t continue to reconnect to this, and the hardest thing from a brand perspective is you know, with each subsequent generation, you just kind of have your, your loyal coin base, just age essentially, you know, which again, is a natural progression. So you take something, and then you say, okay, great, well, it’s got gold in the name, and I think this was the big piece is you don’t need to make something new, especially when it’s classic. And so that was the big word is that this is classic, right? This is something that that you can’t buy because it’s intertwined into the fabric of, you know, the Midwest. So then stripping that down, I’ll never forget those damn Q was the CMO at the time. And, you know, he used to, it was very, very simple. But it really, really stood out to me. And it was, okay, great. How do you describe, you know, you pick any brands? Three words, what does it sum it up? Right? No such thing as boardroom and it doesn’t. I mean, it wasn’t sitting in rooms like this that often, you know, as you’re sitting there, and you have the entire essentially, like, leadership team and you went around the room, it was like three words, what is old style? Right? And nobody, you know, you’re like, ah, you know, it’s kind of like, well, you know, that and it’s like, don’t know, keep a little bit next. And probably like, Jesus, that spin I flew from Chicago was alright, good. He was old stone. So what you know, like, well, you know, just iconic, classic, and just, it’s all done. We’re not leaving this room. So we figure this out, right? I mean, you three words, right, that nobody else can really can really hang their hat on. And this is the piece of your neighborhood beer. It sounds so simple. I mean, real basic, right. But these three words, and again, this is where the power of simplicity, but also something that can be translated to, you know, much deeper, and then you’re not to get too heavy with all this stuff. But there really is a lot of thought put into it. And this concept of your right where you’re like, Yeah, that’s right. This is ours. You know, I mean, you’re, you can’t get this across the country, this is something you can only get in the Midwest. So this is this is ours, right? neighborhood. The big thing, it’s like, look, I mean, you have these hanging signs, I mean, Chicago is a city of neighborhoods, you don’t have that in other parts of the country. And then beer, don’t forget them. And you got and funny, you know, I can reflect back, it was a predecessor, where it’s like, the beer industry is no longer the beer industry in 2022, or 2023. It’s the beverage industry, don’t get confused where it’s going. I mean, like, that’s where beer has now evolved to be total beverage essentially. So this whole thing of your neighborhood beer, so then you start to take a look and say, okay, great, you know, what, what makes up the neighborhoods, what makes up the community, who are the groups that, you know, are really, really moving, and then putting programs and things together that, that supports, and are there at tangible ground level. And, you know, so it’s not almost like above the line, we used to do a bunch of radio and TV and billboards, and you’re like, No, you build it from the ground up. So it was really, it was a special special moment, and then you know, so throwing in a little bit of, you know, a lot at the time was starting to kind of, you know, have some little, little seedlings. And also, it’s like, keep your ear to the ground. And that’s the whole thing was like, this stuff happens in street level, by the time that you can get the insight and analysis of whatever data and data is important to validate, you know, so you’re not just totally, you know, it’s a gut check. But the real things happen at street level, you keep your ear to the ground, the further you get away from that, which is challenging, because, again, the higher you get, you’re working in offices or wherever you’re maybe not out all the time, you know, so you really take these things that are happening, and just naturally, it’s a natural progression. So, you know, watching the Chicago handshake, you know, really take on a life of its own was something that was really, really magical too, because, you know, again, the Lord was he was having this kind of Renaissance, as well, as you know, and he also going back to the, one of the biggest things that we’re really proud of, for the team is that going back to the classic can, which actually, you can still get old style, which is that’s, you know, the biggest thing, you know, really good marketing or, you know, brand, or identity kind of shifted, frankly, last more than three years. So, you know, when you go to buy old style beer right now, you know, it is that classic and iconic. Whites can from the mid 70s, that from a generational perspective, if you’re a millennial, you know or younger, you remember that because that most likely was your dad or your grandfather’s, but it was part of the world around you that you may not even know. So,
Steve Gaither 14:24
I like that too. I mean, it’s the whole Malcolm Gladwell, there’s, there’s with outliers, there’s a few things going on, but then you also had this serendipity moment of micro peers sort of being overtaken by macro at the time, right and he just jumped on those headwinds.
Anthony Spina 14:41
Oh to one and that’s yielding to what’s so beautiful about all this is that timing right and positioning and frankly a little bit of luck and Right Place Right Time is everything if you can, you know, read those rooms and let’s you know, the rooms being street level, if you can read what’s happening in real time. And you know, really have a reason to exist. And that’s the most brutal piece of, frankly, beverage and any CPG brand right now is like, if you’re here tomorrow wouldn’t even matter. We’re able to give a shit. And you’re like, Whoa, I mean, that’s as real as it gets, you know, like, what role do you play, if any? Like, why why are you here? So it’s, it’s very real.
Steve Gaither 15:23
Let’s speak in a right place. Right. So I’m us somehow made a shift to the the Marc Anthony world, and I joked about it earlier. But the redheaded stepchild of Marc Anthony was sort of white clouds at time, Mike’s Hard was the big mama Jama. Oh, talk to me about that.
Anthony Spina 15:44
Ah, well, you know, and one of the other things, what actually ended up kind of bringing me over to Marc Anthony group was, he has a lot of former paps colleagues, that were over there, you know, really at the helm of this and you know, you’ve Sanjeev Kandra Wallah, Justin Kelly, I mean, just this, this remarkable team that, you know, really this this mixture of insights and data. I mean, if it’s something that, I mean, Sonic Sanjeeva is just remarkable. And same thing with Justin Kelly. I mean, Phil, I mean, Anthony, by Mandel, I mean, the whole the whole group, but, you know, what was so remarkable to watch, you know, that whole experience? I mean, I think about right now, like, yeah, hard seltzers didn’t exist, literally did not exist, essentially, six years ago. And, you know, I remember, I mean, you’re gonna Mark Anthony brands has been around. I mean, Mike’s Hard Lemonade just turned 21. I mean, that, you know, 21 years old, it has, you know, 21st birthday this year. And so, you will thing where I mean, that’s been the flagship, and you remember writing writing decks? What is a hard seltzer? as wild as that sounds? I mean, literally, and explaining it. And you see, these things were like, well, yeah, hard. Seltzer everyone knows it. But at a point in time, it was kind of like, Ah, I don’t know, you know, you’re sure. Is this gonna be a fad? Or like, yeah, that was always the piece tonight. Oh, my God, how big canvas get and you’re like, just to be clear, it’s like, hard seltzers are dancing around 10% of the total beer category, which is remarkable. I mean, just to think about that for a second. But the big thing, I mean, the big thing with White Claw. And this is, you know, you look at the difference between White Claw versus some of the other kind of, you know, players in the space. And it was this this piece of, I mean, genuinely being a lifestyle, culture and consumer driven brands. And also, you know, again, gender, too. I mean, I think there’s a lot of people at the time, you would have looked at all the data in the world that would have said, Yeah, great. This is going to be for females, right? Because that’s kind of historically who wine coolers were for SMBs. And that was the big piece is like, No, this is male and female.
It’s pretty much 50/50 split across the board. Right? Yeah.
I mean, and that’s what’s really powerful about that is because, you know, again, not to back too far out, but you know, you look at the drivers of what, you know, why you say, okay, great, hard, seltzer. Why? It’s the taste, is it, you know, what is it? And I think, you know, some of the bigger drivers from the zeitgeist perspective are, you know, well, first and foremost is, is flavor. I mean, you have a generation that is, that is ready and willing, and a lot of that you look at the second wave of craft, beer, and Gone are the days where, you know, it’s just just beer is beer. I mean, it’s not like that anymore. And so you have a generation that their palate is ready for flavor. The other piece too, which I think is really, really important, when you look at kind of shifting gender norms, specifically amongst males, where you have the 90s and the early, early aughts. You know, where you want, no one wanted to be an outlier. You wanted to be one of the guys, right? Like, you know, if you walk in with the anything other than, you know, Bud Light, or Miller Light or whatever, it’s, it’s, it’s weird, frankly, I mean, you’re just kind of like, oh, you’re the odd person out, right? At least for when I went to school. You know, it’s one of those where you like, people weren’t just sipping on craft beers necessarily. PB PBR, and, you know, Mickey’s or whatever. But so, you know, that’s the funny thing is that you have now this, what we’re basically where it’s okay for men to, you know, try different things, bring interesting new things to the table. And also, you’re this kind of gender neutrality piece to where you know, it’s it is no longer male drinks or female drinks. And that was always the big I think, Miss from a lot of the Other early kind of players was like, it has to be male or female, this concept of kind of like gender neutrality is really important. And then also listening to consumers. I mean, and just being being a shepherd being a catalyst, and that’s always the big piece is having a role to play in culture. And again, a lot of times, you know, culture will adopt you if, if you’re, you know, honored enough and lucky enough from a brand perspective, so you have to treat it as such, in my personal and professional opinion, it’s something that, you know, is to be cherished and protected to.
Steve Gaither 20:36
Alright, so somewhere along the way, you became insane. And decided, hey, let’s start a seltzer company. Right, this is never been done. There’s none out there at this point. And so talk to me about that, that that moment of, of insane clarity.
Anthony Spina 20:54
Oh, well, yeah. Yeah. I mean, you have to kind of be insane, you know, right off the bat, just in general to be in beverage, right. I mean, this, this is one of the, you know, wildest industries, there’s, you know, who knows what could happen, you know, you’re dealing with things every day. So yeah, you know, you’re already half totally lost your mind. So, here was the big moment. And this was, this was this piece that when you think about beverage, and drinking and consumption, and, you know, you start to see, and there’s a lot of early chatter, about how like, Gen Z is not drinking, and all this kind of stuff, beer is dying. And, you know, it’s kind of it’s very kind of sensationalized. But, but it is true is that, you know, Gen Z is drinking difference. And it’s the way and the, the velocity that they’re consuming alcohol. And you’re, I mean, it’s actually the me, the US is kind of an outlier in the way that we actually drink is interesting. I, you know, through some of these little data pieces, as we’re like, basically, just trying to make sure we haven’t totally lost their damn minds, is, you know, the pieces like, oh, okay, so according to, you know, Pew data, the heights of us binge drinking, you know, binge drinking being, like more than four drinks during an occasion, like, that’s binge drinking, and you’re like, Oh, my, okay, good to know, you know, but, you know, what was 1998 to 2002. And I was like, Oh, when I was in high school, got it. So that’s why college let you know, in subsequent, you know, 20s and 30s. And so it’s interesting to see that you don’t, drinking as a whole has never really changed. I mean, since the onset of drinking alcohol, and I always think about this where it’s like, okay, as someone who’s never drank before and say, Take me through a night, right? They are 25 and below, so take me through a night of drinking for you to go, Yeah, sure. We all start out drinking alcohol, whether it’s beer, you know, Seltzer, whatever may be a standard 5%, most likely. And then we continue to have various mixtures of drinks until we decide that we’ve had enough for we faceplant into our bed or whatever it is that we do, right. And so you’re like, so you’re socialized into just like consuming alcohol in one speed. So this thought of, you know, then saying, well, alcohol includes everybody. And you’re like, you know, what, if I told you that alcohol has actually been XClusive, since the beginning, and you’re like, What do you mean, you’re like, Well, if you’re not drinking alcohol, you’re not included? It’s as simple as that. I mean, and that’s, and that has shifted, I mean, rapidly within the last two years, but that’s what’s so wild. We’re really kind of like concepting, this, it was the whole piece that, you know, alcohol was always associated with fun. And if you weren’t drinking, you weren’t having fun. And it was really hard, because you’re like, What if you get it for whatever reason, you don’t want to drink that night, or you hadn’t had like a story or this whole piece? So we said, Well, wait a second. What if, instead of different flavors, it was different ABV, a 0%, of 5% and an 8%. But with the same flavor, continuity, throughout all three, so that way, first and foremost, it was something for everyone where you’re like, oh, great, you know, everybody’s included, right? If you want a standard 5% You’re, you’re good to go. Hey, if you want to go after it, you got an 8% There’s something for you. Hey, but also if you’re just kicking it, get to 0%. And that was like okay, well, how is nobody put this into like a variety pack. And, again, it seems so simple, but it’s just been remarkable to see the mind people’s minds kind of you know, especially in the early phase Is is, uh, you know, explaining this to people need to wait so so you can everybody has their own kind of like use case like so you could print the zero like in between, or it’s like, what you could mix with it or, or wait so you could like drink a five and then drink an eight and drink a zero and you’re like, I mean, again, the possibilities are endless. But he was just one of those things. Yeah,
Steve Gaither 25:26
you bring up a good point. I mean, I remember I’ve been sober for a show here. So na to me meant O’douls, right, which everybody had a flag. I’m alcoholic, I got a DUI No, I’m drinking it Oh, rules that was that one na started to get a push a lot of people overcompensated and thought everybody was sober. So we’re curious. It was all or nothing and when I met you, and then I actually timed that with dads weekend with my son at IU. And saw how they, you know, started off pre partying with eights and then would dial down a little bit or mellow out was five, maybe dial up and dial out over the course that night on it started hit, I’m about to hit the point of wobbly, let’s dial down to a zero or drink something non alcoholic. So this wasn’t so much Hey, I’m drinking today. I’m not drinking tomorrow, which happens. But it was dialing up and dialing down over the course of the night, which I never experienced that until you and I sort of chatted.
Anthony Spina 26:30
Right? What No. And so, you know, that’s the other kind of, there’s two kind of underlying pieces to this. And one is one is just that is that this kind of mindset of like all or nothing, right? Where it’s like, look, I’m either, you know, either drink, and I’m a drinker, or I don’t drink and historically, you know, if you’re not drinking, you needed a reason, or people will be like, Hey, are you okay? Is everything good? Like, was there? Did something happen? Are you? Are you sick? Or you know, are you getting? Did you know, you have an alcohol problem? Or and for women, it was always like, Oh, are you pregnant? You know, or is it some medication or something? And you have this all or nothing mindset? And so sometimes, you know, the seemingly most simple things was almost like how we were like, how was nobody ever done this. And we were like, if we Ryan’s and it was kind of like, look, we see a reason for this to exist in the world. And so it’s almost like, you know, those things where you like, if you just position it and put it somewhere, people will figure out what to do with it, right. And that’s what’s been one of the most rewarding things is, you know, we don’t tell people what to do with this, right? It’s like this, if you give a mouse a cookie type thing where you like, three different ABVS. And then the other thing that’s really really important all this too, is that you spent a lot of time working on the branding and the identity and you know, so these, these three cans, they of course have the massive call outs of the ABV on them. So there’s no confusion of what the alcohol percentage that’s very important to us. You know, but the other piece was that to have different shades of gray scale so that, you know, no one, what you’re actually buying to a certain extent, or or gauging in is, is genuinely inclusivity where no one’s like, tracking your drinking. And I always kind of say that, you know, no one’s like, hey, you know, I noticed after watching the last couple hours you I noticed you’ve had four zero percents? Are you gonna be engaging with alcohol at any point tonight? I mean, like, there’ll be so you know, it’s like, well, yes, my calories too. I mean, like, what’s, so this whole thing where it’s like you can if you’re not drinking, and also even for myself, I mean, honestly, at times, you know, it’s like, I’ll, I’ll, I found myself fluctuating between drinking and not drinking, it was always so awkward, because like, what do you what do you have in your hand if you’re not drinking, right? Like,
Steve Gaither 28:58
especially the promoter mindset, I remember doing shots, a diet, diet coke, you know?
Anthony Spina 29:03
Totally, and this whole thing where it’s like, you know, hey, let me get a vodka tonic, but hold the vodka and you feel like you’re an impostor. It’s weird. And so with this, if you’re still a part of the group, right? And again, no one, it’s no one’s business and you’re drinking, you’re not drinking, right? But it takes away the anxiety, dare I say, and, you know, the planning of being like, how, you know, what’s, what’s my story going to be when people are like, Why aren’t you drinking? So it just it alleviates that and then the other piece too, is that really, really, really proud of the liquid. So Randy Hughes, former brewmaster of City Brewing for 40 plus years. I mean, he hand wrote this, I mean, he he’s been a hero and a mentor. And you know, that was the thing where Kim and I got to know each other when we brought oldstyle back to the original G Holman brewery in lacrosse, which is City Brewing. And you don’t need to watch Randy. I mean, this is a labor of love for him. I mean, he is he is a part of the of the group and the team. I mean, you know, you know For ownership as well, I mean, like, this is what I was like, really this is I want this to be something that is, is meaningful. You know, this is not just like, Hey, make something in a lab like this is built to be, you know, really special. And then also, you know, having an electrolyte component as well, you know, something that, you know, doing that. And, you know, the other piece that that is really, really important is shifting mindset a little bit, just how you know, and not being so burnt with it. But how we drink and more importantly, when you talk about total beverage, is that what if that zero wasn’t just a zero. There’s other players on the field right now. So this is literally the first Native total beverage system. This is built for the future. We have a CBD and terpene mix that is absolutely phenomenal that we’ll be launching in q2 of this year. We have, you know, of course, when we’re illegal THC infused at some point, which will be an r&d, you know, and again, as we start to look at, you know, these nootropics, or these other kind of spaces, to really have something that that that can be a part of it without, you know, it’s not like Bud Lights, CBD, you know, Na, right? And so it’s like, no, there’s a place to exist for all these future leaning things. And hence why the organization is literally called for what’s next ink. And this is all about the future.
Steve Gaither 31:34
Well, going back to that, too. I mean, you’re a brilliant guy, don’t get me wrong, but talk to there’s a lot of founders hopefully could have been listening to this. The old idea of two wrongs don’t make a right, you didn’t start off with his brilliant idea. Oh, all inclusive. Tell me where it started? And how the brilliant idea?
Anthony Spina 31:54
Oh, my gosh, no, no, thank you. And as you give me too much credit, right. I mean, I’m just, you know, lucky, I could just function on my day to day basis. But, you know, that that is always, you know, the biggest piece and, you know, as a first time entrepreneur, I mean, I think, you know, you go back and forth, because again, like your your names on this. I mean, this is a part of you, you have you have everything on the line, like as real as it gets, right. I mean, public, I mean, this is it, right. And so, you know, you do kind of get into this, like, perfectionist, you know, mentality. And so, you know, the origin story of this is we actually launched this brand as primer, your base coat of hydration was the piece and so this whole thing. And
Steve Gaither 32:42
it was electrolyte, electrolyte, you thought it was the ankle, right? Totally.
Anthony Spina 32:45
Yep. And that, and then yeah, it was kind of this. There was there’s, you know, a multitude of layers for you. So we knew that other people would come would figure out the electrolyte thing, right, me and happy dad, right. There we go. Makes sense. And, you know, it’s kind of separate, you know, speed that like, this whole piece. And, you know, one of the things that you really look at is, you do everything right, that you try your best, right, and you want to make sure that everything’s buttoned up. We had a random cease and desist. By some small brewery out of nowhere, you know, that basically was like, I mean, it’s one of the most aggressive cease and desist I’ve ever experienced. And I mean, it’s like, Oh, my God, you know, like, well, this is, you know, we did everything that we, you know, thought was right, you know, and this and that. And finally, you know, we really took a step back, and it was like, you know, what, the foundation of this, it’s not primer. It actually, it’s the first inclusive drinking system, trademark, which we already had. And so is the natural progression. And, you know, when you I mean, I mean, it was not easy. I mean, we literally, I mean, this happened six weeks after we launched. So, imagine that, you got articles out there, you got everything, you’re in the market six weeks. I mean, yeah, I mean, I’m talking like an aggressive season. So it’s like, where it’s like, Oh, my God, I mean, you know, they’re very, I mean, very aggressive. And it’s like, whoa, we got to pause. We can’t use our social media. We can’t, you know, I mean, like, we don’t know. You don’t mean, the stuffs in wholesaler warehouses? It’s the market. I mean, and so that’s where, you know, thank you for coming out, you know, to our wholesale partners to all of our retailers, I mean to everybody we said we you know, we had to make that call and we said look, if you really think you got it, you really think you know, you’re good at what you do or you’re just crazy enough. Do it pull the band aid off, change the entire brand from websites, social media, and go for it and one of the most I mean, I mean it’s not even you know, your your boo strapping this right? I mean, you don’t have the budget for this. You don’t have the time for this. This came out of left field, right? So the biggest thing is, you know, we did it, we pulled everything out of the wholesaler warehouses. Thank you to pilot project good city. I mean, like, you know, again, our friends, hey, we’re in the 70s. And that’s the, you know, you’re talking about community, right? So, you know, like, we got to re sticker the I mean, you know, we’re gonna be sleeve on the mean, so listen, hey, look fine, you can come and use our facility and we’re doing 18 hour day back, right. And we did it. We took a hard packaging, free fresh, I mean, you know, put it back in and we actually there was seltzer land, which was like this big, you know, seltzer Festival, where they basically dump you know, like, White Claw visie truly often in a, in a room, essentially, you know, hundreds of people and they vote for you know, the best hard seltzer right, which I’m not usually not one for like voting and stuff like that. But so we technically launched system, no website, no Instagram, no social media. I mean, literally was like, systems here, like Game on. And we actually ended up winning Best Hard seltzer. And then best non hard Seltzer, which was basically like spirit based or, and it’s like, we went both. And it was one of the most, you know, those moments where you’re like, Okay, we haven’t lost our mind. This means something to people, people loved it. Oh, system. So it’s like a drinking, you know, because the problem with primers would be like, your primary, it’s your basecoat. hydration? Well, and then it’s part of this bigger kind of drinking system where there’s 3 billion years like, whoa, you know, it’s like, you know, the joke is like, you’d need a Rosetta Stone to basically understand this, right? I mean, and so, you know, I’m always a big believer, again, of like, if you give a mouse a cookie, people will figure it out, but you gotta lead them to water. And so with the system, you get system, and then more importantly, you know, again, this, what if, you know, again, the 0% had other things in the future. So it really is at its core, a total beverage system? So, you know, it’s wild. I mean, I mean, I mean, it was not easy. I mean, it was it was as real as it gets. I mean, you know, you have to get new secondary packaging, or your glue and stuff. I mean, it just the operation components alone. But then I mean, you know, it’s, it’s real and having to go back to all the retailers. It’s kind of like, whoa, like, what you got your brand new brands, you know, and so, yeah, and, you know, honestly, it’s actually the first time I’ve ever talked about that, because at first we were like, do we, you know, I mean? Not that we were embarrassed, but we know it’s like we we tried to do everything right, you know, and it’s just kind of like pan. And now in retrospect, it was one of the greatest things that could have happened. And also it shows where it’s like, look, we’re here to stay. like nothing’s taken.
Steve Gaither 37:46
Told you from third party. I thought it was a strategic decision. Hey, primers where we started Hey, IT systems better. Let’s go. I just found out recently. Well,
Anthony Spina 37:57
well, thank you. Thank you. Yeah, one and the great thing is that our current IP portfolio you know, we are we are going out every time like the first inclusive drinking system. Trademark, the first non alcoholic hard seltzer trademark themselves or trademark. Yeah, it’s like we’re good registered, actually. So thank you.
Steve Gaither 38:13
Well, I want to get to channel strategy. But right before that, too, it’s a tough time for emerging brands, right? Debts really expensive. A lot of private equity VC family offices are holding to their wallets, if they do have a fun, they’re reserving that capital for follow on. How are you paying the bills to get from here to there? Because it’s expensive endeavor, especially in the liquor industry?
Anthony Spina 38:38
Oh, my, well, it first and foremost, I mean, you know, talk about being capital, you know, early stage capital intensive, I mean, beverage is as real as he has, I mean, even even someone you know, again, coming from a joke, a misspent youth, you know, in, you know, non beverage background, too, I guess not technically a beverage background. But, you know, I mean, I the amount of things that you don’t necessarily eat, I mean, just the minutiae of the state legal, all the licensure all the I mean, just just the, the operational components, I mean, all all the things right, I mean, spoiler alert, you know, cogs are going to be not, you know, favorable, because when you’re buying 5000 secondary cartons versus, you know, 50,000 I mean, it’s, it’s night and day. And then just all the considerations, so, you know, and the thing too, is that, you know, what everyone kind of told me early on, is they’re like, Yeah, your seed round is going to be the hardest because, you know, it’s a whole different story when they’re like, Yeah, great. You got a million you know, million dollar reoccurring revenue. You know, there’s option A, B and C but when you’re like, Yeah, you know, we’re we have, we think is a really great idea. People are buying it, you know, it’s moving but you just don’t have those historic Recall numbers. And you know, it’s hard to really engage with VC and private equity because they’re just, they’re not playing in those spaces. So that’s where one of the things, you know, was, was reg CF. And this, you know, the we funders, the seed, or the start engine, the seed invest all these things that, you know, at first I was kind of like, you know, it’s kind of like, any good deal isn’t someone gonna kind of come and scoop this up type thing? Right? And that’s where, you know, we really took a hard look. And what we started to find is that, you know, as broadened out, you know, people would be like, wow, like, really cool. Are you looking for investors? You don’t you’re like, actually, you know, we heard that. But then it’s like, great. Are you an accredited investor? Right? And it’s like, well, no, and then you’re like, okay, so by, by having these these platforms, I mean, it really, it’s a game changer. To be honest,
Steve Gaither 40:55
it’s cool to because we follow a senator, even though you have a hand chunk of people coming in, they’re coming across is one person on the captain.
Anthony Spina 41:05
And that is not true with all of them, by the way. So that was, so we chose start engine for that. And, you know, I always say anybody out there listening, got a great relationship with startengine, then send me a personal email, I introduce you to our guy, he’s been phenomenal. And so you know, we, we looked at all the different ones. And that was the big pieces that that rolls up into one line item on the captain because you’re thinking series A and other things down the road, if you have, you know, 100 people on the cap table, then spend more money cleaning that up. I mean, you know, it’s like, Oh, my God. So, you know, that was the nice thing. Is it also the other thing with fundraising, too, and by no means am I an expert, but get the right people, it is paramount to find those that are going to be, you know, value add, they’re going to be a part of the squad, they’re going to be a part of the team, you know, they are the patient capital, as well. And I think that’s the other piece, you know, you’ll start seeing people like, yeah, great, when are you going to exit this and those type conversations and you’re, like, look, you’re working towards your goals of growing this in effective and steady way. That I mean, you know, you’re positioning where, you know, you do have a exit strategy and plan, but, you know, really making sure that those those core investors and team, it makes everything. So, you know, very, very lucky to have, you know, again, some of my personal and professional mentors and heroes, you know, as not only, you know, advisors and part of the squad, but also as investors as well. And, you know, that’s also part of the motivation, in all seriousness, where it’s like, look, you know, you’re you’re doing this, because, yes, there’s a bigger vision, but you’ve got your whole team and squad behind you, you can’t fail. It’s like a wedding and say, Well, what if it rains on your wedding and you’re like, great, well, then we’ll just go find a, you know, an awning and go hang out with my best friends and family and squad. I mean, you know, again, when you’re, when you’re surrounded by the Dream Team, you can’t lose, you just have to shimmy and shake and, you know, keep moving.
Steve Gaither 43:16
Now, the path to market, you’ve got 350 million beer distributors, you’ve got retail, you’ve got three tier being broken down with EECOM and your Cocoa Puffs, and some people are actually breaking down DTC. How are you playing that game today? Because it’s all conserve
Anthony Spina 43:39
you know, this, this is how fast beverage is, is evolving to and this was, you know, again, the other I mean, kind of the, the core driver of, of system is that, you know, again, this, you know, looking at the lines between elk and non elk, which historically were you could not cross those lines, right. I mean, those were two separate things. That is literally changing right before our eyes, and they get I bought an alcoholic Mountain Dew this week. And I was like, Whoa, I mean, they’re, you know, I ordered an alcoholic fresca often go puff. And it’s like, I mean, you know, if you were to said five years ago, and again, hey, I’m a, I’m a believer in you know, I love ideas. And it’s like, you know, hey, don’t tell me anything’s impossible. So what I’ve been like, yeah, there’s gonna be alcoholic versions of like Pepsi Cola, and Coca Cola products in the future. I’d be like, good luck crossing those lines. I mean, that is a hard stance, but that has now shifted, and so. So at the playing field, frankly, and so, you know, historically, you’d say, okay, great. We, it’s pretty simple. You build out your wholesaler network, right, which I mean, even then, is a whole separate task. I mean, that’s, that’s a whole separate set of considerations. You know, we’re very thankful to have great wholesaler partners. You know, but the other thing too is that, I guess, luck larger prospective use. Okay, great. So where do you go? Where do you even start? Do you high spot the high indexing hard seltzer markets and like, cool, just like everybody else? And also good luck. I mean, you could literally burn capital trying to launch. You know, I mean, talk about setting money on fire. I mean, you could burn through $5 million in the blink of an eye trying to launch in three markets for a new brand. So, you know, our biggest strategy was, well, first and foremost is you know, we’re here in the Midwest, right? Oh, yeah. Cago Waukee. And so, you know, let’s, let’s go deep in our home markets. And also, because these are one of the last stalwarts of like, heavy drinking. I mean, like, the Midwest still still drinks pretty heavily. I mean, they get, you know, again, you go to the coasts, and it’s like a whole different ballgame, and things trickle down. So it’s like, look, instead of starting in the easiest or perceived easiest, starting the hardest, go when at the place, see if this really has legs. And also that’s the other thing. It’s like, when you have to be real with yourself, and you’re a brutalist and you’re like, Look, you think that says likes, go launch in Chicago, and see if people get it. Right. And that’s what’s been really cool. And so, you know, what we did is we took a look, and we said, great, you know, especially with limited capital and limited resources, you know, you’re rubbing two pennies together to get a quarter, which is what we’re used to. And that’s really all we know how, and actually, it makes it more fun. So you know, you’re not just like, Oh, where do I spend my money today? You’re like, oh, no, what’s going to be like, what’s the game changer that nobody else can do. And so starting, you know, again, going deep in the States, but then also, you know, we’re very proud that we’ll be, you know, launching in the first week of January EECOM. So we’ll be able to ship the 45 States through our partners at our Taproom. So that’s and also same day delivery in New York. And then same day delivery in LA. And cute too. So that way, and then also we have our great partner go puff. You know, here in Chicago, I cannot speak more highly
Steve Gaither 46:57
speaking speaking to that, when you came to the last troublemakers you brought a couple of cases, we ran out because everybody was slamming the systems. Boom, up comes to the top, the top floor Marquis, outcomes. Go puff delivery guy was amazing. Well,
Anthony Spina 47:15
and hey, the one thing I love to you because it’s like you targeted you like how does that work? What if you don’t like well, I guess I forgot I was robbed for my birthday. My idea was expired. So you know, they’re like, sir, we can’t like a Steve, come here. And then you’re like, oh shit, my ideas over there or whatever. And you’re like, how many CPUs talking about some damn troublemakers? How many troublemakers does it take to figure out an idea? But, but yeah, I mean, I was talking about, like, What a time to be alive, where it’s like, you can literally have like, alcohol delivered to a 21 plus event in 30 minutes. This is amazing. And also, you know, from an emerging brand perspective, I mean, it’s just, it’s so powerful. And it’s, it’s just really cool, dare I say, because it’s just, it’s a great way to kind of test the one that we’ve been selling out every week on golf club, which, again, has been super humbling. And it’s been great, because, you know, again, it shows that we’re connecting with people, which is nice. And then, you know, again, the on, I mean, that’s where it’s like, brands are built on the on, you know, again, times may change, some things stay the same. A lot of culture events, you know, a lot of, again, just support of, you know, genuine, like community events and things like, against how we, how we build perhaps how he builds old style, you know, I mean, the kind of, you know, White Claw tails, like, look, I mean, you know, you are a lifestyle and community brands. And it’s, it’s a playbook essentially, that that’s, it’s a playbook that can’t be replicated. Because every brand is different, and every person’s different, and all these different things. And that’s what makes it beautiful, is that you can’t just replicate this process.
Steve Gaither 48:49
While we’re having this conversation on December 30 2022. What is your New Year’s resolution? My friend?
Anthony Spina 48:58
Oh, okay, so, yeah, so you caught me at a great morning. So I, so you know, I, I don’t do New Year’s resolutions, to be honest, I do action plans. And so my New Year’s resolutions started this week. So and I think, you know, one of the biggest biggest things is to, to really, really make sure that all times we are, you know, staying true to the mission in the course of what we’re doing from a brand perspective, to make sure that, you know, everybody’s included in this and that, you know, for those that that embrace what it is that we’re there to support, you know, again, art, music, culture, community, I mean, that is just absolutely paramount. And then also the return of Chicago pizza Summit. So which has been a total labor of love, and that’s what were the hardest things I ever had to do was, you know, just to make that I mean, you know, when I look at the three core pillars, right, it’s cold pizza Summit, it’s community friendship dialogue, and, you know, I’m really Everything that’s happening with COVID. And all these things, it’s like, you know, it takes, you know, you plan this stuff out six months in advance and had to pull the plug or just, you know, say, Look, this year, it’s just it’s just not I mean, if there’s any potential to impact our community, don’t do it. Right. I mean, and it’s like, friendship is all about, you know, again, having a community that is safe. And just, I mean, the three pillars make it very easy to, to always have your Northstar. So I think that’s always the biggest thing is just in general Year’s Resolution across the board is to is to follow your Northstar. And especially from a brand perspective, like with system as you grow and evolve and things like that, just to just to make sure that you always understand, you know, why you’re here. And you’re here to support a community of like minded believers. And it’s been the absolute biggest honor of my life to have people come up to me and say, Hey, this means something to me. Or, you know, how has nobody done this before or this is really special. And that’s what makes it rewarding, because if you’re going to do something, you know, make sure it’s worth it. And that’s what keeps me going every day.
Steve Gaither 51:14
Well, speaking of honor, I’m honored to have you amongst the troublemakers my friend. Happy New Year and let’s see 23 rolls out.
Anthony Spina 51:24
Awesome. Well, you are one of the greats. This has been absolutely wonderful. And yeah, everybody follow the Windy City Troublemakers Podcast. If you ever want any amazing insider conversation, just ask Steve. He’s got all the answers. So there you go.
Steve Gaither 51:40
It’s just I know a lot of people smarter than me and as Anthony knows the bar as well. Everybody, thank you very much.
Anthony Spina 51:49
Take it easy. Awesome.
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