Spindrift: Bill Creelman

Bill Creelman graduated from college in 1996 with a business plan — to sell smoked fish from Nantucket. But over time, that idea morphed unpredictably into a brand that sold cocktail seasonings and supplies. After selling that company to liquor giant Diageo, Bill wanted to stay in the beverage industry. As a way of kicking his Diet Coke habit, he started making sparkling water with a fresh squeeze of lemon or grapefruit. That deceptively simple idea grew into Spindrift, a beverage that came with huge production challenges. Today, the company has an annual revenue topping $100 million. PLUS in our post-script "How You Built That," Gaurav Chawla loved home-made chai but hated how long it took to make. So he quit his engineering job and started the five-year process to create Chime — an automatic chai brewer that uses tea and spices from India. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Speaker 00

  I knew where the risk was, or at least I thought I did. But ultimately, there's just risk embedded in between the coolers and going up against the big soda guys and trying to do something really different in terms of the ingredients. All of that just was going to be challenging. So yeah, it was terrifying.

• 0:29Guy Raz?

  From NPR, it's How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built.

• 0:42Guy Raz?

  I'm Guy Raz, and on the show today, how Bill Creelman started out with a business plan to sell mail-order smoked fish, but instead ended up creating Spindrift and selling $100 million of sparkling water a year.

• 1:01Guy Raz?

  So back in 2019, the World Health Organization revised its guidelines for sugar intake. Sugar, it turns out, is actually worse for us than we thought, and too much can be deadly. Now, I say this, by the way, as I finish this delicious sugar cookie my kids made last night. Anyway, the new guidelines now suggest adults should not consume more than 25 grams of added sugar a day. Now, think about this for a moment. A single 12-ounce can of Coca-Cola has 39 grams of added sugar. That is a day and a half of sugar in a can of Coke. And if you go to the movies and get a 32-ounce cup, you will burn through nearly five days

• 1:44Guy Raz?

  of your sugar allotment before you get to the credits. So what to do? Well, the obvious answer is drink less sugar, which clearly is advice lots of people are taking, because last year, the sparkling water industry hit an all-time high in sales, nearly $2.5 billion, according to Nielsen. And it's why the beverage aisle of your local supermarket is now jam-packed with La Croix, and Topo Chico, and Bubbly, and Poland Springs, and Waterloo, and several other brands. And it's also why big players like Coca-Cola, Pepsi, and Nestle are all pushing into the sector. One of the fastest growing independent brands in sparkling water is called Spindrift.

• 2:28Guy Raz?

  And unlike virtually every other bubbly water brand out there, Spindrift's water is as basic as it gets, literally just a mixture of sparkling water and fresh squeezed juice, which may not sound all that innovative, but it's actually an incredibly challenging thing to make because fresh squeezed juice does not stay fresh forever. And Spindrift's founder, Bill Creelman, took years to figure out how to make it all work. And along the way, he struggled to find bottlers and distributors who would work with him. But the story of how he was inspired to create Spindrift probably begins much, much earlier, back in his childhood. Bill's parents chose to raise the family on a farm in western Massachusetts.

• 3:11Guy Raz?

  His dad worked for the sporting goods company Spalding. His mom was at home with the family. And pretty much all the food they ate was local and fresh.

• 3:20Speaker 00

  The thing I remember the most is just that all of the food seemed to come from our farm or the farms around us. So, you know, we had a sugar house up the street from us. We had, you know, milk that was delivered with a huge head of cream on the top, you know, unpasteurized. We would make butter from that. I think the key learning for me was just we had a very clear idea of where our food was coming from because it seemed to always be delivered from our neighbors or just off of our own farm. You know, food that was local and available.

• 3:56Guy Raz?

  And just to be clear, I mean, we're not talking about like the 1930s or 40s. Like, I believe at the time of this recording, you were 45 years old. So this is like the 80s. This is not that long ago.

• 4:05Speaker 00

  It really wasn't. And that's what I mean. It was really a choice. And, you know, I'm not sure what the message was we were supposed to take away from it. I would say my mom, she loved this idea of being out in the woods and being on a farm and surviving off of nature. And she was surrounded by friends that felt the same way. And we had almost no rules, honestly. She had this philosophy that, you know, have fun, do your own thing, and be adventurous. I think she sort of thought of the farm as our playground, our self-expression.

• 4:41Speaker 00

  I think the thing I remember is that the farm land just kind of continued in all directions. And so we had farmers to the left and right and around us. And even to this day, this neighborhood in in Western Mass is really still the same way. It's virtually unchanged today.

• 4:55Guy Raz?

  Do you remember how quiet it was at night from like December to, let's say, the end of March? Because I'm imagining there was so much snow, it was absorbing all of the sound at night, and it was just silent, maybe a little wind.

• 5:12Speaker 00

  I remember that really keenly. And I actually think of that often because now, you know, in the suburbs of Boston, you know, you that level of silence, that type of silence, it was really hard to find. You know, we would heat by firewood for the most part. We had a big wood stove. And when that fire would burn down to nothing, there was really no sound left in the house, save, you know, your breathing or the shuffling of, you know, of a sibling.

• 5:41Guy Raz?

  Was it an old house with like old wooden floorboards?

• 5:44Speaker 00

  Yeah, it was an old red, I mean, just where you imagine a red farmhouse, big red barn, creaking floorboards for sure. So I guess you knew if someone got up during the night. But other than that, it was, it was completely silent.

• 5:58Guy Raz?

  So I read that eventually your family moved off of that farm to the town of Deerfield, which is also in, I guess, in Western Massachusetts. And you went to to high school there.

• 6:10Speaker 00

  Yeah.

• 6:11Guy Raz?

  And then to college in Washington DC at Georgetown. And when you, when you got to college, like when you were 18 years old, did you have like any idea what you wanted to do with your life?

• 6:21Speaker 00

  Yeah. So now I was kind of out of the sort of grasps of Western Massachusetts. And I was really starting to, for the first time, think about what I wanted to do professionally. And, you know, I should mention that kind of in high school, and then as I started college, I was starting to work on the fishing boats off of the Cape and Islands.

• 6:41Guy Raz?

  Off Cape Cod, or, or like Nantucket or Martha's Vineyard? Is that right?

• 6:45Speaker 00

  That's right. And, you know, it was just, it was just magical. You know, you're on the boat all day, you're fishing for whatever you could catch, striped bass and bluefish. And so when I got to Georgetown, I really, I was working in the summers and then going to school. During the year and I started to really sort of solidify, crystallize, you know, what I thought I wanted to do, which was kind of try to figure out, you know, a business that would be interesting to me. So as I was finishing up Georgetown, I took my Coast Guard test and then eventually got my captain's license right after graduation.

• 7:23Guy Raz?

  And by the way, while you were at Georgetown, you met somebody who became, I guess, presumably became a girlfriend today, your wife, right? Is that right?

• 7:32Speaker 00

  That's right. Yeah. Very lucky to meet my wife Harley while we were Georgetown. And we started dating when we were 19. And so we've been, yeah, together ever, ever since. I'm not sure she quite knew what she was getting into way back then. But so while I was at Georgetown, I took an entrepreneurship class in my senior year and she, she got to see me present my, my sort of first business plan. So I guess she had some sense of what she was getting into even in, in the 90s.

• 8:03Guy Raz?

  And what was your business plan that you pitched to the class?

• 8:07Speaker 00

  It was called Nantucket Smokehouse. So the idea was taking smoked bluefish and striped bass and other things and creating a smokehouse out on island that we would then offer the products from all over the US. Turned out to luckily not an idea we ended up pursuing, but you know, the seed was planted for sure.

• 8:29Guy Raz?

  All right. So you, you graduate from Georgetown in 1996 and, and what did you do? Where'd you go work?

• 8:38Speaker 00

  So the first thing I did was go back out to Nantucket and actually continue now with my captain's license in hand, continue working on the, on the fishing boats, you know, it was probably my fifth year. And so I went out there with an idea of kind of finishing that summer and then, and then ultimately going out to the Pacific Northwest to pursue the smoked food world, or at least learn more about it. And so my wife Harley was living in, her girlfriend at the time was living in Seattle and. We piled into her VW and drove up the coast and basically just started hitting smoke houses and asking them, you know, what the industry was like. Did they like it? Did they not like it? Would they recommend going into it? And I'll never, I'll never

• 9:23Speaker 00

  forget finishing a tour and the guy who was leading me on the tour pulled me aside and said, let me do you a favor. Never get into this business. You know, it's fish, it's fire. You know, it is a shrinking industry. You know, it's nothing we would recommend.

• 9:39Guy Raz?

  And was that enough to convince you?

• 9:41Speaker 00

  It was at least enough for me to second guess it. And so I am incredibly grateful for that person's advice, for sure. And the business idea that ended up kind of coming out of it was a company called Nantucket Harvest. And Nantucket Harvest offered smoked food items that were already being produced, even though it ultimately, long term, was not terribly successful. It was much better than where we would have landed.

• 10:08Guy Raz?

  Right. Okay. So you're, so you decide, I'm going to go back to Massachusetts. I'm going to start a business where I basically, what, like source food from Nantucket and create like a mail order business?

• 10:24Speaker 00

  That's right. So it was mid, mid 90s. Nantucket had all these really interesting producers that, you know, I had gotten to know some of them over the years.

• 10:33Guy Raz?

  What were they making? Or what did they produce?

• 10:36Speaker 00

  Yeah. So they had, you know, it's 30 miles offshore. So it kind of has some really interesting, unique products, really only available out there. There was already a smoked bluefish pate, really beach plum jelly, really interesting jellies, bay scallops, you know, lobsters, ice cream. So our thesis was, well, if people love these in the summer, I bet they would love to buy them the other nine months of the year. And we wanted to provide them with a solution to do that.

• 11:05Guy Raz?

  So Bill, first of all, who's, who's we? You keep saying we. Who's the we?

• 11:09Speaker 00

  So in this case, my business partner was a childhood friend named Gil McLean. So we had grown up together. He actually lived in the farming community in Leverett. And so I recruited him to join me in this business.

• 11:20Guy Raz?

  And this is like really pre e-commerce, right? Because like imagine today, you would just have to put in some search terms into Facebook and or like AdWords in Google and you could reach people like in an instant. Back then, you had to like mail these catalogs out and you and your partner would just like sit around and wait for the phone to ring?

• 11:40Speaker 00

  Yeah, it's almost hard to believe, really. But that's exactly what we did. And we started with waiting for the phone to ring and then gradually kind of into the 90s and early 2000s, we migrated to more of a kind of a call center model. But we really were pre-internet. Towards the very end, we were able to take orders online. But really, the bulk of our business was all taken by phone.

• 12:05Guy Raz?

  So you would set up like a storefront or like an office, bring in stuff from Nantucket. And you set up, where did you set up your office?

• 12:13Speaker 00

  So we set it up in an old mill town in kind of the port city to Nantucket called New Bedford.

• 12:19Guy Raz?

  Sure.

• 12:21Speaker 00

  It took a couple thousand square feet. We put in refrigeration freezer unit and we went to work in 1997.

• 12:28Guy Raz?

  Where'd you have the money to start the business?

• 12:31Speaker 00

  Well, we didn't, is really the short answer. I had some savings from the fishing industry and our parents helped us out a little bit. But ultimately, we didn't. And so we actually turned to the town of New Bedford and a few other kind of economic incentive areas in southeastern Mass. And that's who provided our seed capital for us to get the business off the ground.

• 12:52Guy Raz?

  What do you mean? You like applied for grants from the town?

• 12:56Speaker 00

  We applied for grants from the New Bedford Economic Development Corp. They lent us $25,000 to start the business.

• 13:06Guy Raz?

  All right, so explain to me what you were gonna do. You were gonna bring in bay scallops and bluefish pate and ice creams and like on boats from Nantucket. And you were gonna do what with those products?

• 13:18Speaker 00

  Yes, so we were excited about really kind of storytelling around their product. And so we created a catalog, literally, you know, four and then eventually eight, 16-page catalog featuring their products. We would mail it out and the end of the summer is as the tourists were leaving the island. And what we learned is that people really, you know, other than maybe a birthday or a special occasion, the big time for mail order food was really kind of going into Thanksgiving. And then, you know, for that all of December, it was just crazy. Every day we'd pack hundreds and hundreds of these things and drive them up, you know, just as the UPS store was closing and the loading

• 14:00Speaker 00

  dock was closing. And so, yeah, we were, we were literally receiving orders in the morning, packing things by hand as much as many as we could get out. And then we would sort of count our shekels at the end of December and hope that, you know, we had sort of broken even.

• 14:18Guy Raz?

  It sounds like you couldn't really make a six-week, you know, sales window into a sustainable business.

• 14:27Speaker 00

  We never could. It really never, you know, and that was really the decision for us was, do we stay with this kind of on this crazy annual cycle? Or do we try to diversify? And it was really through that hard kind of thinking that we were fortunate enough for us to stumble on the wholesale side of the business, which is to say the side where you sell to stores on a regular basis.

• 14:53Guy Raz?

  And I guess, like, when you started wholesaling products, like, at that point, you kind of, you met someone who really set your business off in a completely different direction. Is that right?

• 15:04Speaker 00

  Almost, yes. And one of the products that we were featuring in the catalog was called Nantucket Offshore Seasonings. And it was a dry rub for grilling. It was in a silver tin, a really colorful label on the outside. And it was started out on island by husband and wife, had kind of a cult following, maybe a half a million dollar business. And so we were really fulfilling his customers' orders in the beginning. And what ended up happening, which was really sort of unexpected for us, is that He was a real creative guy, was always thinking about different ways to provide

• 15:42Speaker 00

  seasonings. And he stumbled one day upon a cocktail seasoning, so a salt for margaritas. And we put it in a tin, just like the other seasonings. And suddenly, the consumer just sort of woke up. And at the time, cocktails were just beginning to become interesting. And it was the time of sex in the city, and mojitos, and this sort of thing. And the idea of like a colored salt on the rim of the glass was actually pretty new at the time. And it was exciting to us. And the consumers seemed to think it was pretty fun. And so that's how we got into the business.

• 16:19Guy Raz?

  All right. So you had this company called Nantucket Harvest. That was an okay business, right? Was it barely profitable at its height? Was it profitable?

• 16:28Speaker 00

  It was never profitable. I would say break even would be generous.

• 16:34Guy Raz?

  Got it. Okay. But I guess at a certain point, you decide, hey, let's just focus on these cocktail seasonings and salts and whatever, and forget about the other Nantucket Harvest products, like the smoked fish and the scallops, right?

• 16:47Speaker 00

  Yeah, that's exactly what happened. So throughout all of these years, it's really just about survival, trying to find something to keep us going year round. And it was really through a whole bunch of trial and error that we landed on cocktails. And so we really ultimately got into the cocktail business as a result of the other businesses really not showing that kind of promise.

• 17:15Guy Raz?

  So at what point did you say that this was going to be a completely new brand?

• 17:23Speaker 00

  So what happened was two things. One was that our partner that I mentioned had decided he and his wife were sort of ready to move on. And my business partner and I, Gil, kind of asked ourselves, is this something that we want to pursue on our own? And we actually purchased him out of the business. So that was a big step. And then kind of within that, we recognized that Nantucket Offshore Seasonings may not necessarily fully represent the full idea and the opportunity. And we sort of got together and engaged a whole bunch of people, anyone that would listen to say, we want to create a platform and really just focus on cocktails. We want to be the premium cocktail business. And we ended up calling it Stirrings.

• 18:09Speaker 00

  We loved the name and ultimately, that was really the big idea that kind of catapulted us into, you know, kind of a national brand.

• 18:17Guy Raz?

  And it wasn't just the salts and the sugars, which was really, that was what cut you a lot of attention, but it was mixers and like sodas and stuff. And how were you coming up with recipes for this stuff? Were you just, did you work with other people? Did you have somebody make it for you? Did you make it yourselves?

• 18:34Speaker 00

  So this is where I would say we knew enough to be dangerous. You know, we knew what a good margarita tasted like, I think, and Bloody Marys. You know, I remember standing in my kitchen with, you know, kind of tomatoes everywhere. And really, the value of the brand initially was just in helping kind of demystify a cocktail and making it accessible to a much bigger audience. We saw that there was an opportunity. If you made the product interesting enough visually and, you know, the label was elegant, consumers would proudly display it in their spirit cabinet or fridge, wherever it was.

• 19:14Speaker 00

  And it really helped make the product much more accessible and drove a lot more interest and brand awareness.

• 19:22Guy Raz?

  I mean, was it pretty quick after you kind of created this line of products for Stirrings that it started to make money?

• 19:30Speaker 00

  What happened is the sales really took off. So eventually, a number of liquor distributors ended up bringing it on. But it was a really expensive, challenging product to make, you know, just for us to be shipping it around the country and doing it. So we were chasing break even throughout the entire business. You know, the food business is really like that. You know, you're always faced with the decision, do we want to go after the next level of growth or be satisfied with where we are and try to manage it to more break even? And I would say we chose to really sort of chase growth and make the brand, you know, the cocktail mix in the US.

• 20:13Guy Raz?

  But how were you funding the production of all these orders? Did you have to eventually raise money?

• 20:20Speaker 00

  You know, crazy enough, we really didn't. We never took outside capital at Stirrings. We borrowed like crazy. I mean, we were leveraged personally. You know, I had, you know, millions of dollars of notes that I was responsible for. We just tried to be as creative as we could and our supply partners worked with us on terms and that sort of thing. So it was really sort of moving, moving deck chairs around, trying to figure out where to, you know, where to, who to pay and what day.

• 20:49Guy Raz?

  Do you remember how many employees you had?

• 20:52Speaker 00

  Our high point was around 60 employees or so.

• 20:55Guy Raz?

  So, because from the outside, people must have thought, oh, my God, you're just swimming in cash here. Like, you guys are so, you're crushing it. But meantime, all of the revenue was going to just make more product.

• 21:07Speaker 00

  Yeah, I think that was really challenging because you're, you're exactly right. You have, you know, we had a big team at this point. We were showing up at everyone's sort of corner store, liquor store. And yet, we were from a kind of a business economics, fundamentals perspective, we were just making payroll. You know, I can remember

• 21:29Guy Raz?

  Wow.

• 21:29Speaker 00

  being in the north end of Boston, you know, hearing that we needed to move, find money to cover payroll that was three hours, you know, later in the day and, and having to find the cash somewhere. So that absolutely was a huge lesson for us, just how the optics of a brand and the expense associated with growing, you know, isn't necessarily sustainable out of just cash flow alone, even when you're on fire the way we were.

• 21:59Guy Raz?

  All right. So you've got this product that's just, you know, all the rage and people are doing their Sex in the City home parties and using your cocktail mixers and brand. Meantime, neither you nor your partner are probably even able to pay yourselves that, that much. And I guess around like 2006, you get an offer from Diageo, one of the biggest liquor companies in the world, to buy you out?

• 22:28Speaker 00

  That's right. Yeah, they had this huge portfolio and they were seeing the cocktail craze and we were lucky enough to get an article in the Wall Street Journal right around the holidays, you know, talking about

• 22:41Speaker 00

  How Stirrings was helping to demystify cocktails. And the next week, we got an inbound from their business development lead, who said he was interested in meeting with us and talking about partnering up to ultimately pair their spirits with our cocktail mixes. So, yeah, it was.

• 23:01Guy Raz?

  They owned like Smirnoff, Baileys, Guinness. I mean, some of the biggest beers and liquors in the world.

• 23:09Speaker 00

  That's right. You know, there was, there was a lot of synergies between what we did and what they did. And, you know, they had this huge network and 30,000 people and distributors and marketers. And we had a cocktail line that kind of went perfectly with everything they did. And so the prospect of working with this sort of global powerhouse and selling not just in the US, but potentially around the world, I mean, all of that was intoxicating. You know, and the plumbing was that we ultimately ended up selling them, you know, a percentage of the business with the idea that we would then exit the business to them entirely pending kind of growth and trajectory of the business.

• 23:51Guy Raz?

  All right. So basically, you came to terms and you agreed, I guess, to stay on for a couple more years before you left in 2000, you would leave in 2009? Is that right?

• 24:01Speaker 00

  Yeah. So actually, what was interesting to me back then was the idea of actually taking the business abroad to other markets. And so I actually moved now my wife and our two very young children over to London and lived and worked with their international team out of London for two years. That was intended to be the term of the partnership. What ended up happening is in 2008, the business and the partnership really kind of hadn't fulfilled the potential that we had all imagined. And there were a variety of factors for that. One was the economy changing. The other was sort of the fit between their big business and our tiny business.

• 24:43Guy Raz?

  Yeah.

• 24:44Speaker 00

  And so we ended up agreeing to exit the business to them earlier, just because it made sense for both of us.

• 24:52Guy Raz?

  So, so you, you walk away from Diageo and Stirrings. Reportedly, they, they bought it for $25 million. Obviously, you didn't get all that money and you got to pay taxes and all that stuff. But, but you did pretty well. You come out of that pretty well.

• 25:06Speaker 00

  Sure.

• 25:07Guy Raz?

  And what, at this point, I mean, you're like 34. Did you know that you were going to go to the next, onto the next thing? Or did you think, you know, let me just kind of, and just take some time to just breathe? And I don't know, what was going on in your head when you left?

• 25:24Speaker 00

  I was exhausted, honestly. You know, at that point, we had pulled forward this agreement with Diageo, you know, which was sort of hard fought and not quite the result we expected. It really was a, quite a difficult deal to finalize. And, you know, I felt like I had been going for a long time at that point and needed a break.

• 25:49Guy Raz?

  I mean, I'm just curious, did you walk out of that, that deal? Because like, people listening might think, wow, you know, he sold it to Diageo. He walked away with a few million bucks, like, triumph, you know? He's pumping his fist, he's feeling great. Is that, is that how you were feeling? Were you feeling great, triumphant? This was awesome. I'm so happy that it turned out this way.

• 26:12Speaker 00

  No, it was, it was really hard, actually. On the team side, it was really hard, despite some financial rewards. It was, you know, it was really hard to sort of disband it and then ultimately walk away from it. So I would say that disappointment for me was a motivator, though. You know, I was still in my early 30s, mid 30s, and I felt like there was a way to do it a whole lot better than what we had just experienced.

• 26:40Guy Raz?

  Coming up in just a moment, how stepping away from one business gave Bill the space to come up with a whole new idea. And then how he spent a lot of that money he just made trying to make that new idea work. Stay with us. I'm Guy Raz, and you're listening to How I Built This from NPR.

• 27:17Guy Raz?

  Hey, welcome back to How I Built This. I'm Guy Raz. So it's 2009. Bill Creelman is in his mid-30s, and he's just sold his cocktail supply business to Diageo. And he decides to move his family back to Boston from the UK. And for the next several months, Bill is kind of in a holding pattern.

• 27:36Speaker 00

  I was sort of, I would say, in receiving position, waiting for an idea or a thought or an inspiration. And I still loved being around food. I mean, it was, you know, I just get a charge out of walking down Main Street, you know, looking at what's happening in the world, observing people and what they're eating and drinking. And I was really sort of paying attention to the trends, you know, more than maybe just an average person would. And so at the time, I was a big Diet Coke guy. So, you know, the absurdity of starting a really interesting meal and going out and shopping for fun ingredients, which is what my wife and I love to do.

• 28:18Speaker 00

  And then in the same afternoon, you know, drinking three Diet Cokes. I mean, it just, it was at a certain point, it became confusing, really, because the kids didn't understand why, you know, the two messages around eating healthy and then why they couldn't have soda. You know, I was having a hard time reconciling it. And so my idea started to coalesce around soda and how there might be an opportunity to do something different.

• 28:44Guy Raz?

  All right. So you are trying to figure out something. I have to assume that you signed some kind of agreement with Diageo that you could not do anything in the cocktail space, right? I mean, that's usually how these things go.

• 28:55Speaker 00

  That's right. Yep.

• 28:57Guy Raz?

  But you could do something in the beverage space. That wasn't, and you knew a little bit about beverages, given that you were selling cocktail mixers.

• 29:07Speaker 00

  Yeah, that's exactly right. And you know, I was still around my team, you know, so Stirrings was still kind of going as a business now within Diageo. And I think it was hard to ignore back then, the kind of soda challenge. And so you'll recall, this is when sodas were getting pulled out of public buildings and taxes were starting to get levied. And so

• 29:29Guy Raz?

  This is like 2000, around 2010, right?

• 29:31Speaker 00

  Yep, 2009, 2000.

• 29:33Guy Raz?

  Like, I think New York was trying to, was considering banning like the 32 ounce drink, for example.

• 29:39Speaker 00

  That's exactly right. It was super exciting for me to start to think like, what is going to happen with this decline in soda? Are sodas going to go away? Is carbonation going to go away? And what's the root cause of all this? Is it the sugar? Is it diet? And so that puzzle, that idea was just hard for me to ignore.

• 30:03Guy Raz?

  All right. So meantime, you are a parent, right? And, and you've got kids and like most parents I know and probably you know, you prefer that they not drink soda because it's going to rot their teeth and it's really bad for them. They won't eat their dinner. But just full disclosure, I do let my kids have soda on vacation. So in your mind, you have this idea, maybe there's something in soda. And then how does it, what's the first step you take towards trying to make something?

• 30:32Speaker 00

  Well, so I, so going back to my, my childhood, I mean, I was really interested in ingredients. You know, I started to look at taking real ingredients, the, you know, something you would start a meal with, a lemon, an orange, a grapefruit. And what if this could become the base for, you know, a sparkling beverage? And so I was, I was in my house with a soda stream. I was cutting up fruit and squeezing it and seeing how it responded and settled in carbonated water and

• 31:04Speaker 00

  Tasting it with my wife and our kids. And I mean, the idea is not complicated. Everyone has lemons and, you know, has access to sparkling water. But the flavor that this created was just, as anyone that's ordered a sparkling water or, you know, with a wedge of lemon at lunch or whatever, I mean, it really is quite unusual. It has a lot more dimension of flavor. It's got a little bit of sweetness, a little tart earthiness to it. It's very different than what was out there. And so I began to research whether this was a unique idea or not, or something that had been done before. And that was really the genesis of Spindrift.

• 31:44Guy Raz?

  So that, I mean, that is literally like the conversation you started to have in your head with yourself, like, wait, this is great. Why isn't this a product available for sale?

• 31:54Speaker 00

  That's exactly right. And it actually didn't take all that long to figure out why. And the reason is because it's incredibly challenging. I mean, that flavor that you get from squeezing something fresh and putting sparkling water over the top of it is much, much harder to translate than I think I imagined and, you know, others may. I mean, it, so what I did literally was, you know, go online. Luckily, there was the internet at this point. Go online and really dig in. And that then sparked, you know, this whole other work stream to really then decide why, you know? Was it because these ingredients weren't available 12 months a year?

• 32:38Speaker 00

  Was it because the product couldn't be made and then sold commercially for some regulation reason? Was there not the consumer demand? And those are the questions that I set out to solve.

• 32:51Guy Raz?

  So what did you do? I mean, you're living in Charlestown in Boston. And did you say, all right, I'm gonna get an office and I'm gonna start pursuing this?

• 33:00Speaker 00

  Yeah. So I set up shop in our basement and I went about solving all of those problems. So I found really at the time, the only fresh juice supplier out on the West Coast and flew out there and saw how they were squeezing juice and then found at the time a bottler that was willing to handle all of this fresh juice. They had the facility, cold storage. And I started a fresh supply chain. So the only way we could make the product then was to refrigerate it. So we I would run a batch in Worcester, Massachusetts. I would ship it to a cold warehouse where it would remain chilled in Taunton, Massachusetts.

• 33:43Speaker 00

  And then I would load samples in the back of my Prius and drive up and down the East Coast. You know, Boston, Portland, Portsmouth, Nantucket, Cape Islands. And I would sell it. I would get people excited about the brand, follow up with them a week later and ship them product direct.

• 34:00Guy Raz?

  So initially, the drink was going to be fresh squeezed fruits into soda water, sparkling water in a bottle. And it had to stay refrigerated because that's how it would be preserved.

• 34:12Speaker 00

  That's right. Yeah, there was no other way to maintain that incredible fresh flavor that we were talking about at the time without keeping it cold. I mean, it just was too volatile a product.

• 34:25Guy Raz?

  Right.

• 34:26Speaker 00

  Maybe I'll just add to that, that it was also more of a soda profile at the time. So it had a little bit of sugar in it, natural flavors and color, you know, just sort of whatever. There were things added early on as we were just trying to dial in the flavor and in order to make it sellable.

• 34:43Guy Raz?

  This is the point, right? And we've had these conversations with entrepreneurs where you go to somebody and you say, I've got this great idea. Now, you had a track record, so people are going to take you a little bit more seriously because you're in your mid 30s and you've already sold a business. But you're going to go to people and you're going to say, hey, soda with a squeeze of lemon or orange. And someone's going to say, well, if it's such a great idea, Bill, why doesn't it exist already? Right?

• 35:11Speaker 00

  That's exactly right. I mean, usually people would say that must exist or they thought they were already getting that in whatever they were buying today or at that time. And so I actually didn't mind that people were questioning the ingredients and wondering why it hadn't been done. Or was it really being done? Were we really doing what we were saying? That was enough motivation for me to double down and say, okay, now I think we can really make a business out of this. As long as we're clear about communicating what is so special about this product.

• 35:45Guy Raz?

  Was that hard to find somebody who was going to bottle this? And even before you were making it, you know, in mass quantities, you just needed to make small amounts to, right? To see if. There would be interest.

• 35:57Speaker 00

  It was terrifying. I mean, you know, because you had minimum production quantities. We made, I think, 500 cases of each flavor. We had four flavors, so 2,000 cases and-

• 36:07Guy Raz?

  You had to make 500 cases just for the initial run?

• 36:11Speaker 00

  Just to turn the equipment on, yeah.

• 36:13Guy Raz?

  And you had to fund this yourself. Presumably, you're funding this with the proceeds from the sale of Stirrings.

• 36:18Speaker 00

  That's right. So, you know, we had to produce a minimum quantity and then we had to go out and shuffle it door to door. And the challenging part really, so the product was very expensive. It was $3 a bottle. So it really forced us to think hard about where, who would be interested in something like this. And obviously, with the decline of soda, there was a little bit of interest in alternatives. And that's really how we positioned it.

• 36:47Guy Raz?

  But you'd have to sell a lot of bottles, $2.99, to break even, to be sustainable. I mean, were you thinking like, okay, hopefully Target will sell it and put it in the refrigerated case? And I mean, were you going to some of your customers that had bought Stirrings brand?

• 37:03Speaker 00

  We didn't. I think we recognized pretty early on that the great thing about soda and sparkling water, unlike cocktail mixes, is that everyone sold it. So the challenge was actually more to figure out, who could we really get to champion this product? Where we ultimately found our people, if you will, is in the fast casual space, the people that were making delicious sandwiches or salads or that now were looking for a product that had a similar ingredient profile to what they were offering in their other food.

• 37:37Guy Raz?

  Got it. Right. Okay, so you've got this product and it's in some stores. And we should be clear, like, you had, at this point, two lines of beverages. You had the sparkling water with fresh fruit, but you also had like a soda with sugar, right?

• 37:52Speaker 00

  Exactly. Yep.

• 37:53Guy Raz?

  And then, and then what? I guess at a certain point, you say, hey, maybe we need to go to like, like lunch places, like food places where people are just ordering lunch to try and get our product in front of them?

• 38:05Speaker 00

  We needed a place to tell our story, really. So we went where people were excited about our brand. And it happened to be these small, independent, for the most part, sandwich shops and salad shops. And this was the time of Sweet Green and Kava. And Panera was changing their menu to be more health conscious. And we solved a problem for them because often they were, a lot of them were trying to tell a health and wellness story with a big soda machine. And so we could come in. Oftentimes, we actually even brought our own equipment, refrigerated equipment, and we would actually work with them. I mean, we'd sit down and say, okay, you're launching a cranberry salad or sandwich this fall. We have a cranberry raspberry. It's delicious.

• 38:49Speaker 00

  You know, let's story tell together. And that made for a pretty good partnership.

• 38:56Guy Raz?

  And this was being made in Massachusetts, like just outside of Boston? You had like a facility that would make your drink for you and bottle it and then put a label on it?

• 39:05Speaker 00

  Yeah, so what I would do is I would bring a truck in and the truck would take the batch, whatever we made, you know, 500 cases of each. And we would bring it to a cold storage facility in Taunton, Massachusetts. It's called Americal. And they would, you know, they had all kinds of other fresh items. You know, they were staging vegetables for the next day or cranberries or whatever. You know, they were huge, gigantic warehouse. And so we would tuck our little pallets into their huge warehouse. And then whenever I needed a sample, I would just drive down there. I would put on a gigantic freezer refrigerator coat, go out and pull product, and then I would take it out into the market.

• 39:48Speaker 00

  That food service focus with me and now my small team was really all we did for the first four or five years in our business.

• 39:55Guy Raz?

  And how did you come up with the name Spindrift?

• 39:58Speaker 00

  So Spindrift is the whitewash of a wave. When it's windy outside, a wave will kind of crest and the wind will shear the top of the wave off, creating this mist. And that wind-blown mist is called Spindrift. And one of my captains, when I was working out on the island. Introduced me to this name when I was probably 14 or 15. And for whatever reason, I don't know why, it really sort of resonated with me. I just, I thought it was really interesting word and spin and drift were interesting words, too. So I tucked it away. And so when I was thinking about what I wanted to call this now refreshing sparkling beverage, you know, it suddenly made sense to, to kind of recycle it again.

• 40:41Guy Raz?

  Now, here's the thing, right? You were funding this business with the proceeds from the sale to Diageo. But, I mean, what was your limit at? Like, at what point were you going to be like, ooh, I cannot use any more of my money because I'm going to blow it all on this thing? Like, were you, was there ever a point where you were a little nervous that you were just going to spend all the cash that you had on this thing that might fail?

• 41:06Speaker 00

  Yeah, sure. I was terrified. You know, I'd come out of this now, it was still very early and sort of the rebound out of the recession. So, yeah, these were real fears. And beverage is expensive. You know, I knew that even more so than my prior business that this was going to be a capital intensive business. I mean, you just, it was clear right away that between the coolers and going up against the big soda guys and trying to do something really different in terms of the ingredients, all of that just was going to be challenging. So, you know, we, from a family perspective, you know, we invested as much as we could. And then we knew we were going to have to kind of make some lifestyle changes and also

• 41:50Speaker 00

  think about bringing in outside capital.

• 41:53Guy Raz?

  Because just with your own money, your runway probably wasn't going to be that long, right?

• 41:58Speaker 00

  Yeah, exactly. So what we ended up doing is basically putting mortgages on our house and, but again, now you're talking about buying inventory and starting to hire a team.

• 42:11Guy Raz?

  Wait, this is nuts. You had, you had sold a business, you made a good amount of cash, and now you're taking a mortgage on your house to fund your next business? Like, you'd already done the crazy risky stuff in your 20s. You're doing this again in your 30s?

• 42:27Speaker 00

  I mean, yeah, I guess. The benefit of having gone through it before was that I knew where the risk was, or at least I thought I did. So ultimately, there's just risk embedded in startups and in food and beverage, and particularly in single-serve beverage space. So I would say we took calculated risks. Like, I would, I would bet on launching a market or a particular customer and make sure that that was up and running and successful, and then I would reinvest it again in launching the next customer.

• 43:05Guy Raz?

  And then, and then around, what, 2014 or 2015, you guys eventually had kind of a breakthrough because you finally figured out a way to, to store the Spindrift on a, like on a shelf with no refrigeration, right?

• 43:18Speaker 00

  Exactly. Yep, that's right.

• 43:20Guy Raz?

  So how did you figure out how to do that?

• 43:23Speaker 00

  At a certain point, we were on our own. And there was really no, we had no one in the industry that could have helped guide us in this area. I don't, I don't think I would have gotten into this business had I known how complicated it was. And, and again, the unpredictability of, of the ingredients you're starting with. I mean, the magic of every time you cut into a grapefruit, you're not totally sure what that grapefruit's gonna taste like. Is it sweet? Is it tart? Is it sour? We have those same challenges with our product. The fundamentals are that when you squeeze a lemon or an orange or grapefruit, it is alive. I mean, you know, you put it in your fridge, you know, as you know, it'll last a few days, and then it no longer tastes like orange juice or lemon juice. So our

• 44:07Speaker 00

  challenge is how do you preserve that incredible flavor? And, and the answer was to move very fast, to refrigerate like crazy, and then do it in a predictable way. So it also just required a lot of investment. You know, that was not a, a small decision to make, especially for, you know, a small business with a small team that You know, still with a very unsure future.

• 44:32Guy Raz?

  I mean, I imagine you had to like find food scientists who could figure this out. I mean, were there people who said to you, Bill, this is just, you can't do this. It's not possible, or it's not really possible to do this at scale.

• 44:44Speaker 00

  We've only frankly heard that. I mean, when we have our initial call with one of our bottling facilities, you know, they say, oh, geez, you know, I hope this isn't spin drift, is it? Because we've heard about you guys. I mean, you know, it's and the reason is the unpredictability. You know, when we show up with a tanker of fresh squeezed lemon juice, you know, it is, it is a problem for these plants because they have to run it right away. It's got pulp, you know, which no one particularly wants to deal with.

• 45:13Guy Raz?

  Wait, why don't they want to deal with pulp?

• 45:15Speaker 00

  So pulp, pulp is really fussy. I mean, pulp obviously is sticky, it's bits, it can get into these lines and then get sort of clogged or, you know, and so.

• 45:24Guy Raz?

  Ah, OK.

• 45:25Speaker 00

  So there, there wasn't a single carbonated beverage plant in the US that had ever handled a product like this. The closest was something like Orangina.

• 45:34Guy Raz?

  Yeah.

• 45:35Speaker 00

  You know, in Europe. And they, you know, had figured out how to deal, deal with pulp. But really, none of these guys wanted to be in the business of dealing with, you know, fresh juice and then carbonation. It really took us handholding them and, you know, the brewing industry has some of this, you know, particularly temperature sensitivity. But it took them really just focusing on it and deciding it, it was important and that we were willing to kind of stay with it until we got to a successful outcome.

• 46:05Guy Raz?

  And when does that happen? When do you like, at what point do you figure it out? Do you get the grapefruits and the lemons in the soda water? And then you could just put them on a shelf and you didn't have to refrigerate it?

• 46:18Speaker 00

  The first, we made one batch of raspberry lime. It was the first time we moved the product over from a bottle into a can. And it was really just on the back of that, you know, remaining stable that we decided we were now comfortable enough to roll that out. So it was 2014, 15, we finally broke through.

• 46:39Guy Raz?

  I guess around, what, 2016, you got into Trader Joe's. Was that like a total game changer for you in terms of visibility?

• 46:48Speaker 00

  It was a seminal moment for the business. At the time, we really didn't have any customers for the sparkling water. The soda was doing well in those food service accounts, but the sparkling water, the unsweetened version, was really not anywhere. And they, yeah, they just were incredibly brave and took on the product and initially just took it in the east. And we were lucky enough to then get expanded. And they really have just been a real believer. It really changed our business, honestly, because without that belief, I'm not sure that we would have had the conviction to continue to expand further into retail.

• 47:25Guy Raz?

  I mean, you had been in a position with your previous business, Stirrings, where you just saw this like hockey stick sales growth, right? Like, all of a sudden, it's just selling like crazy, but you're still not able to keep up. You're sometimes worried that you're going to make payroll. Were you in the same kind of situation in 2016?

• 47:45Speaker 00

  So by then, we had really made the decision, once the product was stable and there was clearly an audience for the retail version, we really said to ourselves, like, are we going to make a run at this? And we took the step to bring in some outside capital. We brought on an incredible team and really said, we're going to go sort of heads down. And really, I would say, really, that was the inflection point. We now are going to try to compete with the big guys, and ideally define or find our own space in this big and crowded category.

• 48:21Guy Raz?

  You've got this product, you've figured out the technology, you're in Trader Joe's, and 2017, you make a decision that is kind of crazy. You decide to stop selling the, because you've got two product lines. You've got the sparkling water and juice, and you've got the sodas, which actually is more or less the same thing, but with sugar. You decide, even though that's profitable, from what I understand, that you decide, we're not going to make that anymore. We're just going to make the sparkling water with the squeeze of fruits.

• 48:50Speaker 00

  Yeah, that was, that was a really important moment for us. And what we were experiencing, even just in our day-to-day lives, was just the concern around, around sugar. And so we had a low, very low sugar soda, but even that, among our team, was confusing. You know, people say, well, I don't drink soda, and say, well, wait, this actually isn't a soda. And so it was sort of the perfect storm. So we, we made the hard decision to shut down. It was about a $5 million business, super profitable, and just focus our resources on, on the sparkling water.

• 49:27Guy Raz?

  And, I mean, if it was a profitable business, you did this for the sole reason that you thought, let's just focus on this thing we do. Let's just make this a company about, you know, sparkling water with a squeeze of fruit.

• 49:39Speaker 00

  Yeah, I think it was, it was the recognition that in, you know, 2016 or 2017, there were, there's been a lot of innovation coming into beverage. And the risk was for us that if we didn't really stand for one single thing, that we were going to go down the path of so many other businesses where you sort of try to do everything pretty well and nothing really, really great. Both businesses were resource-intensive. You know, you have two inventories, two supply chains, you know, kind of two of everything. And so we said, look, if we're going to really be as successful as we think we can be, we just can't do everything twice.

• 50:19Speaker 00

  So I would say, though, it was purely on the belief that this was a big idea, and in order to get there, we had to do what we call simplify, amplify. You know, basically, really get behind the business we had.

• 50:33Guy Raz?

  So I guess at the same time you decide to drop the sugared soda, you also decide to stop using natural flavors in your drinks. And when I see natural flavors, I'm assuming it's like essential oils, like essence of cherry or lemon, just like a couple of drops in the drink, and then you've got the drink. Is that what natural flavors are?

• 50:56Speaker 00

  So we were, at the time, we had natural flavors in our drinks. And we started to get people writing in asking what natural flavors were. Natural flavors is the word that the government asks you to use to kind of describe the whole world of these essences that you just described. So we actually reached out to our flavor houses and asked them, can you just give us a little bit more information? We're being asked by our consumers, is it really just the lemon oils that are being squeezed? You know, they would say, let me get back to you. I just need to confirm that myself. Or they would say, we don't disclose that. And no one would tell us what they were.

• 51:39Speaker 00

  And so that's where, you know, we had to go rogue and really sort of start to investigate further on our own. I mean, I distinctly recall a conversation with a food scientist who was working for a flavor house at the time. And he said, let me go into a closet because I'm afraid if I have this conversation out in the open that I'm gonna get in trouble. And so here I was, you know, decade plus in the business, and I was putting an ingredient in that I couldn't totally be sure what it was. And it really, for us, was a problem.

• 52:11Guy Raz?

  Okay, but before that point, right? You were still making drinks with natural flavors? Because everybody was...

• 52:17Speaker 00

  Yeah.

• 52:18Guy Raz?

  Because that sounds fine, right? But then you started to say, well, if I don't know what's in it, and my suppliers won't tell me what's in it, maybe this is a problem? Like, that's what started to go through your head?

• 52:29Speaker 00

  Yeah, I mean, we went through, we reverse engineered the ingredients. We got in scientists, and we spent a lot of money. To really understand even what we were buying, I mean, I'm a little embarrassed to say because we just didn't know. There really is no standard for a natural flavor. There may very well be all of the things you described, but there's no assurance of that. And I don't think anyone felt they were doing anything bad with natural flavors. It was more for us, a decision that we made as a business, that we wanted to stand for what was in the product. And so we made the hard decision to get out of natural flavors entirely. That's really the, you know, kind of our position in the market.

• 53:14Guy Raz?

  Your growth from 2015 to just to 2017 was like 800%. I think in 2017, you did like $33 million in revenue. And this year, you're projected to do more than 100 million. I mean, what explains it? Is this more visibility? More people are just being exposed to it?

• 53:37Speaker 00

  Yeah, I think so. The, the growth has been attributable to, I think, just this incredible team that, you know, brought people into real ingredients. And obviously, we've been very fortunate with the turn of drinks to more of a, of a less sweet profile. And I think lastly, people really starting to care about ingredients and transparency and what they put in their body. And, and so I think we've been lucky to benefit from kind of all of those things happening simultaneously. You need all of them in different amounts.

• 54:16Guy Raz?

  Bill, you started this company in 2010. You grew up with, you know, your, your, your mom was at home, your dad had to work hard to support the family, traveled a lot. I have to imagine it's been kind of similar for you for the last nine or 10 years, trying to get this off the ground. I mean, have there been personal sacrifices you've had to make to get this business up and running and to make it successful?

• 54:44Speaker 00

  I think, you know, anyone that gets into startup space, and I guess specifically food and beverage, I think sort of knows they're going to be sacrificing a big part of sort of their life outside of work. I mean, it's just, you have to be 100% in, or, you know, it's probably not the right vocation for you. What I've tried to do is really focus on the business and my family, and I don't know any other way to do it. I've tried in the past, but I think particularly in a dynamic space like this, you really have to be 100% committed, or it's probably not, it's not going to end up successful.

• 55:25Guy Raz?

  What keeps you up at night? I mean, you're doing 100 million revenue, it's super successful, like, do you still get nervous and anxious, or are you like chilled out and able to kind of relax a little bit?

• 55:38Speaker 00

  No, we still have, we feel like we've really are just getting started. You know, if you look at the landscape of sparkling beverages, and there are some incredible brands out there, and we are, we're really kind of the new guy. So that's incredibly motivating for us. There's always risk to these businesses, and so I'm keenly aware of that. I never for a minute take any of this for granted. The challenge is how do you maintain everything you love about the business, what got you into it, as the business grows? I think the businesses that really get sort of lost are the ones that lose their identity.

• 56:23Speaker 00

  And so we're trying to do everything we can to ensure that doesn't happen.

• 56:26Guy Raz?

  How big do you want this company to be? I mean, what is being a billion dollar company important to you?

• 56:32Speaker 00

  Not captured that way. I mean, I think what I'm learning now with kids and kind of the world changing the way it is, for me, I think it's important that we are big enough to survive, you know, kind of through twists and turns. I just have incredible respect for brands that have survived, you know, decades, centuries, and are part of the fabric of culture. I mean, that's really interesting and exciting to me. So how do you measure that? I'm not sure. But I think we're marching forward and not really thinking about or being distracted by the other stuff today.

• 57:12Guy Raz?

  Bill, when you think about your journey, and you've had two successful businesses, which not, you know, one would be amazing, but very few people can say they've had two. How much do you attribute that to your intelligence and work ethic? And how much do you think that's just because you got lucky?

• 57:29Speaker 00

  I think it's a combination. So, you know, I've thought a lot about that question, and we talk about it even just internally a lot. We are all incredible workers, and our commitment level of the company is insane and has had to be for a long time. And what that allowed us to do is see opportunities when they surfaced. You know, when the world was moving out of sweetened beverages and sugar, we were positioned well to be able to see that and take advantage of those changes. So is that good luck? Is that, you know, why did we reposition that way? It's not clear to me, but I think we needed a good dose of both of those to get to where we are today.

• 58:14Guy Raz?

  That's Bill Creelman, the founder and CEO of Spindrift. By the way, back around 2015, Bill almost had to give up the name Spindrift. There was a legal problem with the trademark that had to be resolved, and Bill was just days away from changing the name. And if Spindrift hadn't worked out, the company's more than 100 employees would today be working for a beverage manufacturer called PressCraft.

• 59:06Guy Raz?

  Hey, thanks for sticking around because it's time now for How You Built That. And this week's story starts with Garav Chavla, who grew up in western India, where, like almost everywhere else in the country, people drink a ton of chai.

• 59:19Speaker 02

  People have it four or five times per day. Like, you know, people get bored, they make chai. They wanna relax, they get chai, they wanna sleep.

• 59:27Guy Raz?

  And for the non-chai drinkers out there, chai is a deliciously soulful blend of black tea and cinnamon, cardamom and ginger, often spiked with some hot milk.

• 59:37Speaker 02

  So chai is like, you know, ever-present in all aspects of life.

• 59:41Guy Raz?

  But actually, Garav only started drinking chai when he moved to California after college. His roommate used to make it every morning.

• 59:49Speaker 02

  And in those cold Berkeley mornings, you know, with the fog rolling in, I wanted to try something warm. And that's how I started, you know, getting into chai and I started loving it.

• 1:00:00Guy Raz?

  Loving it, but kind of hating it too, because chai is so time-consuming to make. Measuring the tea and the spices, heating the milk and then hovering obsessively over the stove.

• 1:00:12Speaker 02

  You're making the chai and you just look away at the wrong time. If somebody calls you at the wrong time and the chai boils over. You know, the milk goes everywhere, it sticks to the stove, so the stove is a mess to clean.

• 1:00:24Guy Raz?

  Now, you could just go to Starbucks and get a venti chai, right? But as Garav will tell you, chai made from a concentrate is just not the same. And because Garav is an engineer, he started to think about designing his way out of the problem.

• 1:00:40Speaker 02

  And then I started thinking, oh, wait, on the coffee side, there are so many machines and brewers. Why are there no chai machines in the market?

• 1:00:49Guy Raz?

  Garav started doing a little research.

• 1:00:51Speaker 02

  And I found out that there are product designers and then there are tea companies. And the tea companies have never been product designers. And product designers or coffee machine makers, they don't care about the tea market. So that intersection has to be... Hasn't happened.

• 1:01:06Guy Raz?

  Well, it hadn't happened until Garav got there. He quit his day job, working as an engineer at Salesforce, and he set out to make a brewing machine for chai, a little like a Keurig or Nespresso.

• 1:01:17Speaker 02

  When I started working on this, the first thing I did was I took a rice cooker and modified it, and I programmed it myself.

• 1:01:23Guy Raz?

  And after that first, basic prototype actually worked, he kept tinkering.

• 1:01:27Speaker 02

  Like, I would tell everyone I met that, hey, I'm working on making a chai machine. And initially, they would not understand whether I'm saying chai machine or time machine. And once they figured out, oh, I was talking about chai, like, their faces would light up. They would be like, oh, my god, I'll be your first customer.

• 1:01:42Guy Raz?

  And even at that very early stage, Garav was able to get a few angel investors interested in this project. And he raised enough money to hire more engineers and to find a factory in China to develop the chai machine. And I know, I just said all that in a few seconds, but this whole process, it took five years.

• 1:02:02Speaker 02

  It is tough. And it's not something that you can just like, you know, in the software world, you could just make something on a weekend, and people can use it, and give you feedback, you change it, it's very fast. Here, every single change takes weeks, so it was really tough.

• 1:02:15Guy Raz?

  And while all of that was going on, Garav was also working with a partner to source the black tea and the spices from India and to get it all packed fresh into these little capsules.

• 1:02:25Speaker 02

  And we have five different kinds of capsules. So one is just plain black Assam tea. Other ones are with cardamom, with ginger, with ginger cardamom.

• 1:02:33Guy Raz?

  All right, so basically, the way this all works is you choose your flavor, you fill the back of the machine with water, you put milk in the front, then you press the button, the machine brews the tea and heats the milk. And about three minutes later, you've got a cup of chai.

• 1:02:47Speaker 02

  And you can smell the spices.

• 1:02:49Guy Raz?

  Garav calls his company Chime, and late last year, he raised $100,000 on Indiegogo.

• 1:02:56Speaker 02

  And for us, the goal is to, you know, have this kind of machine available everywhere. So wherever you go, at home, at work, in cafes, in hotels, like, you know, there should be an easy way to get your chai.

• 1:03:08Guy Raz?

  But that's still a ways off. Right now, Garav and his team are focused on filling hundreds of orders from Indiegogo. But of course, he already has a chime sitting in his own kitchen, and he says he'd never go back to the old way of making it.

• 1:03:22Speaker 02

  Absolutely not. Like, I would never go back. I have better things to do than to watch milk and water boil, right?

• 1:03:30Guy Raz?

  If you want to find out more about Chime or hear previous episodes, head to our podcast page, howibuiltthis.npr.org. And of course, if you want to tell us your story, go to build.npr.org. And thanks so much for listening to the show this week. You can subscribe at Apple Podcasts or wherever you get your podcasts. And while you're there, please do give us a review. You can also write to us at [email protected]. And if you want to send a tweet, it's at howibuiltthis or at Guy Raz. Our show was produced this week by Casey Herman with music composed by Rumtin Arablouei. Thanks also to Candice Lim, Julia Carney, Neve Grant, and Jeff Rogers. Our intern is Sequoia Carrillo. I'm Guy Raz, and you've been listening to How I Built This.