Last summer, Coca-Cola announced an investment in Suja, an up-and-coming U.S. company that specializes in organic, cold-pressed juices.
San Diego-based Suja launched in 2012 and quickly made a name for itself in the beverage business. In early-2015, Suja ranked second on Forbes’ list of the most promising companies in the country. Coca-Cola’s investment opens up opportunities for Suja to dramatically increase its distribution.
Coke holds a minority stake in Suja (see an overview of the deal here), and we wanted to learn more about who's leading the company. I sat down for a conversation with Suja Co-Founder and CEO Jeff Church during a recent visit to Coke headquarters in Atlanta.
Church has an MBA from Harvard, a deep business background and a longtime love of Diet Coke.
You have a very eclectic background, from years in private equity to your most recent work in beverages. Take me through the evolution of your career.
I became a CPA and worked for Ernst & Young public accounting for three years. Then I went to business school, got an MBA and had an opportunity to work in private equity with Morgan Stanley. I did that and wanted to work in operations, because my dad had a manufacturing company and I just love the smell of cutting oil on a shop floor. I began to work in operations as a general manger, at 27 years old, at an industrial products company called Erico.
When I was about 38, I really wanted to go off on my own and start something and be an entrepreneur. So I quit my job and looked for a company to buy. I bought a company in Los Angeles called Aztec Concrete Accessories; it was a plastic-injection molding company. I was able to build that and sell it a few years later to a private equity firm.
With the capital I made, I started my own private equity firm and invested in other businesses. I bought a company called Lynx Grills; it’s a high-end outdoor gas grill company.
Then, about seven years ago, my wife and I wanted to take our kids to Africa. We spent a summer in Ethiopia and Kenya building water wells and missions. When we got back, my kids said, dad, you’re an entrepreneur, why don’t you start a business that donates to bring clean water to people around the world? So we started Nika, which means “to give” in Zulu. It’s a bottled water brand that donates 100 percent of its profits. That’s how I got into the beverage space.
Then, about three years ago, I was introduced to two young chefs that were making this great, green juice. I’m a meat-and-potatoes guy from Ohio, so green juice was not something I would normally be attracted to. But it kind of stopped me in my tracks when I tried it. I just figured if I can drink something with kale in it, then anybody on the planet can drink something with kale in it.
Are you at a point in your career where you’re doing things because they’re kind of fun and personally rewarding to you?
That’s what Nika was. Suja was much more of a capital venture, because we just saw a real opportunity. But I love consumer products. I’ve worked in industrial, construction and technology. Consumer is different. I like being able to take products home in what I call cul-de-sac management. My family will opine on them and tell me what they think. Not that the kids were the decision makers, but they were data points. I am at the stage in my career where I only want to work on products that are better-for-you type products.
You’ve got a very interesting group of co-founders at Suja. It’s you, with a deep background in business; Annie Lawless, a yoga teacher and onetime law student; Eric Ethans, a raw-food chef and surfer; and James Brennan, owner of several restaurants in San Diego. What are the roles of the group today?
James was effectively our head marketing guy for the first year or two, but now he’s not directly involved on a day-to-day basis. Eric was the chef who created the juice. He’s a super-creative, young guy, a big-time surfer. Eric is not active in the business any longer. Annie was the one who got introduced to cold-pressed juice and it kind of changed her life from a heath standpoint. She’s more or less the face of our brand. She’s got her own blog [see www.blawnde.com] and she’s pretty well followed.
Annie is in her 20s, so she’s probably like your core consumer for Suja.
She is our consumer. Millennials are really our biggest target. Millennials care a lot about ingredients. The Suja consumer doesn’t want unnatural flavors or added sugar.
Are you surprised at how quickly you’ve been able to grow?
I would never have thought we could grow like we did, but we just hit a convergence of different trends. One was organic. What’s crazy is organic has been growing at 15 to 20 percent a year for the last 15 to 20 years, but it’s still only about 4 percent of overall food production in the U.S. A recent survey of consumers by Gallup showed that 45 percent of Americans want more availability and accessibility of organics.
The second trend is the whole cold-pressed concept, which is growing in popularity with some consumers. It’s an alternative to other juices out there. We also use something called high-pressure processing instead of pasteurization. We put the product – bottled, capped and everything – into a hyperbaric chamber. We pressurize that chamber to 87,000 PSI, which is super high pressure. The pressure kills any pathogens that happen to be in it.
When you open a bottle of Suja, you get that fresh aroma and taste that you would get if it was made just the day before.
How did Coke’s investment in Suja come about?
Last year, about this time, we had some really great success with getting our products not just in the natural channel but in conventional grocery channels. We did really well with Target. We did really well with Publix, with Kroger, with Costco.
You kind of wonder sometimes, well, it’s great if you can win in the natural channel, but can you win in the bigger channel?
We did a study with Target with all 1,799 of their stores around the country. We divided into stores that were above $52,000 in household income, which is the average in the United States, and those that were below. The ones that were below were only about one-turn per week less in velocity. Suja does fine everywhere, and we’re the only brand that has an under $4, organic, non-GMO, high-pressure processed juice.
We have a first-mover advantage, so we wanted to really put the pedal to the metal and expand our distribution. We began talking with some potential strategic investors, including Coca-Cola. We just clicked with Coke. Personally, I’ve been a Coke consumer my whole life. Probably my favorite product on the planet is Diet Coke.
One of the things that was super important to us is that they not try to change us. We’re 100 percent organic; that’s one of our guard rails. We’re non-GMO. We wanted to make sure there was no influence on us to change that.
I actually met with Seth Goldman from Honest Tea [which was purchased by Coca-Cola] and had some dialogue with him about how did it work and how did it go. He told me that today, they’re using eight times more organics and non-GMOs than they did when he initially took an investment from Coke.
At Suja, we have clear control of our board of directors. Coke participates obviously, but they don’t have control. What we wanted was to take the best of the big company in Coke, which are things like distribution and leverage on costs. We also wanted to preserve the best of the small company, which in our case is our speed with innovation and a fast, flexible marketing group.
Coke has been a phenomenal partner.
How have your consumers reacted to the news of Coke’s investment? I’ve read the blogs, and some of your consumers don’t like Coke being involved.
We knew we were going to have a negative reaction from some of our consumers on the GMO-related issues. We’re non-GMO, and Coke has GMO in their products. We were very upfront about that. We said we understand your concern and we asked that they hang with us and hold us accountable to being organic and non-GMO.
We have no intentions of changing, and Coke has no intentions of changing us. Early on, I had dialogue with very senior leaders of Coca-Cola that that would be the case.
I personally was very responsive on Facebook and on social media explaining why we took this investment. Our mission has been to democratize organic, non-GMO juice and make it available to the masses at an accessible price point. And the only way you can really do that is have capital and distribution. If your interest is getting more non-GMO products out in the market, why wouldn’t you want to expand your distribution from, say, 15,000 doors to 150,000 doors?
What’s the work environment like at Suja?
Ours is a very open environment. We only have four people that are over the age of 40, so we’re very much a Millennial-based company. It’s very California. On a good day, I’m lucky if I wear a nice t-shirt. And on a bad day, it might be shorts and not such a nice t-shirt. We’re very casual.
Tell me a little about your family.
We have four kids, ages ranging from 17 to 22. Two in college and two in high school. My daughter, a senior at Stanford, just launched a business called Nomva [www.livenomva.com]. It’s a high-pressure processed, adult snack, probiotic business out of a pouch. It’s similar to the baby food organics in a pouch, but this is for adults.
All my kids have kind of got the entrepreneurial bug, which is fun. And they’ve all been part of Suja.
When we were growing fast, at one point on a Monday night I needed help from my son. I said, "Josh, can you go in and work the presses for a few hours?" He said, "I’m watching Monday Night Football." I said, "C’mon, Josh, it’ll only take a couple of hours." So he comes home at four in the morning, and it was a beet-juice run. He was completely red. It was a good experience for him.
Five years from now, where would you like to see the company?
I’m hoping we can build Suja into another billion-dollar brand and be a success story for Coke. And that we can democratize organic juice and make it truly available and affordable.
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