40. Interview w/Mark and Av- Co-Founders of Coco Vodka : The Alcohol Industry for Entrepreneurs

[00:00:28] Hugh: Hey, everybody. Thank you so much for joining us for another episode of Thoughts of a Random Citizen. Many apologies for releasing this episode a few days after promised. It's been a crazy week for a bunch of other things that I won't get into; however, if you are interested in one of the many things, just check out the previous episode where I rant about Spain [chuckles] for a bit.

One thing as well, everybody, we did want to apologize ahead of time, a small disclaimer that, at parts, some of the quality isn't up to standards that we like to hold, however, this is a one-off issue. If you do have any problem with it, please head over to Toarc United to get a full transcription. We'll have a link attached in the show notes as well in case you just want to scroll down and click. It's just one of the speaker's microphones and it's only so often where you might not be able to hear specifically. I personally don't have a problem with it, but we did choose to air this episode because the content is very good for you guys.

Again, if there is a point where you really wanted to know a specific answer and maybe didn't hear the exact answer word-for-word, please head over to Toarc United to get a full transcription word-for-word to give you guys exactly what you're looking for. Other than that, guys, this is an amazing interview; lots of laughs, amazing information that Mark and Av were able to throw on us. Excellent, excellent stuff, so settle down, buckle up, if that's a thing, and enjoy this really good episode with Mark Convery and Av Grewal, the two co-founders of CoCo Vodka and CoCo Rum.

All right, Mark, Av, thank you both so much for coming on to the podcast. I'm very excited to pick the minds of two entrepreneurs such as yourselves seeing as you're both co-founders of CoCo Vodka and CoCo Rum and that being one of the many hats that you both wear. Mark, can you start us off by telling us what you did before CoCo, how you met Av and then decided to start this venture?

[00:02:32] Mark Convery: Yes, for sure. Me and Ave, we go back almost 15 years. I had a sales and marketing company in Toronto, very grassroots, door-to-door type selling, going to businesses, helping them save money on different products and services, and Av and I met through that business. We kept really tight, we were doing really well, and then he went off to be a lawyer.

[00:02:54] Hugh: Nice.

[00:02:54] Mark: [laughs] He went off to be a lawyer. I kept going on with marketing and sales. He came back to Canada and decided that he wanted to get involved with alcohol, and I thought that was pretty cool because I always wanted to start a bourbon. I'll let Av continue the story from there, but I always wanted to create a bourbon. My roots are back in Australia, and I love Bondi Beach, and I know Australians love bourbons. [crosstalk] I always had an idea--

[00:03:22] Hugh: [crosstalk] Any mixed drink.

[00:03:24] Mark: Yes, any mixed drink. Bondi Bourbon was our first venture together. The way that connected was Av coming back to Canada, getting involved with alcohol and distribution and not wanting to be a lawyer.

[00:03:38] Hugh: Nice, good call there.

[00:03:40] Av Grewal: When we found out that such the big companies distributing wines or alcohol and that I was thinking to myself, was like, "What do I want to read for rest of my life and be a lawyer when I can make drinks, that's kind of the goal." We were in distribution for about six, seven years; Mark and I, we always kept in touch. It was like, "You know what, let me just get my feet wet and get everything going and we'll launch a bourbon," and that's exactly what we did. Then we wanted to create other brands and CoCo Vodka was next.

[00:04:11] Mark: The problem with bourbons is it sits in a barrel for four years, so it's not a very profitable business.

[00:04:18] Hugh: At least for the first four years.

[00:04:21] Mark: Yes, that's right. That's what eventually led to CoCo Vodka and CoCo Rum.

[00:04:25] Hugh: That leads me up. Being as you're both from Canada and knowing that that's not the warmest place year-round, how did you guys come up with the idea of the CoCo Vodka, because that just makes me think of sitting on a beach somewhere? Were you already in the US, had you had planned on coming there? Can you just-

[00:04:47] Mark: Good question.

[00:04:47] Hugh: [crosstalk] -tell us the mindset?

[00:04:48] Mark: Both I and Av were looking to create a product that you could put in the can, and we knew worldwide coconut water sales was growing up. We've always wanted to create something different. Bourbon was neat because two Canadians involved with a bourbon is unheard of. If we were going to get into the canned cocktails, we didn't want to make another seltzer, we didn't want to make another box of soda. We were shocked that no one was making a hard coconut water.

We thought, "If we could be the first to go to market as a hard coconut water, that's different." Then we started mixing drinks. We mixed coconut water with vodka, it tastes great; we did it with rum, and we were onto something. That's how we came about and started making the product.

[00:05:27] Hugh: That's crazy because I had no idea that nobody even had coconut water anything. Then I started to research, I was like, "This a really good idea, how have I not even heard of this?" I thought I drank it before but I hadn't.

[00:05:38] Mark: Yes, that's right.

[00:05:39] Av: Yes, we always wanted to be in the US, that was something that was important, so we started off in the US and try and get our feet wet there. Then just being Canadian, we have LCBO here in Ontario, which is the world's largest liquor buyer. We were like, “You know what, let’s just pitch it to them and if we get in, we’ll whip up the Canadian market at the same time and that's what happened, then we started the in USA and Canada at the same time, which is awesome.

[00:06:13] Hugh: Are you guys incorporated in the US or are you incorporated in Canada? Then on top of that, can you walk with us through the difficulty of dealing with both or the ease of it maybe?

[00:06:25] Av: We're incorporated in Canada. Being Canadian, it's much easier right now, everything else is outsourced in the US. Working in the US, every state is its own country, so we work with a compliance company that helps us figure out all the rules for us. We knew quite a bit of it, just we need to be under 5% alcohol, some states where we sell to groceries, so we learned a few things there, or labeling the packaging and all that stuff, there was a lot of red tape around that. We learned the basics there. Then Canada is a whole different beast because you had to have French as well.

[00:06:58] Hugh: You have to have what? Sorry.

[00:07:00] Av: Add French to our cans.

[00:07:01] Mark: It's a bilingual country, so you had to have French and English on your can. [crosstalk]

[00:07:04] Hugh: Oh my goodness, yes. Wow, I didn't even think about that, geez. [crosstalk]

[00:07:06] Mark: We had to create new packaging.

[00:07:08] Av: We had SKUs, technically we have four SKUs because the packaging is different for both, plus all states are different; in Canada as well, provinces. Just like the how the US, these provinces, the state is its own country, so with Canada.

[00:07:25] Mark: Canada has another level of difficulty because its government-run in many of the provinces too. If you can make it in Canada, you can make it anywhere, as we always say, because it's very difficult. That's true with quality and stuff. Our goal was always the USA first, and it just so happened that we launched both countries at once.

[00:07:44] Hugh: Well, France, isn't too far away then I'm assuming, right?

[00:07:48] Mark: Yes, we have French all over it. [laughs]

[00:07:50] Hugh: Yes, exactly. Well, that's cool. I was going to ask specifically because obviously being an entrepreneur, it's always been in the back of my mind, "Oh, I want to start an alcohol company, who the hell doesn't to?" [chuckles] How much red tape-- like how much of that time is taken up doing and dealing with state to state, county to county, you can't sell in the grocery store here but you have to deal with it? Is that just all thrown onto the distribution or distributors? How easy is it for you guys?

[00:08:21] Av: Distributors, they help you a little bit. To get registered, to get started, it's all up to the suppliers, you got to know that stuff before you jumped into a state. If you're not doing it properly, they're going to come and they're going to hound you. Luckily, we work with a compliance company, and they know the business. That was one thing that we--

We had to make sure we outsource the ones that were the red taped, the compliance part because, to be honest, we don't want to deal with any of that. Our focus was on selling and working and creating a product. Luckily, we have them to work with us; we'd recommend that for anybody that will get started with this, it makes life far easier.

[00:08:55] Hugh: Or just have one of you guys be a lawyer, that also helps, right?

[laughter]

[00:08:59] Mark: It does, yes. Entrepreneurs, there's never ever a book on whatever business you're starting. It's funny, a lot of it is just trial and error. Me and Av are really persistent hardworking guys. A lot of it comes back to if you know where you want to head to, you go as quickly to fail and quickly to fall forward, and we did a lot of it really, really fast. I think most people are surprised that we're in two countries and 30 states and four provinces in 18 months. People are like, "How is that impossible?" A lot of it is trial and error too.

[00:09:35] Hugh: Wait, so just reversing there for a bit. You said 18 months, you guys have only been out? You started in the middle of the pandemic?

[00:09:41] Mark: We literally launched, January 2020 was our first sale in the US, which was crazy because it did take a year and a half before to, like you said, put all the packaging together, all your label approvals, and all these different rules in both countries. Then the pandemic hit and that wasn't-- it was great for alcohol but not if you're a new brand because they didn't want to take on new brands, they wanted to work with what was already selling. We got our lucky break, it was in New Hampshire, July 2020. From July 2020 to now, we're now in 30 states, four provinces. We're about to expand to 45 states in the next four to six months. It's been wild.

[00:10:20] Hugh: Can you elaborate on that lucky break? What exactly happened?

[00:10:25] Av: To be honest, we were looking for a distributor for six to eight months--

[00:10:29] Mark: Yes.

[00:10:31] Av: We would literally just take anybody that would take our product. Because of the pandemic hit, people didn't want to bring on new products and you're stuck holding inventory for a bit. Right away, our distributor in New Hampshire said, "They're doing great. This is something we've never seen in our products. We definitely want to--

[00:10:49] Mark: Be part of it.

[00:10:50] Av: Slowly after that, it was kind of like a domino effect where things started rolling. By the end of the year, from July to December, as of December, we have 20 states, so we rolled up.

[00:11:02] Hugh: Jesus.

[00:11:03] Mark: Yes. A lot of persistence and samples. Even when they said, "No," we said, "Great, we're going to send you samples." We wouldn't take no for an answer. We were like, "We know we have something special here, you got to try it." When they would try it, they would call us back. It was good.

[00:11:19] Hugh: Yes, that's easy. It's easy when you have a good product. That's something-

[00:11:21] Mark: That helps.

[00:11:21] Hugh: -for everyone to always remember.

[00:11:23] Mark: Yes.

[00:11:24] Hugh: Yes. Sticking on that pandemic and supply chain issue there, how much of that is a focus for you guys moving forward, especially considering 90% of restaurants were shut down during the pandemic?

[00:11:36] Mark: Yes. Our focus has shifted from-- we went heavily in the retail. Once we got a few distributors, we were like, "We got to really go heavy with large retail." Av actually set up a meeting early that year with Walmart, he was on the last meetings before they put it on lockdown. We got approved at Walmart, which was pretty crazy for a new brand, no one ever heard of.

We got approved for not only our two SKUs that we already made but two SKUs that we had literally in these plastic bottles that they love the taste of. We went heavily into retail. Now that COVID has eased up, our focus is now pushing into restaurants, clubs, hotels, golf courses. We're already seeing the benefits of making that bit of a pivot as well.

[00:12:19] Hugh: Golf courses, I wouldn't have even thought of that, but that seems like it would kill.

[00:12:21] Mark: Oh, yes. It's high grade and refreshing. It's definitely built for golf courses as well.

[00:12:27] Av: I wish you guys could see the reaction. We just did an ESPN golf tournament down in Houston about two weeks ago, I think. Just the reaction, everybody, people, or just beer drinkers, or whatever else they were. They're trying Coco and losing it, and not with foul language, but in a good way.

[00:12:45] Mark: Yes.

[00:12:46] Hugh: That was always me before I lived in Australia where literally everything is a premixed drink. Once I went over there, I was like, "I don't even care. Just give me the premixes." It's the best bang for your buck anyways, really.

[00:12:57] Mark: It's so simple, yes.

[00:12:59] Hugh: I know you were talking about New Hampshire, what areas are you having the most success in the US and Canada?

[00:13:04] Av: US, pretty much-- We're doing pretty well in Texas. That’s been a big state for us, obviously it’s a large state. We work with a great distribution partner there. Mississippi, surprisingly, has been one of the biggest states; reason being, our biggest thing is liquid to lips, so tasting and getting them to try it. They didn't shut down tastings during COVID, so that really helped us keep the traction and keep the pedal to the metal there. Maybe on the east, we're just about to launch in the majority of the west states, but the majority on east, Ohio would be fantastic. We've actually just teamed up with Cleveland Browns, so we're doing some big things over there.

[00:13:44] Hugh: Oh, wow. That's cool. I'm not a huge Browns guy, but that's cool.

[00:13:48] Mark: Yes. It's cool to just even be part of the NFL. We've created this drink, and then all sudden, we're at a stadium, the NFL. [chuckles]

[00:13:56] Hugh: Yes. That's crazy.

[00:13:58] Mark: Yes, the US is blowing up. Then Canada, obviously, once we got approved at Ontario, the largest buyer is the LCBO, it's a government-run province, but we killed it this summer. We were one of the only brands that got in that they kept as a full-time brand. That was a massive market. Because of the excitement we created in central Canada, the West Coast started selling out as well. The buzz was spread.

[00:14:24] Hugh: You said you're not even in like West Coast US yet, and I imagine that it's going to destroy when it comes to California.

[00:14:34] Mark: Yes. We don't even know how we're going to keep up.

[00:14:37] Hugh: You aren't in California yet?

[00:14:38] Mark: No. Or Nevada, which I think would be big too. This is perfect for the pool parties.

[00:14:44] Av: Arizona, Nevada, California.

[00:14:44] Mark: Yes.

[00:14:46] Av: Just ship out to Colorado today I think.

[00:14:48] Mark: Yes.

[00:14:49] Hugh: Are you guys in Florida?

[00:14:50] Mark: We are, yes.

[00:14:51] Hugh: Okay. I was about to say-- I assume Florida and Cali would just be the killers for you, but I don't know. That's just me.

[00:14:57] Mark: Florida is big now. I just got back from Miami yesterday, and we did the rum festival because we're one of the first canned cocktails that has rum in it. We actually applied to the rum festival where everyone just loves rum from around the world, and they were crushing CoCo Rum. It was good, they loved it. They thought it was the most innovative, creative product. Yes, it was good.

[00:15:17] Hugh: Coconut water and rum, that sounds weird but obviously it tastes good.

[00:15:21] Mark: It sounds like a good song even. [crosstalk]

[laughter]

[00:15:25] Hugh: Yes, right? That's funny. Moving on, I was going to ask, are you guys planning on moving to Australia? Before we get to that, how exactly does Bondi Distillery fit into the CoCo product line and your guys' bourbon and all that?

[00:15:40] Mark: Great question. I lived in Australia, I know it's a nice spot for you that you talk about a lot and me too. 20 years ago, I lived in Australia. I fell in love with bourbon in Australia and, believe it or not, it was on Bondi Beach. Since that moment, even though when I started my own marketing sales business, me and Av connected, part of me always wanted to have a Bondi Bourbon, I just thought it sounded great. It'd be really cool to go back to Bondi Beach and enjoy your own bourbon.

We started with the Bondi Bourbon, but then when we created the CoCo product, we created the name, the Bondi Distillery just so that some of the roots of how this all came about tied into our future projects and that's where the Bondi name comes from as well.

[00:16:25] Av: Also, what really got me with the Bondi name, Mark mentioned it, was the-- It has a native meaning which means water splashing against rocks. It's kind of like pouring bourbon on ice.

[00:16:35] Hugh: What?

[00:16:36] Mark: Yes.

[00:16:38] Av: It was a Google search we did, that's what we wanted to name it. We're like, "You know what, this makes sense." It splashed it. When we're pouring the bourbon or a CoCo over ice, that's kind of a Bondi means, that's the feeling that we get. That's why we really liked it.

[00:16:53] Hugh: Wow, that's promotion written all over it right there.

[00:16:56] Mark: Totally, yes.

[00:16:59] Hugh: That's crazy. Going back to are you guys planning on spanning to Australia? Is that in your time horizon? Then how difficult would that process be? I'm assuming it's not as easy as US to Canada.

[00:17:11] Av: We're just so focused on North America right now, there's a lot going on. A lot of people don’t trust right now to import a new product into their country, whether it’s Costa Rica or wherever else, but we have so much to go, especially launching in these new states, 15 states next year. If we've already partnered though, we’ll look at it for sure.

[00:17:38] Hugh: Not to be rude to Australia or anything, but the population of California is about the same.

[laughter]

[00:17:44] Mark: Exactly. Yes. [laughs]

[00:17:45] Hugh: That's one of those things.

[00:17:46] Mark: Yes. It's easier to ship across the country than overseas to another one.

[00:17:52] Hugh: Yes, and then not only that but then when you're in Australia, it's a huge continent that you have to take forever to even distribute to city to city there. Back to Canada for a second, I'm just on these countries right now for whatever reason, but I'm actually quite interested to find out if you guys are even considering, I doubt it, but I figured I'd ask just being popular, a THC-infused beverage. I know that it's obviously being talked more with the THC companies, but is that something that is even on your guys' thought process? Is that something other people in the beverage industry are considering or?

[00:18:31] Mark: You bet. Yes, so funny enough, we created CoCo Rum down in California, so we partnered with a place that makes drinks. Quick into it, we had a lot of friends that were opening up marijuana stores and getting involved with THC. Actually, Av came up with the idea, "We should make coconut water with CBD and do the exact same thing," so we actually created the formula, we just haven't done anything with it because vodka and rum was already a market that was tough enough with different restrictions in alcohol in different states.

THC and CBD, it's definitely a future mover, but we just chose the lesser of evil for expansion, which was, "Let's play in alcohol first and then maybe learn a whole other industry that's evolving."

[00:19:21] Hugh: Yes, no joke.

[00:19:22] Mark: [crosstalk] It does taste great. We've created something that I think everyone will love as well.

[00:19:25] Hugh: You have actually had it?

[00:19:27] Mark: Yes.

[00:19:27] Av: It's really new, it's in our vault.

[laughter]

[00:19:30] Hugh: Oh, God. [laughs] You guys will have to send that to me, please, because I'd like to try some of that.

[00:19:33] Mark: Yes, we could definitely get to some samples. [laughs] We'll have to find out the rules though. Even sending stuff like that around us is really tough.

[00:19:41] Hugh: It's probably not even a thing. I know that they have medical pretty much everywhere now, but you can't really-- do you know if there is-- you're not allowed to do THC and alcohol in the same beverage, right?

[00:19:54] Mark: Yes. There's some different rules in every province and state, right? Canada's open right across

[00:20:00] Mark: the map. There's a lot of creativity around drinks and edibles.

[00:20:03] Av: That's sounds real dangerous.

[00:20:03] Mark: That sounds like a wild combination, yes.

[00:20:07] Hugh: Yes, people just be spinning out on the street. [laughs]

[00:20:10] Mark: Yes. Well, people used to think Red Bull and vodka was a bad idea, but then it became a big drink around the world and the hype got passed. Maybe it could be alcohol and THC, you never know.

[00:20:21] Hugh: I always say, if I want to blackout for the night, I'm drinking Red Bull and vodka.

[00:20:24] Mark: There you go.

[00:20:25] Hugh: How is that idea?

[laughter]

[00:20:27] Mark: Now, you can do a CoCo Vodka with Red Bull and you'll be hydrated the next day because you get the essential nutrients in coconut water, right?

[00:20:34] Hugh: Oh, yes. Are you guys making a lot of mixed drinks with this? It's a mixed drink in and of itself. I saw on your guys' website that you had some mixed drink competition or something that seemed pretty intriguing.

[00:20:46] Mark: Yes.

[00:20:47] Av: Initially, we never thought of mixed drinks, we were just like, everybody is going to just crush a bunch of CoCos, but just consumers started sending us all these videos on social media saying, "I just made a CoCo mojito, I just made a CoCo--" whatever. That's what we started pitching to bars, restaurants, and that just took off from there. We have CoCo mojito, CoCo-

[00:21:09] Mark: Mimosas.

[00:21:10] Av: -mimosas, CoCo Rita, you name it. You can mix this drink, it's very versatile compared to a lot of the drinks on the market. You can make whatever you want with this, which is great.

[00:21:20] Hugh: Wow.

[00:21:20] Av: A lot of people are adding-- if you want a little bit of a sticker shot, a lot of flavored vodka to coco vodka and just take it down like a jager bomb kind of style, they call it the CoCo Ball.

[00:21:31] Mark: Yes. The creativity of the customers, what they've done is, I think that's the most exciting thing. Every day we get new videos and pictures of people saying how they're enjoying CoCo, but the cocktail thing was definitely something that caught us and we were like, "Wow, this could be really big," so we threw a cocktail challenge. We had probably about 80 submissions of people making different drinks using a CoCo Vodka. Some of those sparked some ideas for future creations.

[00:21:59] Hugh: Wow, there you go. Just take one of those and throw it in your own can, you know?

[00:22:03] Mark: Yes, yes. Yes, we've got ideas now.

[00:22:06] Hugh: Well, sticking with that website and the social media, Mark, I've noticed and I believe that's your alley there, that you've done a pretty amazing job with just the website and everything that you've done with the competition and all that. In regards to marketing today, what do you find to be the most necessary and or successful strategy for rapid growth that you found success with?

[00:22:29] Mark: Number one is being different. We didn't want to be like the other brands, we didn't want to be another seltzer, so we embrace that with all of our marketing. If you go to our website or social media, everything's colorful, everything's fun, everything's exciting. Number two is just being authentic. We didn't want to get a bunch of fake people on our website, we wanted actual fans. Pretty much every single person you see on our social media or even our website is authentic customers enjoying CoCo that they've given us approval to put the pictures on our marketing materials and stuff.

Then number three, it's something we're working on, but just making it flow really easy so people can find what they want. If you go to our social media, you'll know that it's a tropical fun, warm, different beverage. Same with our website, you just get a feeling like you're on an escape the moment you see it. A lot of it is tied in between those three.

[00:23:27] Hugh: All marketing nowadays, it's just social media, right? Do you even have to do anything else?

[laughter]

[00:23:33] Mark: We were talking about that today. We tried to print ad and that didn't seem to work great. We've tried all sorts of different--

[00:23:43] Av: Radio ads.

[00:23:44] Mark: Radio ads, but social media and podcasts seem to be the best way to get the word spread. We're very connected today and our timeline and where we seeing things is all over the place, but social seems to be the most powerful with podcasts now.

[00:24:00] Av: The other day we had a video that reached-- a user-generated video that reached 7.5 million views and you're just blown away.

[00:24:11] Hugh: Wow.

[00:24:12] Av: To be honest, we didn't pay for it.

[00:24:13] Mark: We didn't pay. [crosstalk] People just drinking.

[00:24:17] Av: We've spent a couple thousand dollars here, a couple thousand dollars there on ads which maybe a hundred people, 200 people saw it or even paid attention to it. That's what we're thinking right now. Obviously, for us, that's one of our uphill challenges, is creating awareness. That's been one of our biggest challenges just moving forward. We're marketing every day.

[00:24:39] Hugh: Social media is so easy to do that with. I guess is social media one of those things where-- I know in the US, you're not even allowed to have a commercial with someone drinking it, right? You can have it right there, you can have pretty much everything besides the actual act of drinking it. Does social media restrict that, or is that just free and fair game?

[00:25:00] Mark: They have some rules, yes, which we found also with colleges. Now that all the students are drinking CoCo Vodka, CoCo Rum at tailgates, you have to be careful that, one, they're all of drinking age and, two-- yes, we've had some pushback if they're drinking a can versus holding a can. TikTok is a little more free. Well, you can do whatever you want on TikTok. I think that's why it's becoming a bigger platform than Instagram and Facebook. Instagram and Facebook are still our good-to, but we're really amazed what you can get away with and be more true to yourself on TikTok.

[00:25:38] Hugh: Do you have any idea of why that is, it's not a size regulated or just?

[00:25:42] Mark: Yes, I think because they're trying to crack into the whole platform of taking on Facebook and Instagram, you got to be a little different, and maybe that's the gray area that they decided to go with. Yes, that would be our only hunch.

[00:25:58] Hugh: Wait, just speaking on this for a bit, it's just interesting to me. Is it Twitter and Facebook then come to you and say, "Hey, this person's actually drinking on your site, you have to take that down."? Is it them?

[00:26:09] Av: We had a post, I think, this is when we first started. We made a post and then all of a sudden, we boosted it and added, whatever we added, then all of a sudden, it's gone, you can't see it anymore.

[00:26:21] Mark: Our whole page was gone. [chuckles]

[00:26:22] Av: Yes. We thought our page was gone once--[crosstalk]

[00:26:24] Mark: It's like, "This is against good--" [crosstalk] [laughter]

[00:26:25] Hugh: Panic mode, panic mode.

[00:26:28] Av: Now we have an in-house social media team that handles everything. They handle all of that because they know the in’s and out’s of it. So, that has helped us quite a bit. Before, we were just going to freestyle, but--

[00:26:40] Mark: As entrepreneurs, it never happens at the right time ever. We did a post, we did this-- I met Kevin O'Leary from Shark Tank and Dragons' Den like four years ago, and I met him in an airport and it just caught him off guard. I was like, "Hey, my partner, we're starting this coconut water, a hard coconut water beverage. Can we reach out to you when it becomes big?" He's said, "Yes, for sure, reach out."

We just did a video with him, and it went live. Then two days later, our Instagram page was gone because of something, like we were just talking about, it was the ad that we posted or boosted? Yes.

[00:27:18] Hugh: Did you get that video back on at least or?

[00:27:19] Mark: Oh, yes, we got it back on. It was incredible. The power of some of these people, they can drive some big awareness. If someone like that is talking about your brand, they're going to your website. Our website just went through the roof for literally a week. Yes, it does work. It created a lot of awareness and a lot of excitement.

[00:27:43] Hugh: Wow, that's crazy. Just for back to entrepreneurial side of things, how important, obviously just for everyone else out there who wants to maybe start something is passion? I know how important it is to actually want and need to do something and then as opposed to, "Oh, this is a good idea, let me start it," then six months later, it's just still not there. How important have you guys found that in your startups?

[00:28:12] Av: I guess like some of the work being a lawyer, sitting there and reading, all the reading and writing and all this-- we drink, we drink wine all the time or drink-- have a cup of-- and beer or whatnot. I felt like this is my passion because we drink and enjoy it. [crosstalk]

[00:28:30] Mark: He doesn't sit around drinking though, I got to jump in.

[laughter]

[00:28:32] Hugh: Yes, no one thought that, no one thought that.

[laughter]

[00:28:37] Hugh: Oh, that's hilarious.

[00:28:38] Av: Now you enjoy it a lot more. When we created the drinks, I think there's a lot of passion that goes into the drink. I'll give you an example, today we've actually just created a new mixture, while we were sitting there just a couple-- like an hour or two, we went back and forth and was like, "That's not what we want it to taste like." We're really passionate about it, and the people that we were working with, I think they felt that.

I think it is very important in terms of we want that drink to be correct and make sure the quality there day in, day out in so that there's always consistency. I think there is a lot of passion. It's very important for entrepreneurs to keep that passion. It's what keeps you going because there's always doubts, right? You're like, "Oh, shit. We're about to run out of money," or, "Shit, we don't have enough product today," or, "We can't sell enough product." If there's something that keeps you going, that's usually passion.

[00:29:34] Hugh: Yes, 100%. Yes, if you don't have it and you're just getting beat up, you're like, "I quit." It's just that simple. You really just got to want to do it. That just made me think, so every drink that you guys have come up with, is it made from you two, or do you guys hire some--?

[00:29:48] Mark: Yes.

[00:29:49] Hugh: It's made from you two?

[00:29:49] Mark: Yes, it's from us.

[00:29:51] Hugh: There you go.

[00:29:52] Mark: Like I have said, we were passionate about the taste so much that we wanted to make sure it tasted great. We didn't want to just have a one hit wonder, we wanted to make sure that all of our products taste great. You'll see some companies, they'll create a product with great branding. The product doesn't necessarily taste great, but they've created something that makes good money, so they keep creating the same stuff. It has to be a passion more than just for the dollar bills.

[00:30:17] Hugh: Bud Light just makes me think of that.

[00:30:18] Mark: Possibly, yes. Exactly.

[00:30:20] Hugh: I can say that.

[00:30:23] Mark: We thought it was funny with the seltzers how a lot of great beers that we love all of a sudden became seltzers. We were like, "You're a great beer. Why are you putting your great beer name on a seltzer?" That didn't make a lot of sense to us. It showed where their passion was, their passion was creating something, go mass market, make the money, and leave. Where we wanted to create something that was different, and we're going to constantly scale it that way and be a little different. I think some of the big brands like Amazon and Apple carry that same model as well.

[00:30:52] Hugh: Really?

[00:30:53] Mark: Yes.

[00:30:54] Hugh: Something to aspire to right there for you guys. [crosstalk]

[00:30:56] Mark: Exactly.

[laughter]

[00:30:57] Hugh: I haven't been home in quite some time, a few years, and since, obviously, we were talking about how Australia is so big on mixed drinks, that was my first entrance into, "Holy hell, there's all these mixed drinks, and this is great." Is it been introduced more into US and Canada, or was I just missing that out my entire life and I just didn't know? It seems like a newer thing that I've noticed only from being in Australia.

[00:31:24] Av: I feel mixed cocktail drinks, they were out-- I believe-- because the rules are a little bit more relaxed in Canada, and they probably came up there first. Then now they started to pick up-- I think I read something about how mixed cocktails in Canada, they bought 20 million cases last year, which is a pretty fair number, but there's still a lot of room for growth and improvement as well if you compare that to even the seltzer market or the beer market.

I think there's still room, but it's growing in the US for sure. You're probably right because the rules towards spirits-based RTD are probably more relaxed in Australia, and that's why it started first there, the same situation in Canada as opposed to the US.

[00:32:04] Mark: Av and I have worked with a lot of Australian brands too, and I think Australia is just full of innovation and they support it there. Their government fully gets behind entrepreneurs that are starting up businesses, so that helps. If your country is really supporting creativity and innovation, you're going to have some cool products before everyone else.

[00:32:23] Av: In the US, they still have rules that date back to the prohibition in some of these states. They're a little bit slow on that drink side, in terms of regulations.

[00:32:36] Hugh: I had a question that I was going to ask earlier that we ran away from. What is the least sensible red tape rule that you guys have to abide by that seems to either annoy you the most or just have no benefit to you guys or the consumer? Is there one?

[00:32:53] Av: It's the state by state I'd say.

[00:32:55] Hugh: They're all crap.

[00:32:56] Mark: There's some really bad rules. I think the worst is probably the grocery store one, that some grocery stores can carry a beer, a wine, and a malt-based beverage like a seltzer, but if you have a 5% of vodka or rum in it, you're not allowed to sell in that grocery store. It's all alcohol at the end of the day. Even wine, there's 12.5% alcohol in a bottle of wine, but because ours is made with vodka or rum, we can't be in that grocery store. There's some interesting rules like that throughout the States and Canada. I think it's cool that we've got a product that's on the forefront of some of those changes, so that just makes more opportunity for us in the future.

[00:33:42] Hugh: That just also reminds me of how restrictive Australia can specifically be, especially with the markups and ridiculousness of the prices of alcohol over there. Is that another reason you guys are maybe putting that on hold for the moment?

[00:33:56] Mark: Yes. To go overseas, for sure. Recently, we found out that Quebec has a certain price that they want to stick with in Canada. There's different rules. Sometimes you're priced out. There's no way you can create a product and meet the needs of that state or that country so that it's remotely profitable. It's great to be everywhere, but if you can't make money everywhere, it's tough to run your business forward. That's a big part of going overseas too.

[00:34:23] Hugh: You guys seem to have destroyed this question before I even ask it. When you guys were creating this business plan, how much and how long away had you planned, and has it been difficult sticking to that plan? Obviously, it doesn't seem like it.

[00:34:37] Mark: You can roll with that one.

[laughter]

[00:34:40] Av: Just to clarify, before we started from like prototype, writing on a piece of paper, hey we’re going to create CoCo Vodka, I think it was about until when we had the finished product, a year and a half, two years old almost.

[00:34:49] Mark: A year and a half, yes.

[00:34:50] Av: A year and a half where we thought it would be six months to a year and max from prototype. We got it and then we thought the minute we had product we'd distribution but that was definitely not the case. It took about six to eight months, even a bit longer to get that distribution together. All our timelines are still-- Now I feel like we're succeeding our timelines, but there's still things that we have in the pipeline which we pushed off just because something is more important. Again, distribution and getting the scale it’s just a bit more of a priority than--

[00:35:28] Mark: Logistics, shipping.

[00:35:29] Av: Maybe launching another SKU or something along those lines, just because the SKUs that we have are doing pretty decent right now. Then where there's also issues, like Mark was just saying right now, with logistics shipping, getting cans, supply chain is a nightmare for everyone right now in the industry.

[00:35:49] Mark: Yes.

[00:35:50] Hugh: Yes, thank you pandemic.

[00:35:52] Mark: Yes, the pandemic didn't help. One of the funny things we learned the hard way was shipping product across the US and Canada in the wintertime. You don't think about how the fact that you have to put this on a truck and it's cutting across maybe the northern US and you need freeze protection. Your shipping costs are almost double in the winter because you got to make sure that these cans are all wrapped with blankets. There was all these other extra expenses that we didn't anticipate because we were so new in the business, but we learned, like we said, real quick. Now we know when to ship. To actually think that you should consider the time of year that you do most of your shipments is crazy.

[00:36:31] Hugh: Oh, really? That just means don't ship in the winter to blanket your cans, just ship earlier or more in summer kind of thing?

[00:36:38] Mark: Yes. Well, and then if you are planning on pre-stocking a bunch of states or provinces, that that's going to be an extra a couple of thousand dollars of shipping fees that maybe you didn't anticipate.

[00:36:49] Hugh: Geez.

[00:36:50] Mark: Yes, wild, right?

[00:36:51] Hugh: Yes. Speaking on that whole logistics things, where do you guys source, not only the ingredients, but your cans and all that stuff? Where does that come from?

[00:36:59] Mark: This is the crazy part about these products. We get stuff that shows up from all over the place. Our cans are from the US, both for Canada and the US are all made in the US. There's really only two large can companies that make cans, bottle, and crown; we use both of them. Our coconut water comes from the Philippines, our vodka is made in New York and Toronto. Our rum comes from the Caribbean, we actually bring it in from Puerto Rico. Our lime juice comes in from California, and our pineapple juice comes from Indonesia. It's a real global product. Our trays are made in both Canada and in the US.

[00:37:36] Hugh: Your trays?

[00:37:37] Mark: Yes, cardboard trays. Most of them come from the US still, but there are some four-pack trays and pack texts that we use that come from Canada too. Logistically, it's wild.

[00:37:49] Hugh: Were you guys thinking about sourcing, not organic, but you know what I mean? Kind of good sources? What was the thought process going into that?

[00:37:56] Mark: Yes, we knew quality was most important because we're consumers, we know that we know what's in all the products now. We're more aware than we've ever been, so quality has always been number one. What we do is when we get the quality product that we like, we try to do volume discounts, negotiate longer-term contracts with them. Yes, we never wanted to sacrifice the taste or the quality.

[00:38:19] Hugh: Yes. You guys have done an excellent job with that, just a side note.

[00:38:22] Mark: Thank you.

[00:38:25] Hugh: Well, I know you guys have been taking up a lot of your time here. I really appreciate you guys taking time out of your day to come on the podcast. I do have just one or two more questions for you. This one is quite intriguing to me. How willing in today's environment are you to use debt financing? I know that some people love debt and some caution against it, but is it something that in today's environment with such low rates and future potential inflation that you're using to fund growth? What's your mindset there?

[00:38:55] Av: We started off with debt financing. We had a brand new product, no sales, and no one wanted to fund us. We had Walmart sitting at the table in Florida and we had a few other distributors. That's like we were about to launch at 15, maybe 10 states, Mark and I self-funded everything before that, but we needed to get some funding out the doors. We technically really had no sales at that time.

[00:39:19] Hugh: That's always fun.

[00:39:21] Mark: Yes, you get this great product and great idea, but--

[00:39:24] Av: Yes, we started with debt financing. We did get equity release. That's what got our feet on the ground and got us running. We're thankful for that, that's someone's willing to give us some debt with no sales and a brand new product to some guys who've never a new product. We're pretty happy about that. We're all for it, you got to get things started and start the runway. Now that were off to the sprint, now we have to look at the bigger picture and see how else we can raise money.

[00:39:55] Mark: Yes, strategic partners and celebrities. There's a few other paths we're taking for future finances.

[00:40:03] Hugh: Kevin O'Leary,

[00:40:04] Mark: It's a great way to kick-start it. That's right.

[00:40:06] Hugh: Yes, right? Well, okay. Guys, this has been amazing so far. Again, I don't want to take too much of your time. Before I give you a handle of where people can find you or your information, I do have a question that I always ask people that I have coming on the show, and it usually throws them for a loop. What is, and I want both of you guys to answer this, if you will, please, the best advice that you've learned in the entirety of your life? If you had to narrow it down to one thing, what would you say to that person to give them advice?

[00:40:37] Mark: It's a great question. There's so many different things that you could say to that. For me, I think just have focus. If you love something, focus solely on that and put all your time and energy behind it, and it will become successful. As long as you love what you do, you love what you've created and you put that laser-like focus to go get it, you'd be amazed what you can create and do with limited resources and limited experience as long as you're laser-like focused.

[00:41:15] Hugh: Nice, I like that. Av?

[00:41:17] Av: For me, it's more of—yeah you were right, you did kind of throw me there. [laughs] [crosstalk]

[00:41:22] Hugh: I know. I just usually cut that part of the episode because people would just pause for a good minute or two. They're like, "I have no idea."

[00:41:29] Av: Yes, it's like how many things can we come up with, because youre just trying to think of—but just persistence. I think persistence is a big, big thing because things are never going to go perfectly, they're never going to go the right way or as you planned. Nothing ever goes as planned. whether it's life, business, or whatever it is, you just got to keep persistent, keep at it. That goes back to what Mark says, just focus and if keep focusing there, you got to keep with it. Your passion on it, you will make sure persist towards it.

[00:41:59] Mark: You'll either find a way or find an excuse, is what we always say around CoCo.

[00:42:04] Hugh: Find a way or find an excuse. That's better than fake it till you make it.

[00:42:09] Mark: That's it.

[00:42:10] Av: We don't recommend that.

[00:42:10] Mark: We don't recommend that.

[00:42:12] Hugh: No. All right. Well, guys, thank you so much for coming on the show. Mark, Av, it's been a blast. Can you let people know where to find you, where to get CoCo? Anything like that?

[00:42:23] Mark: Best is obviously through social, you can follow set enjoy CoCo life, our website's enjoycoco.com. We're really easy to get ahold of. If you're interested in getting to know me or Av a little more, just send us a note through our social media and our creative director will pass it directly to us as well. We're open to talk to anyone, especially other entrepreneurs. I think that's what's great about your podcast too, it's just bringing entrepreneurs together. We're all growing as one, so we'll be stronger as one.

[00:42:50] Hugh: Man, I'm excited for the next 30 to 50 years of what this kind of next two generations can do, especially the way we've come up into where we are now. It should be quite exciting.

[00:43:01] Mark: No kidding.

[00:43:01] Hugh: A little bit more open with each other, if you know what I mean?

[00:43:03] Mark: Yes.

[00:43:03] Av: For sure.

[00:43:04] Mark: Love it.

[00:43:05] Hugh: Cool. All right, Thank you guys so much.

[00:43:07] Mark: That was great. Thanks for having us.

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[00:43:09] Hugh: That wraps up another episode of Thoughts of a Random Citizen. If you guys have a question for the podcast, head over to toarcunited.com; it's in the show notes, and you can record a question. Feel free to email us if you don't want to record a question. On there, you'll also find information about financial advice, travel tips and destinations, broad market analysis, and there's a whole heap of stuff on there for you guys.

If you liked the show, please review, like, subscribe, share with a friend, it goes a long way. As always, these are thoughts of a random citizen for citizens. There are experts that do come on the show, and I always do my best to research before each show, however, do your own research. This isn't advice, this is generalizations, so there is your free disclaimer. Enjoy your week, and I'll talk to you next week on Thoughts of a Random Citizen. Cheers.

[music]