A Thrist for Change: Kara Goldin’s impact on the beverage industry

Transcript

Lauren Stenger: Today Kate and I are speaking with Kara Goldin, the CEO and founder of the uber successful beverage company Hint Water. Hint was started from the kitchen of Kara’s home in 2005 in the search for an alternative to diet soda. Now, Hint Water is one of the biggest beverage companies on the market. In addition to running Hint Water, Kara is the mother of four children. She runs her own podcast, the Kara Goldin Show, and she recently launched her new book, Undaunted, Overcoming Doubts and Doubters. We had the best time hearing all about Kara's journey.

Lauren Stenger: Thank you so much for being here, we are so thrilled to talk to you about your journey with Hint. We want to take it back a little bit to when you were our age. What were you like as a teenager? And did you have like an entrepreneurial mindset back then?

What were you like as a teenager? Did you have like an entrepreneurial mindset back then?

Kara Goldin: Well, thank you for the introduction. It's always fun to look back because I think that it's easier to see that I was definitely very entrepreneurial. I grew up in Scottsdale, Arizona, and I was the last five kids, so I felt like I was automatically independent. My parents were sort of like, okay, figure it out, you have lots of brothers and sisters who could have showed you the way. I got my first job, outside of babysitting, at a toy store when I was 14 years old. And I talked about it in the book that I had no idea, I just wanted to make money so I could go to the mall. But it was a great responsibility that I was able to go to a few toy shows to actually do buying; I learned about margins. I was learning early on. And I think more than actually defining myself as an entrepreneur, I feel like I was always really curious, and I was always really willing to show up and learn. Even when my friends weren't working when they were 14. I just really loved it. I really enjoyed the aspect of learning. Back then, I felt like learning only happened in school. It didn't necessarily, maybe you learned a lesson along the way. But for me, just actually getting out there and sort of living my life, I would always look for opportunities to learn along the way. I started a kid's camp actually; my friend reminded me on social media a couple years ago that my first job was not at a toy store. I started a camp when I was 12 and figured out to charge kids to come to my camp. I wanted to build a little city with a bunch of paper towel boxes that I got at the grocery store. And my friend Robin said, how much are we going to charge for people to come to the camp, and I'm like $5. She's like, how do you know that's the right price? And I'm like, I don't but let's just put up a sign that says $5 and we'll see if it works; and it did. After a few weeks, we got bored and we decided we wanted to enjoy our summer so we quit. Everybody was bummed out that we quit and they wanted to pay us more money. And we were like, no, we want our summer we don't really want to do it. I mean so many things in times like that, where I look back on and definitely it was there. But more than anything, I wanted to be a journalist. I graduated from college and I wanted to work in journalism. Fortune Magazine was a magazine that I really enjoyed because it taught me about finance. When I went to college, I didn't really understand numbers. I kind of barely got by and a lot of my classes as it related to numbers were really challenging for me. When I ended up taking some finance classes in college, I remember going up to my teacher and saying, I just feel really stupid and how do I catch up, and how do I figure this stuff out? That's when he shared with me that I should get a subscription to The Wall Street Journal and also to Fortune Magazine and just start reading and just keep asking questions along the way. And that's what I did. So after college, that was really what I wanted to do. I wanted to work for Fortune. And one of the things I talked about in the book, which I highly recommend you and others get a copy of it, I've spoken on a ton of college campuses and high school campuses about my journey overall. But I think for me, it was looking at a place that really helped me to learn and made me curious, and that I felt like I could look back and think I didn't understand any of this. I started reading more, and then I understood it. And whenever you do that, whenever you kind of face your fears and go and challenge yourself, and you're like, Well, yeah, it seemed really hard. But then I figured it out. I thought, if I could do more of that, then that'd be super cool. And that's where I should go. So I went to New York because that's where all the magazines were based out of. And I looked in the masthead, inside the magazines, I'd never been to New York. Anyway, that's when I never got a job at Fortune Magazine, but the sister company to Fortune Time magazine. I got an offer there, so eventually, maybe I'll get to go over to Fortune. That never happened, but I enjoyed my time at Time. Then I was recruited out of there to go what would be termed today as a late stage startup that is called CNN. It was an incredible opportunity, I mean, it was just starting out. And this is when, you know, it's so funny to think about it. But everybody was telling Ted Turner, the founder, that people don't need 24 hour news. And now I mean, you just can't even imagine, right, and, and so yeah, so that was that was kind of the beginnings of my entrepreneurial journey, but also thinking about, you know who I was as a high schooler and into college.

Kate Stenger: Jumping forward a little bit, how and why did you start Hint?

How and why did you start Hint?

Kara Goldin: So I started my career after college and journalism. I met my husband in New York and we moved out to San Francisco together. It was his idea, he really wanted to get into technology law, I think, you know, when he met me, I just always wanted to have a lot of fun. And I didn't understand why I couldn't have fun and also work with people that I enjoyed, but also really enjoy what I was doing. And so it just, it was just this epiphany that went off in his head that he thought, you know, it wasn't just about going and working on Wall Street and being a lawyer, maybe he could do that, but also do something that he really enjoyed. He really enjoyed technology. He decided he didn't want to go to school to become an engineer, so when he went to law school, he thought maybe there's a way to actually tie those two my passions together. I didn't know him in high school, but he was probably a super geek in high school and loved all that kind of technology stuff. And so we moved, so he ended up getting a job offer with a firm in San Francisco that was doing technology law. He was very quickly recruited out of there to go to a technology firm in house, probably a year out, which is almost unheard of, because you just really got this stuff and doing intellectual property. So he went to a company called Netscape. And, when he went in house counsel at Netscape, they didn't even have intellectual property attorneys. And so he was one of the first intellectual property attorneys. I was trying to figure out what I wanted to do, having left CNN at this point. I didn't really want to work in a satellite office because I felt like all of media was really at that point done in New York. So when I came out to San Francisco, that's when I was I thought about, okay, what do I think about San Francisco? Like what industry is here? And Steve Jobs was the person that I thought of when I thought of San Francisco again, not having grown up here. And I couldn't really fathom why Apple would hire me because I wasn't an engineer, I didn't know enough about it. I just thought, I don't really have kind of what they want necessarily. I thought, oh, Apple, they must want a bunch of engineers, but that's not necessarily true, certainly not today. But that's what I thought. So I instead looked up, I was looking up Steve Jobs. And I looked up this company that had incubated inside of Apple that I thought was super interesting. These five guys had left Apple to start kind of a spin out of the Steve Jobs idea. Basically Steve had this incredible idea to take catalogs and put images on a disk. So that was like the mid 90s, and I thought, this is really incredible because if you don't actually have to use data to get images, then it'll be much faster. So I reached out to these people who had started this little company that I had all worked at Apple, and for Steve. And I said, Hey, I really want to, I just moved to San Francisco, I'd love to work for you. I cold call them. And they said, Well, what's your experience? And I said, Oh, I worked for CNN. They're like, you worked for Ted Turner? And I'm like, No, not directly. I mean, I worked indirectly for him and. They said, Oh, let's have coffee. That's so cool. And here I am thinking that they worked for Steve. And were both like gaga over each others work experience. And so that's when they said, Hey, maybe you could go out and do sales for us and go up to these catalogers. I'm like, Okay, I mean, I didn't know anybody. So I was like, I mean, what's the worst that can happen? I'll quit if it doesn't work out. And so I took that role. And then one of our investors was this company called America Online. And America Online acquired us. And they said, We'd really like for you to stay in the acquisition, Kara. And will you run this thing called shopping? And I'm like, Yeah, I mean, why wouldn't I run shopping? I mean, I love shopping. I love catalog shopping. So all I was doing all day long, was meeting with J. Crew and LL Bean. So fun, right? I mean, people were like, what experience? Have you ever been in retail? I'm like, No, eventually, they'll find me out that I have no idea what I'm doing. But I don't know, it's really fun for now. And anyway, I was the youngest vice president at AOL. I was one of the few women and I'm living in San Francisco. I'm commuting all over the US meeting with all of these people. I'm never home. Seven years later, they went from zero to a billion dollars in revenue for AOL. And I was running this business. I mean, it was just crazy on so many levels. It was just shocking, it was magical, I mean, it was just weird on so many levels. After seven years, I was starting my family and had three kids at this point under the age of four. And I thought, You know what, I'm going to take a break. I've never taken a break. I was redoing a house in San Francisco. And I thought I'm going to take a break and see exactly what I want to do next. There's all these tech companies that were starting up in the early 2000s in the Bay Area and that's when I thought while I'm taking a break, I'm also going to get healthy. And I obviously I think a lot of times when you're a parent, you're you're looking at what you're putting into your kids bodies much closer for me than I had ever looked at ingredients. And I was also trying to lose weight. I was I had gained a bunch of weight over the course of having kids but was terrible at losing weight. And again, really busy with work, so I just hadn't really focused on it. And I thought, this is the time for me to do it so that I could stay healthy for my family. And that's when I started dieting, and I had never dieted before in my life, and I realized what a racket it was and how confusing it was. Everybody had differing opinions when I asked people what worked. I did all this research, but I just couldn't figure it out. It was just this puzzle to me that nobody had an answer yet, people were spending billions of dollars on the diet industry. One day, I looked at my drink after kind of giving up on the food because I thought, I'm not really eating that bad. I was exercising and doing all these things. I looked down at my diet soda, and my Diet Coke in particular, and saw all these ingredients that were in the Diet Coke. And I thought, wow, I don't even know what I'm drinking. And you need a PhD in science to really understand this stuff. I decided to set it to the side to just see if it would make any difference by just giving it up, I thought maybe it would change something, but I didn't think that it would change what it ultimately did. Two and a half weeks after just giving up the diet soda and drinking water in exchange, I lost 24 pounds. I wasn't changing anything else about the food. Also, I had developed terrible adult acne, when I was your age I never had it. It bothered me and I tried all these creams and went to dermatologists. It was just frustrating. So finally, that's when I made the shift. My skin cleared up, my energy levels increased, and I lost all this weight. My curiosity just really was ignited. Why is this, and why don't more people know about this. If more people knew about the fact that maybe some of these chemicals that you're putting in your body from things called diet are actually doing the reverse of what you wanted them to do. If more people knew that, then the diet soda industry wouldn't be so big, and diets as a whole wouldn't be so big. All these people who are having these varying diet things. They're they're having healthy perception versus healthy reality. And why don't they know about this? And so that's when I thought, Well, the biggest problem though is is that people don't like drinking water. And so I don't like drinking water. And that's why I drink Diet Coke. And so that's when I thought, How do I get over that hump? And then I started slicing it fruit and I threw it in water. This is 17 years ago. And I would share this with friends. And then it got to be like, I finally met people in San Francisco. And people would say to me, wait, do you have cherries in your water? That's such a great idea because you're flavoring the water. Then I'm thinking Are these my friends that are you know, like questioning, like, Yes, I have pomegranates in my water and yeah, that's how you flavor things. It seems so obvious to me. But little did I know that what I was doing was actually something that was really unique. When I went to the grocery store to actually find this product which was just water and fruit everything had sweeteners in it. It was just flavorings and it had either sugar or it had diet sweeteners. I didn't want to trade my Diet Coke addiction for flavored water that had these sweeteners in it. There was this new drink that was on the market called Vitamin Water. And at the time, they didn't even have a diet version of, they had full sugar. And I remember saying to a friend. At that time, it had more sugar in it and more calories in it than a can of Coke. No wonder it tastes so good. That's when I realized that it wasn't just things called diet, it things that were called, like vitamin, and things that just had this like healthy halo to it that weren't healthy at all. And so that was like the beginnings. And again, I fully thought that I was gonna go back into tech, I was taking a couple of years off, but when I saw that there was something that I had seen so clearly, that I thought I could help a lot of people by taking this product to market, that's when I thought, I'm gonna just go and try and get this product on the shelf at my local store. And, you know, then I'll go find a job. I remember people saying, well, what if it doesn't work? And I thought, well, then I'll go find a job. I mean, then I'll find a job in tech. But for me, I thought, maybe I'll just try and get it on the shelf. And then if nobody likes it, I’ll like it, and I'll have a lot in my pantry. And it'll be great. And I'll give it to my friends. But little did I know. I mean, today hint is the largest independent nonalcoholic beverage in the country that doesn't have a relationship with Coke, Pepsi, Dr. Pepper, or Snapple. In addition to launching a product on the shelf, we also launched an entirely new category called unsweetened flavored water. And it's really the journey 16 years later, for any aspiring entrepreneur out there, I always say, being an entrepreneur is a lot of fun, it's a lot of work, it takes a lot longer than you ever think that it's going to. But I think for me, it was always about purpose, it was about helping create health for people and change for people. And having the background that I did coming from a different industry, which is something I talk about in the book is actually super helpful. I could look at it with a totally different lens than maybe, you know, having started at Coca Cola, or Pepsi. I had no idea what I was doing, but I was also used to not knowing what I was doing, and jumping into industries with my curiosity, and trying to just keep building the puzzle. And so that's how Hint started.

Lauren Stenger: That is so amazing. Such a successful company. But I know with every success, there's also lots of failures that happen.

What is your favorite failure with Hint Water, and what has that failure taught you?

Kara Goldin: So one of the stories that I chat about in the book is when we got into Starbucks. When I looked at our timeline, that was definitely was very exciting. We had a big celebration that night when we found out we were getting into Starbucks. And it took about six months in lots of meetings in order to make that happen. We were going into almost 7000 stores throughout the country. That's when I remember saying to our buyer, so what does success look like? Because I want you all to be really excited to be in here and partner with you again. When you look at that little cold case that they have, right when you walk up to Starbucks, there's not very many beverages in there. So we felt really lucky. And by the way, there's over 2000 beverages in the US today. You know, most people can only name 30. So it was a very exciting time to be able to get in there, and I said I want to stay in here. So what is success and they said, Well, if you're doing one and a half bottles per store per day, then you know you're killing it. You're doing terrific and I said okay, so I have my goal of one and a half bottles per store per day. That took us six months to achieve that. And, and then it just kept going up and up and up. After a year and a half, we're doing three bottles per store per day. So I'm very confident, very excited, we worked so hard to make sure that that partnership was working. And then we got an email saying they needed to talk with us. And I said, Okay, you know, we're doing great, so no worries at all. And they said, the person left and we've got a new buyer, and the new buyer said, I have some really bad news for you. And I remember joking around thinking can't be that bad. I mean, we're doing three bottles per store per day. So just tell me what the deal is. And she said, Well, unfortunately, we changed strategy, and we're going to be pulling some of the brands out of the case that are not Starbucks brands because we're going to be bringing in sandwiches and some higher margin businesses. So unfortunately, in two weeks, we're discontinuing you in 7000 stores. So I have all this inventory, we have investors, I'm super screwed at this point, because I had completely been planning on this and thinking I've been doing such a great job. I had no other options, and I've got this inventory that's going to go bad. So I don't cry very often. But I cried thinking, Oh, my God, this is terrible. And I remember looking at my team and saying, I just wish that I could reach out to all of these customers. But I don't have any names, right? We don't have any emails, we don't have any data because Starbucks has all the data. And in many cases, they don't even have emails because people are paying like cash or they're paying by credit card and they don't have the data. So it wasn't sure what I was going to do, how I was going to solve the problem around the email the inventory overall. And that's when I got another email from another Seattle company, Amazon, and Amazon was launching their grocery business, and the buyer said, I buy your product every morning when I buy my coffee at Starbucks. And I'm thinking, Should I tell them that we're getting kicked out of Starbucks. And so he said, how quickly can I get some product? And I said, Well, we had an overrun of our blackberry water, so I can send a truck today, if you want to wire some money. And he said, Sure. That's great. So that happens, we become one of the number one product in Amazon Grocery. After a year of working with them, that's when I said to him, Hey, so, you know, what do you think? I mean, how are we doing? And he said, Oh, my God, you guys are doing amazing. And you know, what else is really interesting about your product is that the people who are buying Hint are also buying things like diabetes monitors and things that are definitely saying about the customer, that they're really trying to get healthy or stay healthy. And I said, Oh, that's really interesting. Would you mind giving me some of their emails, because then I'll reach out to them because I'd love to know more about these customers. And he said, Jeff Bezos won't give you the emails. I mean, there's no way I could give you the emails. And I was like, but that's my customer. And he said, That's not your customer, you sold us the product, and now it's our customer. It was at that moment when I thought, you know, if I want a relationship with my customer, then I need to sell direct to the customer. Otherwise, that's how I got into the situation was Starbucks. He said to me, does Whole Foods or Target, do they give you customer data? And I said, No, but and he said, Well, we're no different. I mean, we are absolutely not different at all. The only differences is that we don't have a physical storefront, and it was that moment when I thought there are so many lessons here. Number one, in the situation with Starbucks, if I would have not put all my eggs in one basket. I had put so much focus on making sure that Starbucks was going to be terrific that I didn't think about what would happen if I was discontinued. So putting all my eggs in one basket made me very vulnerable. And, it's something that I share with entrepreneurs all the time, just huge lesson learned is that, you know, never put all your eggs in one basket, always have choices, because you never know, if they're going to discontinue you, maybe they're gonna go out of business, you know, you never know what's going to happen on the other end. The other piece of it is that if I would have had a relationship with the customer than I would have been able to share with the customer, that we were still available at other stores. While Amazon solved my immediate problem of inventory, they still had my data. That's when I decided to launch our direct-to-consumer business at drinkhint.com and build up a relationship with the consumer people said to me, when we launched drinkhint.com, they're like, why are you doing that? Isn't Amazon gonna crush you, they could totally beat you, whatever. And that was never the purpose, the purpose was to have some sort of relationship with the consumer, which, fast forward almost eight years now, over 50% of our business is on drinkhint.com. And so again, all these failures along the way, or it's hard for me to call them failures, more than anything, challenges, lessons. Looking back at those times that were really challenging, it's so hard sometimes when you're in it, to actually realize, what is the purpose of this? Like, what am I learning here that I should be taking from it. More than anything, it's also recognizing that you don't stop. You don't stay complacent, just because challenging times are happening, you have to figure out a way to continue moving forward. When you continue moving forward, sometimes it's easier for you to look back and see what the purpose of that time was, and why you were there, and why that was inserted into your life. Something I've shared with people just pertaining to my book, it's, I turned the book in the manuscript right before the pandemic. And there were still times that I've had over the years, the 2008-2009 financial crisis, which was really, really tough being an entrepreneur during that time. And I remember just being really nervous and learning a lot of things and wanting to forget about a lot of things. But when the pandemic hit, I kept thinking about some of the hard stuff, and if I would have been able to sort of do things a little bit differently during that time, then I wouldn't have gotten myself into the position that we did with almost losing the company. So that challenging time of 2008-2009 actually helped me to move very quickly, in the beginning of the pandemic, and we went out and raised money. We definitely made sure we had enough inventory, all these things that happened because of other challenging times, and times that I wanted to forget. But more than anything, I think the story is really, you know, take your hardest times and sometimes sit there and think about how could I have changed things, maybe you couldn't have changed things, right? Maybe people are looking at the pandemic and saying it was just awful, and so many issues, but how do you look at those times and say, what did I learn from them? How could I have been less vulnerable? How could I have challenged the wave a little bit differently in some way. And I think that that's the most important piece of it.

Lauren Stenger: That's great advice for everyone, you know, not just entrepreneurs. So thank you for sharing that. One of the things I really admire about Hint is that it's led by a female entrepreneur. And I'm assuming you face some difficulty because it's hard to be a woman in the business world, so what are some difficulties you faced? And what did that teach you?

What are some difficulties you have faced as a woman CEO?

Kara Goldin: So, you know, people have always asked me if its harder to raise money as a woman. And I mean, I've never been a man. So I have no idea. I think there's stuff that is tough to do. But I think if you focus on the things that you perceive as too hard or impossible, then that's not helpful to you. That's not going to help you achieve what you want to achieve. And so I'm not saying that you don't recognize it. I'm not saying that it isn't true. I'm just saying that you have to figure out what you focus on because if you focus on things that just make things too daunting, then that's going to prevent you from moving forward and making it happen. And so, have I had to call on more people to raise money or work that much harder? Probably, I don't know for sure. And instead, I think, you know, I have raised a lot of money. It's very rare for a founder to still be the CEO 16 years later, especially a female founder. What I can do is do and stand up and really show people that it can be done instead of focusing on the negative stuff. And again, I think that it's, you know, we need more. But I think often times, when people hear the news that it's so hard, and the decks are stacked against them. That tends to eliminate a lot of people from even trying. And so one of the reasons why I call my book Undaunted, is that I talk about being undaunted is a choice. It's a decision that you make to live a certain way, you don't allow things to block you, instead you figure out how do you get over them. How do you get around them? How do you how do you listen, but then figure out how that won't be you. I think that is such an important message, not just for girls and for women, but for everyone, because everyone has fears everyone has challenges along the way, everyone has failures, even the most successful people. But you have to figure out what those things are, what did you learn from them, and figure out how to move forward?

If you could give one piece of advice to a young entrepreneur, what would that piece of advice be?

Kara Goldin: I think more than anything, it's figure out what you're really interested in doing. There's so many choices in the world. What are you really interested in? What are you super passionate about? So often people think instead about what everyone else is doing, or how do I get a badge, whether that's going to the right school, or having the right degree, or making a lot of money, whatever it is. I'm a huge believer that figuring out what you want to do, and then try and figure out the rest of that. When you're happy, when you enjoy what you're doing every day, and you're and you're challenged by it. I think that that sets you up for doing really great things. People want to work with people who are enjoying what they're doing and who are learning, and aren’t grumpy, and who are curious about something. Unfortunately, when you're not interested in something, then you're not going to be curious, right? You're not going to be very fun to work with. And I think that more than anything else. For me when I was moving from tech into beverage, it's not that I hated tech, it's just that I didn't even know how I got there. I wanted to work at Apple because I thought that the Macintosh computers were cool, but I didn't need to know how they worked. I just liked using them. Right? And that's as far as I got. But for me all the sudden I became a great tech executive. And I thought I got there kind of by accident, and I'm a smart person, why don't I just keep going on my journey and figuring out other great things that I can be doing. I think that that's how people need to think about things rather than thinking about, okay, I get down with school, I get a job, I become a manager, I become a director, whatever it is, because that is not where happiness starts. More and more, when I think about mental health and depression and I think it's like, if you had to start somewhere, think about where you're spending a majority of your time. And if it's being in an environment that is not really conducive with how you want to live or what you appreciate or you know. Being in a job, the same thing, you're spending hours in this role and you're not even interested at all in that, then, you're really probably working against the grain of who you are. And I think that's such an important piece for everyone to recognize.

Where do you see Hint water in five years?

Kara Goldin: Getting more and more people off of diet sweeteners. For me, I started this company to help myself drink water, because I didn't like the taste of water. And I think if anything good came out of the pandemic, it's that more and more people are focused on their health. Nobody wants anything to do with this virus. Everybody wants it to just go away. It's very, very clear to me that health and wellness has just accelerated in the last year and a half. So I think that we will continue on our quest to really help people achieve that. And that's where I see us.

Lauren Stenger: That's amazing. Well, thank you so much for being on our podcast today. I learned so much from chatting with you.