Deep Dive
Shownotes Transcript
I'm Yasmin Gagne. I'm Josh Christensen. And this is Most Innovative Companies. On today's episode, Fast Company contributing writer Clint Rainey on Boeing's disastrous 2024. I don't really know exactly what more incentive it needs to make substantive change than to see its stock price take a serious hit.
Gia, founder and CEO, Melanie Mazur on the alcohol-free spirit market. Our competitors in this space are the people we're taking market share away from, and we're definitely taking market share away from alcohol. And as always, keeping tabs. Do you want a baby octopus?
might have to refloor your home. But first, here's the download. The news you need to know this week in the world of business and innovation. Donald Trump's media and technology group stocks continue to decline. Oh no. Boo. Sad. The company went public a few weeks ago via SPAC merger. It
It doesn't matter. You don't need to know what that means. They went public through a weird means. We did an episode on it a few weeks ago. Listen to that. So they went public a few weeks ago. And the most recent drop, there's been some precipitous drops since they went public. But the most recent one happened this past Monday when shares opened down 15%. The drop is likely due to two factors. One, the company announced that they'd be issuing more shares. I'm laughing because the second part is...
Yeah. Kind of crazy. We know what's coming. One, the company announced they'd be issuing more shares. And two, as I'm sure you all know, Trump starts his first criminal trial this past Monday. One of three? I think there's three criminal trials. I don't know. Look, there's a bunch and he's guilty. Yeah. Yeah.
We all know. He already owes like half a billion dollars somewhere. So he really needed these stocks to stay high. Meta's platform oversight board is reviewing the company's handling of AI-generated, sexually explicit images of two female celebrities. These deepfakes circulated on both Instagram and Facebook. The incidents will be used to assess the overall effectiveness of Meta's policies and enforcement practices...
around pornographic fakes made by AI. There's no chance whatever they're doing is going to work. Yeah, your most problematic male friend's going to have some really upsetting opinions about this, I'm sure.
It was tax day this past Monday, and according to the latest IRS statistics, the average income tax refund this year is $3,011. This is an increase of $123 from last year's average, which is pretty good. That's not too bad. That's about half of a month's rent in New York City. Two-thirds the $3,000, not the $123 number.
Two-thirds of taxpayers are expected to receive a refund. The IRS is claiming that the increase, along with faster refund delivery, is due to customer service improvements funded by the Inflation Reduction Act. So, thanks, Obama. Thanks, Obama. And didn't the IRS launch, like, a free-file service so that TurboTax could stop scamming all of us? Yeah, they did, and it works for a certain number of people. I forget the exact statistics. We covered it before. Yep.
on this show and said how it is also i should know we do know biden's the president we're not like donald trump who seems to be confused about that caitlyn clark the college basketball star has officially been drafted into the wnba the indiana fever drafted clark first overall on monday night together
Ticket prices for Fever games are surging in anticipation. Floor seats on StubHub are going for as much as $515. Yeah, big, big business for the WNBA continues to rise. This is after the Caitlin Clark effect is very, very real. Yeah, it's been interesting to see all the like brand activations around. I think, wasn't she wearing like a Prada outfit or something? Yeah, I think so. I know Glossier did a whole like, we did her makeup thing.
The first person she hugged when she got drafted, not her parents, was Jake from State Farm. This is real. The actor who plays Jake from State Farm. Yeah, I'm dead serious. Jake from State Farm is all over the NBA and WNBA coverage. It's pretty fun, actually. I mean, honestly, yeah, I respect those brand managers are really smart. Yeah, he's there. And Jake does seem nice, but I know that's a carefully crafted image.
And finally, a study from Resume Builder surveyed a thousand hiring managers and found that, okay, I gotta preface this. This might be shocking for some of you. And found that one in three say they knowingly ask illegal questions in job interviews. And they volunteered that on a survey.
Speaking of which, Josh, could you share your age, identity, disabilities, and familial status with me? I could. All of that is protected information, which some people are sharing. But I'll tell you right now, 34, white dude, able-bodied, and I am married with no kids and two Boston Terriers. Damn, are they going to fire me now? If you're hiring me for something, then maybe. JK, I'm not a manager.
I am. And shocker, people who have those identities like me are more likely to ask those questions. So men, shockingly, ask more legal questions. In shocking news, men remain terrible. And that's the news you need to know today.
So, Josh, are you scared when you get on a plane now? Every time. And this was before the news that we're going to talk about. Oh, really? Every time. Yeah, I don't know. I get nervous on planes. I don't like freak out, but it's just like I get reminded every once in a while when you feel a bump.
That you're like, oh, it's just like being in a car. But then you're reminded, wait, the difference is there's just air for 30,000 feet underneath you, not pavement. So and I know all the statistics, but it's just like I'm always going to travel with a little anxiety. Yeah, I love when you say I'm scared of air travel and somebody's like, you're more likely to be killed by a shark. And it's like, thanks so much, Todd. Shut the fuck up. Yeah, sure. I know it's not rational, Todd.
I know it's not based on statistics, but I think it's a perfectly natural response to be flung by jets into the air at 500 miles per hour and just cruise to like, I don't know, Santa Fe at 30,000 feet. I mean, that's a little weird, but the worst part about it, the seats are all too small for me. I'm a large person and that just adds to the whole stress. That's fair. What about you? Are you a nervous flyer or is like the Boeing stuff really gotten to you?
No, I mean, like it's kind of gotten to me, but sort of in a way that I think is it's like a little bit funny and terrifying. But I find like going through an airport is so stressful that I'm just like relieved that I've made it onto the plane a
Yeah, that's fair. And I always like, oh my God, the minute I sit down, I eat all the snacks that were supposed to sustain me for however many hours the flight is. And then I'm like bloated in the air. Your snack choice on planes is honestly horrific. Oh, the salt and vinegar too.
Yeah, that was a bad one for listeners. The family-sized salt and vinegar chips I ate on the way to South by. Yeah, just a little behind-the-scenes moment for listeners here. From that episode that you heard with the three-body problem from South by Southwest, that was after a flight in which Yaz ate an entire family-sized bag of salt and vinegar Lay's.
on the way there. I couldn't feel my tongue anymore at the end. Oh, God, that is so disgusting. So speaking of, Boeing's been in the news recently. Between a door blowing off mid-flight and sudden nosedives causing injuries, the company has been in hot water. We've got Fast Company contributing writer Clint Rainey here with us to explain what's really going on at the company and how it plans to address safety and quality concerns. Hey, Clint. Hey, yes. Glad to be on with y'all today.
Let's start with a bit of Boeing's history. This isn't the first time that the airliner has been at the center of a story about or concerning flight safety. How did we get here? So Boeing obviously doesn't have some sort of monopoly on safety problems. Other plane manufacturers and airlines have them too, have them all the time. In fact, way more frequently than I'm sure we'd all be comfortable knowing about. But that said, Boeing is
is facing a public image problem on top of what seemed to be some very concerning manufacturing issues. You know, like not every time you see steam rising from the wing of a parked plane means that Boeing's production is shoddy and that, you know, it's going to lose a door or engine in flight or something. But the narrative right now is that Boeings are not safe. And that's created a million social media vigilantes in airport terminals. Yeah.
And many of them, I think, are freaking out about non-serious issues. But that's still on Boeing. And Boeing gets to... Do you have a sense of...
how big Boeing's market share is? The number I'm getting is roughly a third of the market, 36%. I'm seeing 36%. It just edges out Airbus, right? So Airbus is big in Europe. Boeing is big here domestically in the United States. But Boeing is a little bit larger. And together, Boeing and Airbus comprise like 90% of the market. You know, the 737 is the most popular plane on the planet.
Well, not reassuring, but you were talking about basically their PR problem and the fact that we've got all these vigilantes out there. I was on a plane to Austin and took a bunch of photos of random parts of the aircraft.
And was like, is this suspicious? I said that to my husband and he was like, no. So I'm like a small scale version of that. Tell me about how you sort of see this problem. Yeah, I don't think that we can blame anybody necessarily for doing that. Like I'm about to fly two and I'm, you know, I made sure I'm not on any of these, even though I'm like, sure, they're going to land just fine. But...
I started looking into some of the backstory of Boeing and realized that regardless of whether these things that people catch and post to social media matter or not, there is a larger underlying problem here that suggests that the company has a problem that it hasn't addressed and for a decades-long problem it hasn't addressed yet. And to me, that is a serious issue. I mean, it kind of requires...
trip back to like the turn of the millennium around the year 2000 and that's when you started to see a lot of people, a lot of journalists and there's even some books that go into this that talk about the corporate culture shifting. In 1997, Boeing merged
merged with another aerospace company called McDonnell Douglas. And McDonnell Douglas was this big military contractor. The business community was thrilled because this was seen as two top aircraft makers that were combining two very different skill sets. You had on the Boeing side, what was seen as like this ace engineering set of skills. And then on the McDonnell Douglas side, they were known as like having really savvy business acumen. And
following that merger, effectively the McDonnell Douglas side took over and Boeing started to pivot away from this strong culture oriented around engineering that was headquartered in Seattle, very similar to like Microsoft also in the Seattle area or Apple, you know, in the Bay area where the engineers and management are kind of working side by side. Like there's this
great story that I think symbolizes the pivot as good as anything. A handful of years later, like 2001, the company announced it was going to depart the Seattle area. At the time, the CEO of Philip Condit, he was a pivotal player in this moment of Boeing's history, explained that they, meaning like the C-suite, were intentionally putting some physical distance between themselves and the engineering side. His quote was about like lamenting the proximity that had
resulted in senior management being what he called inevitably drawn into day-to-day business operations. So basically, they had gotten distracted. Yeah, they had gotten distracted by their closeness to the production plants. And what they did was this press stunt where they didn't reveal what city they were going to move the new headquarters to in advance. Instead, they parked these three planes on the tarmac in Seattle, one for Denver, one for Dallas, and one for Chicago. And the morning of, executives barged
all boarded one flight and it flew to Chicago like in dramatic fashion. And like that was the big headquarters. Yeah. So like in one fell swoop, they basically were like, we're jettisoning 80 years of engineering centric corporate culture and turning towards a company that's going to be run, you know, effectively by finance people, like a bunch of MBAs.
Well, if I know anything about MBAs, they do have aeronautical engineering courses at Orem, I believe. So I want to talk about this past January. There was a 737. It got grounded because of safety issues. Is that the one where the door fell off? Yeah, that was the Alaska Airlines flight that I guess you could argue was the start of all of this present-day mess, though we have periods of
Boeing kind of going through these sections where, oh, man, a lot of planes are suddenly not doing so hot. And like this is not the first of these sort of safety issues that's arisen. You know, I was reading about this earlier. I was reading about the Ethiopian Airlines flight 302, which was a 2019 crash.
Boeing argued in court that the people on the plane didn't really experience any pain and suffering in the final six minutes as it nosedived to the ground because the speed of sound meant that they like wouldn't have felt it or something. And I was like, that's one of the craziest things you could possibly say. Wow. Yeah.
Yeah, I know. That's insanity. Right? That is like a crazy argument. It did pay $2.5 billion in legal settlement with the Justice Department, so I don't think that argument really worked out. But Clint...
How does the recent safety issues that we've seen from January compare to those in 2018 and 2019? I mean, I think the obvious answer is that thankfully nobody has died this time. Right. In 2018, 2019, it was hundreds of deaths, hundreds of them. And for some quick perspective, the last year was actually the safest year on record for air travel. There were only two crashes in all 12 months.
which is a rate of like one crash per 15 million flights. So that seems important to note here. But the pattern that I guess I was mentioning is one that still feels very important because after that culture shift in the 2000s, early 2000s, Boeing did start to have these like weird spates of increased numbers of crashes. There was one in 2005, 2006, 2006.
where a bunch happened all at once, and then the 2018 to 2020 period, that was when things really got bad for Boeing in sort of the public eye. And it had all of these 737 MAXs grounded around the world. I guess the difference is, as you mentioned, now all this can be broadcast on social media. Like, we literally saw...
the photos of that door falling off the plane in midair, right? Right. The social media element is the thing that's the most different this time. You know, 2018, 2019, not that long ago, but yet we weren't quite living in the same world as far as TikTok and Instagram viral fame goes. Like every door ajar or...
like running light that flashes now gets a flood of people recording it for content. Sorry, I guess that sounds like I'm being cynical of content creators and I am somewhat cynical about what they do, but it isn't that those issues are necessarily fine either, right? And it's like you were just saying, as thanks to people with iPhones that we even have footage of this missing door on that Alaska Airlines flight.
flight. No way was Alaska or Boeing going to release that otherwise. And frankly, without that video appearing in practically every news story that ran showing a literal plane in flight with a hole in the side of it, I don't think that we would be where we are right now talking about changes that Boeing claims it's in the process of
trying to make to rectify all this. Do you think Boeing can win this kind of public image war? Or what can they do at this point in terms of damage control? I don't know if they can. I think that they will try. What's interesting to me about that is I don't see much evidence of them ever trying
previously, taking an approach that seems like it would pay the right kind of dividends right now. Every time in the past, they have made claims that the Department of Justice comes back and said, yeah, you lied about this stuff. Here's a massive billion dollar fine. Or, you know, I'm just not sure based on the
Yeah, they've kind of shit the bed. Yeah.
Public image is obviously important, but what can you say about shareholders? Where does Boeing stand with them? So Boeing shares are currently like less than half of their peak in 2019, which was like 425 back in the day for that series of crashes led to the plane
plane groundings. Airbuses have moved in the opposite direction meanwhile. And at this point, Boeing just has too many, whatever you want to say, fires burning internally at once. They are making some efforts to do things they haven't in the past. There was a big leadership shakeup already this year. It's hard to predict how investors will react to that again, because it's just
Boeing has even slow walked the leadership shakeup. For instance, CEO Dave Calhoun isn't stepping down for eight more months. It's not like this is effective tomorrow or something. And meanwhile, he doesn't appear as planning to speak before the Senate like that. They have gone out of their way.
to not be forthcoming, to not be transparent. This week they gave journalists a tour of the plant in North Carolina where the Dreamliners are made, and they just trotted out a bunch of talking head engineers and had them talk about how actually everything's fine. So, you know, I mean, it's... Not suspicious at all. Not even a little bit. Just put a lab coat on someone and tell them to say everything's fine. That's what that sounds like.
And I should also note, you mentioned the Senate hearing. We are recording this on Tuesday of this week. So by the time you're listening to this audience, you will know whether Dave Calhoun has showed up to that Senate hearing or not. One thing that I was going to add that I felt like might be important about the shareholder thing is that the one thing Boeing doesn't have is this sort of Donald Trump or Elon Musk-style fanboy who will basically buy more shares if mainstream media reports that there are problems or
slash crimes or whatever might be going on. 2024 has already been a bad year for Boeing. They reported plane deliveries were down for the first quarter by about half of what they were at the end of 2023. That means it's still delivering planes. And so I don't really know exactly what more incentive it needs to make substantive change than to see its stock price maybe take a serious hit.
It's also like, I don't know, when I think about the scale of Boeing, you know, making 36% or whatever of the aircrafts, we still have that much choice. Like, you know, when you book a flight, how many people are saying like, I will not book this Boeing. I'm going to pay, you know, $200 or go at a really inconvenient time or whatever in order to avoid the 737. I can't imagine that's like a really meaningful amount, if that makes sense. Yeah, totally agree. Yeah.
This episode of MIC is airing, as Josh said, on the same day as a whistleblower is set to testify against Boeing. We should also note this is not the first whistleblower to come out against Boeing. A former Boeing employee, John Barnett, was found dead last month amid a whistleblower retaliation against the company. What can you tell us about these whistleblowers and about the current investigation and their impact on it? Well,
So John Barnett's death, which was ruled suicide, just added a layer of conspiracy theorizing to the whole mess for Boeing, you know, which is also not good for its public image. The idea that it might be knocking off its own employees, whatever amount of that is possibly true, but.
Yeah, we should say we are not saying or alleging that Boeing had anything to do with us. Please don't sue us. Yeah, so John Barnett obviously is not the only one. All of these that have stepped forward have, I think all of them have been engineers who claim that Boeing...
is basically producing planes too quickly and without proper attention to details. Essentially, the thing you don't want to hear the manufacturer of the plane you're about to be boarding is doing. Yeah. If they are true. The person who is testifying this week before Congress is an engineer named Sam Salipour, and the FAA is also...
in the middle of investigating his claims that he made right now about 787 and 777 jets. That includes the Dreamliner. Dreamliner is a 787, which is sort of Boeing's flagship giant plane. It's like the best-selling wide-body passenger jet in the world. And Salahpour says that he...
watched firsthand sections of the Dreamliners fuselage being fastened together improperly, like basically just not like there were gaps in between panels and they weren't tightened down again, just like same seems like just basic level stuff that like, yeah, why would you ever not do that?
his takeaway from, from those observations is that he alleges that the body could fail prematurely. It could break apart in mid flight. That's insane. Just, I mean, me saying the most inane thing possible here, but like, I don't know when you stop and think about it, it's just so crazy that this is happening. It just, I don't know. It feels like some people at Boeing are just trying to recreate the plot of lost. Um,
by sabotaging planes. You know, I know there's been this big executive reshuffle. Are we seeing anything else? And that weird PR trip to South Carolina. But are we seeing anything else that the company is doing to sort of change its public perception or its trajectory in general? I mean, I have read things online
by people who know the inside of the industry and maybe even have talks with people internally at Boeing that are very quiet changes that they're implementing. But I don't really even think it's worth, like those things aren't even worth discussing for like the lay person if,
Boeing isn't pointing at those and saying, these are actual changes we're making to get to the root of this problem. We mentioned the drop in number of planes delivered this past quarter. Like I said, it's like half the number that they delivered in the fourth quarter of 2023. And Boeing addressed that directly and tried to spin it as the reason why there are fewer planes being delivered is because
We slowed down. We slowed way, way down on how fast we were putting these things together. And I'm sorry, but like if that's the solution to the problem, I don't really know. I don't know what to say about that. Yeah. Yeah. That's like a yeah, that doesn't make any sense. We're going to take a quick break, followed by my interview with Nowadays co-founder and CEO Justin Tidwell and Gia founder and CEO Melanie Mazarin about the growing non-alcoholic drink sector.
Have you had a drink this year? For a growing number of Americans, the answer to that question is no. Companies like Athletic Brewing and brands like the two we're about to talk to, Nowadays and Ghia, have seen enormous growth as consumers embrace sober October, dry January, and curb their drinking in general.
It's not all going well, though. After we recorded this interview on April 9th, Boisson, the largest non-alcoholic retailer in New York City, actually filed for Chapter 11 bankruptcy and closed all eight of its brick-and-mortar stores.
Still, the non-alcoholic market is forecasted to grow exponentially within the next decade, especially as major breweries, including Anheuser-Busch and Heineken, have expanded their alcohol-free offerings. So as I said, we spoke with Gia founder Melanie Massara and Justin Tidwell, who founded Cannabis Drink Brand Nowadays, to understand what's behind all the demand. Justin, I want to start with you. When you first launched, you thought it would take five years for Bay Alcohol to become interested in
in non-alcoholic beverages. It actually took about six months. So I'm curious, tell us how you started working with alcohol distributors and how that sort of changed your business. Yeah, absolutely. So we initially launched nowadays, truly about as bare bones as you can get. We had a very basic website, some product on the floor and Instagram and a TikTok. And we basically said, let's put this thing out there and let's see
if anybody's even interested in this product, because it's so new, will they understand what it is? And we posted our product on Instagram and TikTok. And I remember waking up in the middle of the night and seeing 10 orders, 50 orders, 200 orders, 500 orders, 1000 orders starting to fly in. And I was like, oh my gosh, we've really got something here. So we really started off with like, let's go to the people and see if consumers are directly interested. And what
What that showed us was that we were able to make enough noise direct to consumer and show enough consumer demand that it essentially forced alcohol distributors' hands to pay attention to what we were doing. Because at the end of the day, consumers buying a product was an indicator for them of, wow, this is something that we need to get into and look at. So it was really the success direct to consumer and then us being very noisy about that that
that drove alcohol distributors to look at us and say, you know what, is this something that we need to get on retail shelves? So that was kind of the route to market we went. And since then, we will be launching in about 30 states within the next 90 days throughout the United States. So it's moving relatively quickly.
Now, Melanie, I want to talk a little bit about selling online. I think Ghia has a really stunning bottle. I remember writing about its redesign a while ago, but I'm curious, how do you sell a product like a beverage to consumers who may not have the option to taste it before they buy?
Well, that was a huge issue for us and not our go-to-market strategy, but we initially wanted to introduce Ghia through the culinary world. So we had plans to launch in 50 restaurants as a beta launch on April 1st, 2020. And then we had to completely pivot to a strategy because two weeks before all the restaurants in the world shut down. So it was very unexpected and not what we wanted. And also even...
Beyond the fact that we launched online only, we also, during COVID, there was no tastings, there was no sampling in the markets. And so we really relied on a network of direct grocers or direct accounts, so vanity grocers, as we call them, like all of the super well-curated little shops that would order direct. Big Night and Pop-Up Grocer and all of those. But obviously it's very hard to scale. And it took a pretty long time.
for distributors to actually take notice of the category. I think that our growth was much lower than what it could have been in the first couple of years. And thankfully, we've opened a network of 24 distributors in the past year and a half. So now we're very much off to the races and able to do a ton more tastings and sample in restaurants and do all that. But
It was pretty challenging. So Melanie, every sort of non-alcoholic beverage company that I talked to has this pitch of like, now people want to live more clean and, you know, Cali Sober is a movement. And I understand all that, but I feel like
About five years ago, there was all of a sudden a ton of money and interest pouring into this sector. We wrote a piece on Athletic Brewing Company. Obviously, your company launched four years ago. Why do you think that is? Where did that come from? Well, I think five years ago, there was a lot of money pouring into a lot of different things that
Yeah, it's also true. And so VC money was flowing and the cost of capital was very low and consumer spending was at an all-time high. And obviously things have changed since then. There was a lot more enthusiasm from investors in funding new ideas. We're really seeing the growth in an alcoholic category happen now. It's happened even faster than I anticipated that it would happen. But
it's not just for people that don't drink. I really started this drink on the premise that
You know, at any given time, there's 30 to 40% of the adult population that doesn't drink. And then last year, we did a big survey with our consumers. And it turns out that 90% of GIA customers identify as alcohol drinkers and want to sometimes moderate and have a better option. So it's a bigger market than we even thought. Now, Justin, I'm curious about over at Nowadays, how you talk to your consumers. Are the majority of them totally non-drinkers at all? Or like, how do you position your product for them?
I think a lot of people in our space kind of started with the thought of people don't want to drink at all. And what we're really learning is that the best products in the space are great supplements. You go to athletic brewing, for example, a lot of those customers are having a regular beer and then they're mixing in an athletic brewing because maybe they want to keep the party going, but not too much. And that's what we're seeing on our end is our product really is kind of that middle ground between
zero alcohol and going out and having a cocktail, you're getting that benefit in the middle. And what we're seeing is people are using our product in the middle. So maybe it's Monday through Thursday. They've got to get up for work the next day, but they need something to wind down. I'm curious, actually, Melanie, I'll ask you this.
whether you're seeing any sort of newer trends or reasoning from younger consumers who seem to have a sort of very different attitude towards, I guess, like controlled substances, probably not the right way to put it. I think in general, they're not the core GIA customer. Yes, they're definitely...
They consume a lot more functional beverages, I would say, right now. I also think that while they're very interested in sobriety, maybe their purchasing power doesn't allow them to drink some alcohol alternatives quite yet. I really believe they're going to grow into it in the next couple of years. But in general, yes, I mean, we're seeing the kind of like Cali Sogo trend is very strong for them. They also drink a lot more ready-to-drink beverages. So they're not a core consumer of our bottle and definitely engage with the spritz a lot
more. Justin, you know, I'm someone who has honestly never had a drink. My family is Muslim. You know, drinking has never been a thing. It doesn't work with medication I take. But I've been so fascinated by this category of non-alcoholic beverages because to me, the alternative has always been like water, you know? I guess I'm curious, like, why you think there was this kind of consumer need or how you saw that need? Yeah. So I think for us, it's
It was really through our daily lives. And it wasn't us saying like, oh, younger people don't want to drink. It was us seeing our parents who aren't able to drink because of certain medical conditions or our friends not able to drink because they just had kids and they have to...
stay up all night with them. So it's really kind of the daily like, man, there's really like an issue here in our society where the only option we have, like you said, is water or drink alcohol. There's got to be some other better solution in the middle. So it's really kind of like number one, looking at our daily lives and what's out there and then backing it with the actual data of consumers moving in that direction. So it really kind of both came together.
Melanie, I want to talk a little bit about branding because I think that's something that Gia has done exceptionally well. How did you approach branding your product and sort of talking to consumers about non-alcoholic aperitifs? Like what was that messaging like?
For sure. I mean, I feel like we could have a whole separate podcast about this. I'll try to put it short. I really kind of knew what I wanted with Guillaume. You know, some of it was how do you make it not a version that is lesser than its, I'll
alcohol counterpart, basically. So not calling it anything that had like a negative word in it or anything that kind of almost referenced it being non-alcoholic. We really wanted it to stand on its own and be its own thing and take cues from the past. I think there's like a lot of inspiration from
old aperitif brands that we took because they're very celebratory brands. They're brands that are super joyful. And so we wanted to be all of those things. Like we never wanted to be just like a lesser version of something else. And so that's really led the direction for Gia. But we also realized that the consumer consumes differently today. And obviously I'm a modern consumer who maybe is like more inclined to choose something that is wellness related or up
in and out of drinking or feel like societal pressure to drink. And so we use kind of all of these different touch points to still make it fit into today's world. Where do you think, and I'll start with you, Melanie, but Justin, I want to ask you the same question. We've seen sort of alcoholic or just big beverage conglomerates invest a lot in the non-alcoholic space. I'm curious why you think that is, how these big conglomerates sort of see those offerings and
working in concert with their, you know, pre-existing ones? I'm going to be very direct in answering this question, but I believe that people are always trying to ask us like, who are your competitors in this space? And trying to put us against each other. And like, my answer is almost always our competitors in the space are the people we're taking market share away from. And we're definitely taking market share away from alcohol. And the reality is people
love to engage with craft spirits. And in the same way that they love to engage with craft spirits, they gravitate toward smaller brands that are more soulful and something that is very hard for these alcohol giants to recreate in-house. So it's a space that is very acquisitive. And, you know, these brands can very directly be started into an alcohol portfolio for them to kind of stay ahead because we are seeing, even if it's just like Monday to Thursday,
That's like four out of seven days of the week, right? That like people are drinking less. For them, it's much easier to purchase these brands than create this in-house. Yeah, I think she's spot on with that. And, you know, just to go a little further, these big alcohol companies have divisions to just watch the data and where consumers are purchasing.
And at the end of the day, like Melanie said, if people are changing what they're doing four days a week and they're consuming other products, then they need to have a close eye on where is that hole in our business and who are the people that are plugging it. And they're definitely very focused on this space and they want to continue to stay relevant. It's the rise of White Claw, for example, and now you see Corona Seltzer, Bud Light Seltzer all the way down the line. So they're definitely watching those trends and wanting to keep up with it. And I think it's
It's becoming harder for them to recreate these small, unique and genuine brands that are scaling versus just slapping a generic label on it. Right. It's hard for them to recreate what brands like Kia nowadays are doing out in the market versus trying to go out and acquire those brands. I want to talk a little bit about people's behaviors around non-alcoholic drinks. So for you all, Justin, I'll start with you.
St. Patrick's Day passed recently. I'm curious, do you see the same sort of uptick in drinking your products as a beer company might? Or do you see customer behavior being really different around occasions like that? Great question. So super interesting, actually, because this is our...
coming up here on our first full year selling our products. So kind of two interesting data points are number one, our revenue is up 15% month over month heading into St. Patrick's Day. And I think that's a good indicator that people are
gravitating toward a product like ours to go celebrate with on that holiday. And then number two, social media activities up close to 80%. And that really tells us that not only people actually buying the product to celebrate on St. Patrick's Day, but they're sharing it. And it's kind of becoming like a trending fun thing to do for people. So I thought those were two interesting data points. So definitely seeing an uptick around this holiday.
Melanie, what about you? And I'm also curious whether you see an uptick around New Year's resolutions when people might want to be sober for a month or something. Yeah, so now our business is not exclusively online anymore. At least half of it is offline. So we don't have super hard data on St. Patrick's Day. I would also think that...
Potentially, it's like a lesser, like important holiday for us. But in general, we see a spike whenever people celebrate, right? And so whether it's like November, December, always our biggest months, and then, you know, followed by January, this year, dry January was bigger than ever. So it was even bigger than December, which has never happened to date for us, which is really exciting. I think that, you know, a lot of it is because it's just proving how much the
like societal construct there is around drinking alcohol. And so dry January almost gives people a shield to kind of like safely explore and take a break without feeling pressured. So it's growing super steadily in the past three years, especially I think we've really, really seen people try a ton of new non-alcoholic beverages and like give sober curiosity a try. Easter is big for us throughout the spread season and the summer is big for us. November, December, really, really strong as well.
Yeah. I mean, I served Gia at my wedding, so I get it. I'm sure it's popular at other people's too.
Justin, you know, I live in New York and cannabis is basically legal. There's weed shops everywhere. And I'm curious whether you see any kind of, I don't know if correlation is the right word, but how that interplays with sort of non-alcoholic beverages. Do you see a lot of people being Cali sober? You know, how do you think about that? It's kind of a cool thing to see, like, number one, the rise of cannabis and like
how the alcohol sector is declining. And I don't think that that's a coincidence because I think there's a lot of similar kind of product attributes that it gives you. And
cannabis has a lot of the non-negatives that can be there as well too. So I do think that there's a correlation between the two. And what we see is that people that are willing to kind of try cannabis and give that product a try are usually more of like your pioneer, which is somebody that's willing to experiment and try something new. And then we see those people kind of bleed over to your standard consumers with word of mouth and say, hey, I tried this. It's good. It's safe. Like you should give it a try.
Melody, you live in L.A., which is sort of ground zero for, you know, Cali sober behavior, I suppose. How do you see sort of behavior around cannabis interacting with people's desire for non-alcoholic drinks? Definitely. I don't know if they're related, but they're both strong, at least independently, I would think. L.A. is like Stoneland, right? There's like a ton of weed. Yeah.
Kelly Sober referred to weed to begin with, but that can also encompass other things. You know, I think we're obviously seeing like a big rise in people consuming psychedelic mushrooms kind of more casually and socially. And so seeing some of that as well, I think that
non-alcohol in general was strong here even before then just because people drive a lot more and so it limits how much you can drink even if you're just kind of going to dinner on a weekday right it's definitely strong we don't have hard numbers of course it could be interesting to study it I've noticed
with a lot of food trends. This was actually in Beyond Meat's recent earnings that there's sort of a bump in sales because of the novelty factor and then things kind of die down. Have you seen that? Do you see people sort of like developing a lot of loyalty or do you see people trying a lot of different non-alcoholic options?
You know, I think like every nascent category, it's bound to become super competitive in the following few years after launching. So this is a very new category. And of course, I was speaking to someone from Boisson the other day and he said when we launched Boisson, they had 80 SKUs in the stores and now they have like almost 500 now.
right? But I think that obviously it's like very difficult to create a quality product and the top brands within the category are driving the lion's share of their revenue because they're the ones that consumers purchase again. For us, we're trying to really study the repeat rate of our customers, but of course, because we launched fully online and now we're launching in all these stores, there's some natural cannibalization, right? Like we hear from a lot of people like, oh, you're at my local bottle shop now, so I buy it there. In general, we have
seen, you know, one metric we can use is like year over year, same store sales. And we're starting to have enough data on those that we have full years of data. And I would say that we're still in the very much like hyper growth phase of the business. My last question for both of you and Justin, we'll start with you is
When you think about the future as a non-alcoholic beverage company, what do you think are the best sort of exit outcomes? We talked about seeing a lot of acquisitions in the space, but do you think there's room for sort of a huge non-alcoholic beverage new conglomerate? Do you think there's room for an IPO? How do you think about that?
Yeah, I think there's a number of successful outcomes. And I think for us as a business and me as an entrepreneur, I never start something and go, I want to sell this, right? I start this and go... Don't pretend you haven't thought of this. This is something that drives me nuts. Oh, of course. I'm getting there, don't you? I'm getting there, don't you worry. So I think there's a number of outcomes. I think number one, like if
If you look at, for us as a spirit company, there's a lot of large independent spirit companies from Tito's and the list goes on. So I think option A for us is that there's a really large scale for us and a lot of runway for us to really be, in our opinion, every single grocery store, restaurant, bar across this country. And that's really what our main focus is right now. But on the flip side...
I think what we're doing is extremely attractive to number one, big cannabis companies, because we are able to capture a lot of consumers that have never tried cannabis before. And that's really something that's interesting to them and I think could fit in their portfolio well. And then on the flip side,
At the end of the day, we're taking a lot of market share from people who are going to go grab that bottle of vodka or tequila, and they're now grabbing our product. And I think as a defense mechanism, there's a lot of opportunity for big alcohol companies to acquire us as well, too. So I think there's multiple routes, and it's something that we're always watching, but
My mindset is that it's inevitable that this category is going to be as big, if not bigger than the alcohol segment itself. So as that growth comes and the numbers show, I think those outcomes are definitely possible.
Melanie, what about you? What do you think about the sort of possible outcomes for your company? For us, we would be very proud if we were part of a big alcohol conglomerate, right? Like I believe our customer can enjoy, you know, a Campari or an Aperol Spritz on a Friday and a Ghia on a Thursday. And if they provide the same content,
ritual, the same moment of joy, the same moment of celebration, but they're aware of the health benefits of having a non-alcoholic drink, then we did something right. We obviously never preach for people not to be drinking. So I also don't think we're fully head to head with alcohol all the time. Now, there's a negative connotation to founders wanting to sell their business. But if I look at running Gia today, there's 98% of what I do is not building the brand and talking to customers. And
potentially could be done in such an easier way. You know, if a bigger group that had their own factories was handling my manufacturing and was helping me launch in places that don't have GIA like Asia, the Middle East or Europe, I think we could take it to so many more places and we could be on the bar at so many new places and celebrate with so many new customers. Like it could be pretty great, right? I think it's very possible, but I think it's more far-fetched than seeing
A ton of big acquisitions happen in this space in the next three to 10 years. Well, this was great. Thank you both so much for taking the time to chat with us. Great speaking with you as well. Thank you. Thank you for having us. Okay, we are back with Clint and it's time to wrap up the show with Keeping Tabs. This is where each one of us shares a story, trend, or piece of pop culture we're following right now. And Clint, since you're our guest, what are you Keeping Tabs on?
Okay, so have the two of you seen the nine-year-old on TikTok with the baby pet octopuses? No. What? I'm on TikTok so much. How have I missed this? You know what I said to Max yesterday? I said, let Josh send me one more TikTok in the middle of a workday because I keep dropping everything I'm working on to watch the TikToks at full volume. And then I forget what I was doing before I'll be in the middle of writing an email. Okay.
It's my fault. It's a me problem. I know. Yeah, what's this nine-year-old with the octopus? So the kid's name is Cal Clifford, and the octopus's name is Terrence. And the Cliffords live in Oklahoma. Cal's dad...
Convinced the local aquarium store to order Terrence for Cal because Cal loves octopuses. And then it turned out that Terrence was a female and that had arrived at the Clifford family home pregnant. Wait, I love this. So for weeks now, their home has just been in chaos from this army of octopuses. They've spent, they say, like $3,000 or $4,000 so far to handle all of this. The tank leaked at one point and they had to refloor the entire living room. Oh, no.
The number of babies that an octopus has, it's not like one or two or ten. Terrence had 50. Terrence had 50 babies. Sorry, I'm not sure of this story. I think I left out that key detail. Yeah, yeah, yeah. I was like, how could they have spent $3,000? Just like two more octopuses. And they can't be in the same space. They have to be separated. So they're all these little like petri dishes.
It's ridiculous. They've given them names like JC and Ciance and Swim Shady. Ha ha ha.
I like Terrence. Terrence being a woman is so funny. We love a non-binary octopus. The story's even crazier than that because they've been trying to rehome these babies, first of all. But it's not that easy just to, you know, like you have to buy like a bunch of stuff to take care of an octopus. It's like,
It's a complicated creature. And there's some other weird turns to this. Like apparently octopuses give birth in captivity to usually unfertilized eggs, but somehow Terrence's were fertilized. So like the odds of her even doing this were like near zero. And then usually the mother dies when, after she gives birth. But Terrence is very much still alive and kicking.
like getting the Clifford's millions of TikTok views. I love, I mean that TikTok money hopefully can save for, I mean, that's gotta be trying to rehome. Those octopuses has to be the weirdest Facebook marketplace post in Oklahoma. Yeah. I, well, you want a baby octopus might have to refloor your home. Clint. I think this is a best keeping taps we've had in a long time. Yeah. This, this might be a top of the list.
This is so good. We're going to have you back on to give us a Terrence update in a few weeks. Drop everything else you're doing. This is all you're focusing on. Yeah, exactly. 24-7 Terrence monitoring. Josh, what are you keeping tabs on? I don't think I can compete with that, but I'm going to try. It's tough.
I'm keeping tabs on Jojo Siwa's rebrand. Has anyone been watching? Absolutely not. I'm sorry. How this is happening. Okay, so to catch everyone up, Jojo Siwa, who one of her idols is Miley Cyrus, is trying to go from Disney Channel...
kid star, right? She was on Disney Channel. I'm almost certain that she was. I literally, I know, I have seen this person. I know exactly what she looks like. I know her name. I literally don't know why she's famous. Still, to this day, she's gay. We know that.
Yeah. That's about it. Oh my God. That's something that's a part of her life. Would she dress up as a minion at one point? Yeah, probably. That makes sense. But she's trying to basically like transition as many Disney stars do into like being a serious adult artist. And it could not be going worse for her.
She has a preview of a new song called Karma's a Bitch came out that JoJo Siwa had. And all I can describe her makeup and look in that as is like Gen Z kiss. I saw that picture, yeah. I saw that picture too. Yeah. It's not good.
so bizarre and then this is all wrapped around some truly like bizarre media appearances and also the other thing that's going around is this song karma's a bitch i believe allegedly jojo siwa has claimed to have written this song but then quickly a 2012 version of this exact song from an
an artist called Britt Smith started cycling that was like, no, you didn't write this song. This song existed back in 2012, which happens with songs. So that's happening. And then just like,
She also, like, in an interview claimed she didn't know who Gene Simmons was, who is the Kiss makeup that seems to be... She brings a level of preparation that I bring to some of these podcast records. It's terrific. But I will... Same thing as, like, on the... Clint's on the Terrence beat. I'm on the JoJo Siwa beat. So stay tuned to Most Innovative Companies for all your JoJo Siwa news. JoJo update. Bye.
Yeah, so what's your keeping tabs? So I actually can't believe this hasn't been in my keeping tabs before because it has long been one of my favorite YouTube channels and series that I wanted everybody to listen to. It's called Tribals, T-R-Y-B-A-L-S. And they basically get tribal people from Sindh, Pakistan, which is like the mountain ranges, to experience some stuff from Western culture for the first time.
And it's actually pretty wholesome. My favorite is this video where they ask tribal leaders to listen to Stairway to Heaven for the first time and they're all obsessed. And they keep talking about how Stairway to Heaven relates to the Quran because you have to be good to make it to heaven. That's so sweet. I know. No, it's really nice. They also had a bunch of tribal women reacting to Carl Sagan's Pale Blue Dot. Oh.
And they have one. They had a bunch of tribal people taste wasabi and they all described it as the most dangerous chutney. So it's just like, it's so good, honestly.
And that's it for Most Innovative Companies. Clint, thank you so much for joining us. Thanks for having me on. Our show is produced by Avery Miles and Blake Odom, mix and sound designed by Nicholas Torres, and our executive producer is Jojo Siwa-Stand, Josh Christensen. Remember again to subscribe, rate, and review, and we'll see you next week.