Seth Speaks

A few weeks ago I sat in on a conference call hosted by Beverage Spectrum, a trade magazine targeted to the beverage industry. The guest speaker was Seth Goldman, "TeaEO" (CEO) of the Bethesda, Maryland-based company Honest Tea, who make bottled tea, whole leaf tea bags and caffeine free bottled drinks. While the event was geared more toward industry insiders rather than consumers, I thought it would be interesting to pass on some of Goldman's remarks.

Honest Tea was founded by Goldman and Barry Nalebuff in 1998. Goldman said their reason for starting the company was "motivated by a desire to create a drink we thought was missing in the market," referring specifically to a flavorful bottled tea with no artificial ingredients.

The company made early inroads in 18 Whole Foods Markets in the Bethesda area and by the end of their first summer in business were one of the best selling beverages in those outlets. Growth was steady and over the last two years they have focused on expanding beyond the "health foods" niche and into the mainstream. Today the company employs 23 people but even though they saw a 65% increase in sales last year they are still a David in a world of beverage industry Goliaths.

One of the company's areas of focus thus far has been the Fair Trade movement since, as Goldman noted, tea is enjoyed by some of the world's wealthiest cultures and produced by some of the poorest. "We're selling a product that's authentic," Goldman said, "And we're trying to build relationships that are authentic."

Another area of focus for Honest Tea is organics, the increased interest in which, Goldman said, reflects an increasing consumer concern about health. Organics are especially important for a product like tea because the leaves are not rinsed during processing and thus any chemicals used during production are released when the tea is steeped.

Honest Tea came out with their first organic product in 1999 and went all organic in late 2002. "Organics, I think," Goldman concluded, "Is one that is here to stay."

A few of the new and upcoming products from Honest Tea include a line of unsweetened Fair Trade bottle tea - Just Green Tea and Just Black Tea. Also, pomegranate blueberry, part of their Honest Ade line, and Tangerine Green, which Goldman says will be the first organic diet drink.