Coca-Cola owned Honest Tea will relocate from Bethesda, Mary., to corporate headquarters in Atlanta following Seth Goldman’s recently announced resignation.
Coca-Cola said the move “allows us to fully integrate the Honest business into the company’s portfolio, as well as strengthen collaboration among the team and increase opportunities for career development for these associates.” Honest Tea will be relocated to new offices by the end of January 2020, according to a company press release. Honest Tea employs nine. The statement said “most roles” will move.
The announcements are related. The move did not trigger Goldman’s decision, he explained. Goldman founded the company in 1998 with his Yale business school professor and friend Barry Nalebuff. Instead, he told Washington Business Journal that his decision to move on “probably gave less of a reason to have the team based in Bethesda.”
“I’ve chaperoned Honest Tea, 21 ½ years after I launched the brand out of my home and 11 ½ years since Coca-Cola became an investor, and then owner of the brand,” wrote Goldman who was named TeaEO Emeritus in 2015. Coca-Cola invested $43 million for a 40% stake in the company and later purchased the firm in 2011. Goldman initially managed the company and continued to advise operations. He was a visible spokesman, TED speaker and author of Mission in a Bottle, a 2013 book describing the venture’s lofty “guide to doing business differently – and succeeding.”
“In 2015 I was fortunate to create an arrangement where I was able to spend half my time with Honest Tea and the other half of my time as executive chair of Beyond Meat,” Goldman explained. “At the end of 2019, I will step away entirely from my employment with The Coca-Cola Company and cheer on Honest Tea from the sidelines,” he said.
Goldman reminisced about the progress of the “freshly brewed and barely sweetened” bottled tea that he co-founded with Nalebuff who is the Milton Steinbach Professor Economics and Management at Yale School of Management. The firm was quickly accepted as alternate to heavily sweetened teas reconstituted from tea powder. The firm generated first year sales of $250,000 supplying 17 Whole Foods stores in 1998. Soon after, Whole Foods stocked the brand nationally. Today the brand is carried in more than 140,000 U.S. outlets, with thousands more in Europe and Asia, he said.
Honest Tea and its related lemonades, juices and kid’s drinks earned $600 million last year. In September the brand launched Honest Coffee, a cold brew.
“The inclusion of our 35 calorie juice drink on McDonald’s menus in place of the 80 calorie drink that was there before has resulted in the removal of more than a billion calories a year from the American diet,” wrote Goldman.
“Our organic purchases have grown from 800,000 pounds to more than 8 million pounds last year,” he wrote. Trade premium contributions to our supplier communities have exceeded more than $500,000 over the past few years, money that has been used to build schools, hospitals and clean water systems, according to Goldman.
Goldman plans to remain in Bethesda, overseeing Beyond Meat as executive chairman. On a recent earnings call Goldman said, “After 10 years of aggressively investing in our science and product innovation, this is the first quarter we have generated net income. It is a wonderful validation from consumers who support our business strategy of building meat directly from plants and choose Beyond Meat for its superior taste and texture while enjoying the nutritional and environmental benefits of eating our plant-based meat products. It also highlights our ability to generate strong expense leverage as we increasingly scale our operations, both in the U.S.”
A serial entrepreneur, Goldman joked in his farewell blog that his position as executive chair by design is not full time, “So that leaves another half of my workload to fill – or as my wife once put it, 75% of my time on Beyond Meat and 75% of my time on another enterprise. No announcements yet, but I am developing plans for the next phase of my journey. Stay tuned.”