Liquid Death: Mike Cessario

So you're talking about a quarter million dollars just to do the bare minimum run of a canned product. So I'm like, okay, I don't have anywhere near that kind of cash and there's nobody who's gonna write me a check. for the idea at that time. Well, I want to put water in a can and call it liquid death. They're like, that's the dumbest idea ever. No retailer will carry it. you know, h this might be a lot harder than I thought it was gonna be. Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements.

They built. I'm Guy Roz, and on the show today, how Mike Cesario turns store-bought water upside down by putting it in aluminum cans. Calling it. Liquid death. You've probably heard the adage

There's no such thing as a saturated market, which I don't know, is that really true? Have you visited the energy bar aisle at the supermarket lately? There must be hundreds of brands. But still. It is true that a smart approach can break through in even the most crowded aisle.

And if you don't believe me Well, Today's story is just for you because today's story Is about water. bottled water and that market is huge worth over three hundred billion dollars globally

І не юе шолон. There are more than eighty different brands. So many that It would seem almost foolish to try and break into that market. But a little over seven years ago, one foolish entrepreneur decided to do just that.

He had no experience in water, But what Mike Cesario did have was very good instincts and Almost two decades of experience in advertising. And Mike knew that if he tried something so utterly weird, so

totally outlandish. It might just work. Seven years on? The brand he built, Liquid Death? Sells more than a hundred milyen dollars of water a year.

And What is liquid death? Well It's just water. But what makes it so weird, so different. Is how it's packaged. First off, it's in a tall boy can that at first glance looks like malt liquor or an energy drink.

It's got a grisly looking skull on the front, with a gothic horror movie font that spells out Liquid death A name that You have to admit is kind of unforgettable.

Which is just what Mike Cesario intended. For years, Mike worked on creative ad campaigns for different clients. He loved putting edgy humor into his pitches, but He was often frustrated by clients who didn't get the joke, so he decided to make his own ad campaign. In fact.

Before liquid death was an actual product, It was just an ad, which Mike posted on Facebook as a test. A test to see if people would want to buy an aluminum can of water. Called liquid death. And as it turned out They did.

Mike grew up in the nineteen eighties and nineties in Delaware and Pennsylvania. His parents divorced when he was young, his dad worked for various companies, and his mom was a respiratory therapist. And from a pretty early age, Mike was into two things. Skateboarding. and punk music. Kinda went down the punk rabbit hole, got a guitar, started playing music, started playing

uh in a band with some of my friends that I skateboarded with. in like eighth grade. And then that kind of defined me as a teenager going through high school. Like I played in a band and I skateboarded and I and I was into always into creative, like I did art. uh drawing all of that since I was like really young as well. So Wh what were you drawing?

I drew a lot of cartoony stuff, like When I was Probably ten years old, my older cousin Eric. Like

collection of mad magazines. Like the all some as early as like late seventies mad magazines all the way up through the eighties. And I just thought that was the coolest thing I'd ever seen. Um So That kind of like

Comedy is what drove my creativity and how I drew stuff like funny cartoons, funny scenarios, little bite-sized things that felt like Mad Magazine. Yeah. Um, I guess after you you finish high school you you sort of bounce around for a couple of years and and and uh played in a couple of bands and F from what I understand, you were tr you were sort of trying to decide whether to to get into music full time or Or to go to college, but Uh but eventually I mean you did leave home. You left the east coast, um and decide to go

Study. Graphic design in California in in Pasadena, right? Yeah. And it was it was not because I didn't love music as much. It was more because I realized the reality of

A band is four or five people and you need everybody to be on the same page. Like I was all in, but I kinda knew I didn't feel confident that everybody else was. Yeah. And then Once I was in Art Center, that's when I all my first time probably in my life, I was fulfocused on one thing. I'm like Done with the music thing. I've been burned too many times that way.

I know that I can't just go get a job and design. I need I need to get great at this. This is where I really gotta get my life together. And I focused a hundred percent on design and advertising and you know, was getting straight A's and was at the top of my class and um Yeah, that's when I then went went into advertising.

And I guess y one of your or f maybe your first job out out of there was working for Uh a a a pretty sort of well known agency, Chris Finn Porter Buguski. Yep. Um Tell and and this is like tell me I mean I don't for people who don't know know advertising, they're like a a pretty

well known w was a sort of a particular creative agency, right? Yeah. They did a lot of funny Disruptive marketing. That resonated far more with me than like

The graphic design world it's like measuring pixels and designing to a grid and all this very meticulous stuff. You know, I was always into the more oh, let's make stuff that's funny and clever. But um You know, I think people will tell you like a year at Crispin at that period is like five years anywhere else because again it was like, you know, people called it a sweatshop, like

It really burned me out after a year, I mean. Doing that where I mean, I think there was a period for three months I didn't have a single day off. Um So it was After a year I kinda

was starting to look at some other spots and of course because I had a year of Crispin under my belt, there were some other agencies willing to pay me a lot more money than I was making as a junior. you know, creative. So you would a after that I think you went to another agency in Seattle after that, and you would spend the next sort of Seven years. at least eight years. Um

Kind of bouncing around. different agencies living. Um but I wanna I wanna kind of this time'cause around two thousand nine.

Yeah. What you got? invited to to see the van's warped tour. And and and I mean presumably you did like this is this is your jam. I mean these are like Punk bands, van Swarp Tour, Skater Culture. So um and and and I don't you know I don't know if it was

Apocryphal, but it it seems like That was a moment that would In some ways, It kind of. a l slightly foreshadow what what we're obviously gonna eventually talk about later on, but

Tell me about the van's warp tours. Lands in Denver. Denver, yep. And When they were coming through on the warp tour to Denver, like I

You know. They hit me up. Hey Mike, we're gonna be in uh Denver you should come out to the show. So I came out, they gave me, you know, wristband passes, like I was hanging out back on the On the on the their tour bus with with where they have like this kind of city of tour buses for the war tour where they all park and People are just sitting out in lawn chairs back there, bands like, you know, drinking, playing games, that kinda stuff. So just hanging out with them there.

And yeah, I saw they had these, you know. They were all drinking these cans of monster energy. But really small. On the bottom of the can it said. Tour water.

And They were like, Yeah, because I thought they were drinking energy drinks. They're like, No, no, no, like this is water, like the energy drink sponsor. you know, they don't want us drinking any other products besides Monster on stage and like Clearly people aren't gonna drink energy drinks. uh all day in the hot sun and

So they said so the the brand had to create water for the bands that look just like their product that they wanted to grow. So it wasn't like they were they were opening up Monster Energy, pouring it out and refilling it with water. It was literally water, but it just had monster energy on it. Yeah, they were never pouring it out. Like Monster had to create this for the bands. Um But but the p the point is, is that like the the image was of these like

Punk rockers. Who actually were probably healthy and like living a vegan lifestyle. on stage with monster energy, which is just Packed with the sugar and more sugar and that's not what they were drinking. They were actually drinking water out of those monster energy cans.

Exactly. And it's like oh that's kinda weird. Um But but this was not to be clear, this was not like an aha lipo moment. This was just an observation that you had Of these guys drinking water out of monster energy, and you just kinda filed it in the back of your head. It wasn't like I'm gonna change the world tomorrow. Exactly.

I mean, I was so into brand and marketing and I mean Deep, deep, deep in the weeds, especially like when you're working for such a top. agency like Crispin. It's like everybody eats, sleeps, and breathes like advertising and marketing and everyone knows what's the new campaign and what's been done before and what hasn't. Like

Yeah, I would that w that was my career. So I was hyper tuned into all the nuance of brand and marketing. Mike I I'm curious. Uh about the kinds of ad campaigns you you did during this period, like Like w what your personal style was. Yep. Because I at one point I know you were Living in San Francisco and and you're working for an ad company there.

And I guess your clients didn't always appreciate your sort of peculiar sense of humor. So what kinds of suggestions like do you remember making a suggestion that that didn't get made that you were like God, this is so good. Yeah, there was one. Um It was funny. W what's funny is uh

It didn't get made? And then Whatever it was, ten years later, I finally made the idea myself for Liquid Death, and it's one of our most successful things that we've done. Um There was uh A gough?

Club company, Callaway. And um They released this golf club called Diablo. literally had devil horns on it and flames. And we were trying to come up with um Yeah.

Yeah, a campaign or just like you know. Because Golf world, it's sort of like they would joke, like the marketing is so stale and unchanged.

Yeah, and literally did you just say four yards longer. Like that's the campaign. It's four yards longer. Show a pro, show the club. That's that's that's golf marketing. And one of the ideas I had, I'm like, okay, well It's this.

you know, whatever it is, four hundred dollar golf club with devil horns on it. It's called the Diablo. And I said, what if we ran a magazine ad? that was like a contract where If you Rip out this

Uh the this ad. and sold your soul to Callaway. You would get like the first whatever it was the first 20 people to do it would actually get a free Diablo club.

Yeah. And I'm like Think about it, like how much press attention will that get how many people will talk about that For free, that is not going to talk about

An ad with a golfer that says four yards longer on it. So it would be the ad in a magazine, like a golf magazine. Yeah, like a golf magazine. Exactly. Um And I thought that was I I just thought I'm like, man, this is How do you not do this? Like it's I mean

And uh My boss wouldn't even present it to the client. He's like, we're not even showing the client this mic. I'm like. Alright, fine. But yeah, it was those kinds of things and you know

We were also were working at that time, um on the airline Virgin America, when that was kind of a new hot airline and we were their agency and You know, I presented like all different kinds of um I think kinda cool ideas, but you know, again They just ended up only wanting to show the client just like very straightforward, like

Semi clever headline. Yeah. On a billboard and you know, not anything too disruptive. So yeah, it it it was very frustrating to to just really not be able to kind of I guess hone into what the you know.

what I felt like my creative potential was. Yeah. And then that's when I started thinking. I kinda was at this. crossroads of man, I'm I'm deep in it. Yeah. So I literally had the thought.

Okay. If I have to depend on clients. To buy. the ideas that I think are are are the smart things to do. Or I have to depend on my boss to be willing to passing us through.

Yeah. I'm like the only way, my only solution is I need to create my Own product. that I control what the marketing is for. That's the only way. Um, so then I really started thinking about

Okay. If I'm gonna create my own product, like what would it be? Yeah. It's almost like it's almost like you were saying to yourself, I don't really care what the brand is, I just want to do cool ads. And that's like and so the the product doesn't matter. It's just

I can't sell these ads to clients, so I gotta make something myself and just it'll it'll be like an outlet for me to make. Cool ad. So what were you thinking about? Like what kinds of Products could you sell around, you know, like yeah. So I was actually really inspired by this guy, um

He was a creative advertising agency owner in Philadelphia named Steve. Steve Grass. And uh he had this agency called qu uh Quaker City Mercantile. And they actually

helped create. And uh launch Two of the most successful Spirits brand launches of like At that time, like almost the last couple of decades, which was?

Hendrick's gin? Oh yeah, sure. And Sailor Jerry Rum. Rum, okay. Yep. So He was kinda like a punk sort of like a punk rock sort of guy that, you know, ran this agency in Philadelphia for years. They had partnered with this big liquor conglomerate called William Grant and Sons that was based in Scotland and um They asked them to help launch

a gin brand and they were like hey, as a Scot as a Scottish company it's really unique that we would ever launch a gin. You know, worse I wouldn't see this as Scotch. So They helped that they kind of helped them create the this entire Hendrix Gin brand. Which was Everybody was drinking Hendrick's gin and they were talking about botanicals and like all you know, right. I remember

And at the time. I was just very surrounded in the spirits industry. Like at the time I was Dating someone who was like a you know, mixologist, bartender. In San Francisco. In San Francisco, yeah. Like I was really into whiskey and bourbon and trying all these different unique things and

My brother was a bartender at the time. So I just felt like I'm more connected to this world and probably know more about it than the average person. I think that was my sort of um you know, litmus test for like what kind of product to make. You know. Yeah. Um

So yeah, when I thought, Okay, it's gonna be liquor and literally I just started looking and doing my homework. Um But yeah, the one kind of category that I thought I couldn't find one cool brand in really was Brandy. Yeah.

And I was like, we go to the liquor store and you look on the shelf at the brandy section. Th and there was literally dust on some of the bottles. Um And I started I was like so then I bought some brandy and was tasting it and I was like oh wow this actually tastes a lot like bourbon. Just a little bit sweeter.

Why? Is this such a dead category, yet a very similar tasting spirit is like the hottest thing there is right now. Clearly that is a brand and marketing problem that needs to be solved. So then I started kind of developing A brandy.

Brand. That's always the funniest thing to say. Um A brandy brand that felt more like a whiskey brand. You know,'cause I felt

people understand the like the the the design and branding aesthetic of whiskey and they associate it with a flavor profile. How do we bring more of that to brandy? Because it it is it it really is closer to that kind of profile. People thoughty was like ultra sweet liqueur, but it's not at all. Yeah. So when you say we, it was it was me, really. It was me.

I created this. Brand. that was packaged and marketed more like an Americana. Whiskey. Yeah. Western grace. Yeah. Um

So yeah, we kinda created this thing. It felt like a whiskey, but it was it was uh American brandy and I found a distiller in uh Ukaya, California. Sure. Yeah. And um Yeah, and these

Guys have been making some of the best brandy in the world. for like twenty years. They were making wine. No, they were making brandy. They were making brandy. Yeah, yeah. They had made like this craft brandy. You know, and I think when they saw this marketing young marketing guy who was passionate and excited about the category and had this cool idea.

Um on on how to market it and brand it, I think they got excited about it and they were like, Yeah, you know, we'll you know, we're down to kind of make it for you. Alright, so You find this distillery. uh uh north of San Francisco and

And then to get more help, um From what I from what I read, you did something really smart, which is you reached out to the folks from that that ad agency, Quaker City Mercantile, that you just talked about, that helped launch Hendricks Gin. Yep.

Um and and I guess you connect with the creative director who used to work there. and and some other people and and they actually agree to partner with you to to help you launch This brandy And And I guess you moved

back east to where they were based, which is Philadelphia, to kind of Is is that right? Yeah, so I moved back to Philly we we started figuring out the details of um you know, working with this distillery, how much they wanted to charge us, um, how much we were gonna create. And that was really like we were just gonna create a really small amount. Like I wanna say like the first batch of this stuff was maybe like fifteen grand or something like that. It was like not many cases. Like I don't know, sixty cases or something like that.

Um And then literally it was, you know, the these guys I mean they were creative directors and like VP level account people at agency. So they had probably pretty high paying jobs, like they were comb owners, like they kind of had their own independent money where I did not. Like I'm still paying student loans. I have like nothing in my bank account. So they were able to kind of

put up like a little bit to kinda help it going. Like I had um You know, I basically asked my dad like hey I got this thing like and I think they lent me like five grand like just so I could like put in a little bit also Um and we got like the first production going where we went through all the legal head you know, of like dealing like getting an actual you know through the red tape of having an alcohol brand and we got it into a warehouse in Philadelphia. Yeah. W what I realized then was

W with alcohol. So much of it isn't marketing, it's like this getting it into like the cool craft cocktail bars and getting bartenders on board and doing tastings. Like it wasn't really at that level about you didn't have the money for like brand marketing. It was just like, okay, you just gotta get this in the right people's hands. And They're basically like, Yeah, we're not gonna have any money to do real marketing for a while and it's social media and you you know, you can't

Market alcohol to anyone under twenty one. So you have to be careful about what you can put on social and Um And then um After two years. I just butt heads with the the two folks that I had started it with.

Um, you know, we just weren't on the same page about so many different things. Different but totally different vision. And then um They kept the brand going for a while and it wasn't until um I think it was Two summers ago during uh Covid.

That they officially sort of shut. the the company down. Right. And so you never made any money off that? No, no, didn't make any off that. I I mean you probably were spending a lot of your time just on like The mundane

you know, logistics of just getting it distributed even. Oh yeah, it was such a headache. I mean the legal paperwork, background checks, like it it really was such a a a nightmare. Um and that was part of the reason where when I was thinking of my next thing, I'm like Okay, whatever it's gonna be is g there's gonna be almost no regulations, like

No complicated ingredients or manufacturing processes. Like it needs to be very simple because that stuff just It it's yeah, it w it was really difficult. Mm. What do you did you feel? Like

I don't know, like you failed. I mean, did you feel bad? Did you feel like God I pour all m the last two years into this thing that I really thought was gonna be the thing and now I'm like back to square one working looking for agency work again. I mean it was yeah, I mean it w really was a tough time for me. It's like you know, I worked at one agency that wasn't great and then I got fired from that agency. because they kinda I think they realized my head just wasn't in it and I was literally just like phoning it in. So it's like I'm fired from a really crappy agency. or what I thought was a crappy agency at the time. And I just had this whole like w what does it all mean, like Where you know, where um What am I gonna do with my life? I have no interesting work in my portfolio. There is no cool agency that's gonna really hire me.

But eventually you do get hired. uh by an agency I uh that was I guess based in in Chattanooga. In Tennessee is called human human aught, like astronaut human aught. Um And y and you wind up doing an ad there, which kind of turns your career around.

Um which I've seen, you can still see it. On YouTube. Um The client was of the dairy company organic valley. Um and you m you make this video for them. It's actually so funny. It's so good. Um

Uh. didn't know about it until I d I did research on this for this interview. Um, was like a parody of of protein drinks and they were trying to market a protein drink. Can you can you tell me the story uh about that or like the idea that you came up with? Yeah, so Protein shakes.

In culture. were so associated with like muscle bound growth, right? Guys who are jacked. Yeah, yeah. You tell anyone you know and and uh That's the whole culture that they were going to be launching into. Uh-huh.

So yeah, we had this idea. Oh. You know. if all these bros keep drinking all these chemical laden protein shakes, like how long are they gonna be around? And they might become extinct and then like you might miss bros if that happens. So that was kind of the seed of the idea. that we then turned into this like

Yeah. It's it's sort of a format that's been done a million times, like the parody PSA. And it's a it's just a video of a bunch of guys like You know, pumping iron at the gym, no body fat, just, you know, muscles. And then drinking these really sugary

Yeah, or whatever chemically. protein shakes. You know, g the the premise is that they were gonna die. Drink these drinks. But our bros are in serious danger. Every day. Millions of bros drink protein shakes in order to get jacked.

Yoked. Totally swole. But most bros are unaware of the scary chemicals and artificial ingredients inside these shakes. If pros keep pounding this stuff at this rate We could face a total bro colony collapse. And and what it

What did they think? At all reluctant? About this idea. So I think they they liked it at first. Um

And then once we had the final cut of the video. And then uh they started, you know. sharing the video with some of their um you know, family farmers because it was like uh Uh you know, it's a company as a co-op, so it's like you know, partially owned by the farmers. So they run the stuff by the farmers.

And of course that was the wrong thing to do because these guys just totally didn't get it. Um They literally almost didn't run it. But they were nervous. They were nervous, yeah. So then we launched it. It goes totally viral.

Everyone loves it. And then, you know, organic valley's calling us. Guys, we need bros at trade shows. We need bros everywhere. We need more bros. What's the second bro video we're gonna do? Uh Mm. Yeah, I mean it's e it I mean you look at it and you think this is a no brainer, it's gonna go viral, but uh obviously it's it's impossible to know, but it it looks like an S and L skit. It's just so funny. Yes.

Yeah, it was I mean I'm for For Not much. They got millions and millions of dollars worth of, you know, eyeballs out of it. Yeah. So that was I mean, it sounds like you know that was a uh a a sort of an important turning point. I wonder whether when you when you went to this agency Humanaut, right? This is around twenty fourteen.

Um You know, did you think that your time as an entrepreneur was over? That you had tried this brandy brand and it didn't work out and Maybe you should just keep You know, and and now you're getting some momentum in this agency and Did you think okay, this this this this is this is good. I'm good. This is gonna work.

Yeah, I I I felt Like I had found my lane again, you know, like I was making stuff that I was actually proud of. Then that started bringing in more people, you know, more companies coming to us for that like viral YouTube video, you know, especially from the health food space. So that kind of became like our specialty. We started doing it for

Um You know, other brands. Meantime, this is now like a Yeah, six, seven years. After that.

Van's Warp Tour show where you saw m people like these rockers. pounding water out of monster energy cans. That idea was kind of in the back of your mind, but you weren't Admittedly, thinking of this as a brand But I guess what around this time, around twenty fifteen This idea comes back to you not I think not initially as something you wanted to make, but like

as part of an ad campaign for For a client, right? Yeah, so at Human Art, um We had the opportunity to pitch ideas to this company um called I think they're called the center.

for science and public health. Yeah. And they wanted to do a commercial that really like brought to attention like the Dangers or unhealthy.

Elements of soda. And I think it was called the real bears. And you know how Coca Cola, like they're Icon.

Yeah. So you couldn't say Coca Cola, you couldn't disparage a brand, but they just had this little Um cute cartoon where they had polar bears that were drinking Soda. And it was like kind of real happy, like, you know.

Go lucky. But then it's like They start getting diabetes and then they get their arms amputated. Um Then they they said, Hey guys, we want to do something like this, but now we want to call out the dangers of energy drinks. Because that was such a big thing. The danger is because they're just packed with sugar. And caffeine.

And caffeine, yeah. Yeah. And um The thing that we landed on was that And that kind of came from, you know, some of my experience, you know, from the warp tour, which was The reality is

You know, these guys are Use all these a you know extr you know action sports athletes to market this stuff. It seems like they're drinking this stuff, but the reality was it was all bullshit. Like these guys are actual athletes. Like they have trainers. They will they will not be drinking. This much caffeine and sugar. Like they take their stuff very seriously.

So you know, we um You know, we we came up with like a couple of different ideas and like the you know, the idea that I had and I think partially because I had just come off of like an entrepreneurial thing of creating a product. So my brain first goes to Oh, what if we created A water brand that looked like an energy drink.

And it was all about making fun of uh the fact that this is what these guys actually drink. Mm. So maybe we do like a funny video. that almost feels like it's like I don't know, like a commercial or something for this ridiculous product where I think you know, we were saying something like

Hundred percent water, zero percent bullshit. Like that was like the line. Yeah. Yeah. And and what did they say? W what do they think about the idea of of doing a uh you know, a spoof. So I like that. Yeah, so I wasn't there to actually present the idea. It was like our boss who presented the idea and you know, they just They had zero interest in creating a real product. They're like, No, guys, like we don't want to create anything like that. Like we literally just want

a funny video like the real bears thing, but for energy drinks. Yeah. But I just knew there was something there. I'm like Regardless if these guys were gonna do this, like I think I stumbled onto something really interesting here. And I kind of just kept it. in the back of my head and like I started just

flipping that entrepreneurial switch again because I finally found something that got me excited that I thought I saw white space there again. How how do you how do you remember that happening? I mean, it was an idea. You'd first encounter this kind of weirdly In two thousand nine. Then you pitch it as a spoof product, but then how do you make the leap

in your mind to be like, Wait a minute. No, maybe this this is a real product. Like maybe there is something I can do here. Well I think I was already in uh What's my next entrepreneurial mindset? Constantly.

doing you know my When I kind of focus on something, I just go into this like deep dive of homework, like where I just become obsessed, where I'm like Okay, let me research the you know, the bottled water market. What would you find out? I mean I mean this is like two thousand fifteen.

What I mean, there's a lot of water brands on the market, a ton. I mean, you go to the aisles of of Safeway at that point. Yeah now. I mean still. There's everything. I mean from Voss to Fiji to Mountain Spring to Avian and Perrier and Poland Spring and you know there's a lot of brands. Yeah, and and I think

a lot of brands that are all very much the same and not fun or interesting, you know, when you compare it to something like Monster or Red Bull. Or you know, Bud Light or like these, you know, brands that are associated with hilarious commercials. exciting packaging, you know. youth culture, like all of that kind of stuff.

Um There was nothing like that in water. When we come back in just a moment, how Mike comes up with the brand name and the logo that do not evoke spring water. In fact

Think Poison. Stay with us. I'm Guy Raz and you're listening to how I built this. Hi guy, this is Stephen Council. I'm in a small workshop in Queenstown, New Zealand, where I listen to how I built this.

Perhaps that's why I relate so well to my favourite episode, Burt and Snowboards with Jake Carpenter. Because he was in a small workshop by himself as well. I admired how he was open about his loneliness. He showed his emotional vulnerability. And he was so modest, having created an Olympic sport and a whole new industry.

That reached so far it impacts the town I live in here in New Zealand. We're a ski and snowboard destination in winter. It's a beautiful episode. Thanks for such a great show. If you want to share your favorite episode of how I built this, Record a short voice memo on your phone telling us your name, where you're from, what your favorite episode is, and why. A lot like the voice memo you just heard. and email it to us at hid at id.wondery.com, and we'll share your favorites right here in the ad breaks in future episodes.

And thanks so much. We love you guys. You're the best. And now Back to the show. Hey, welcome back to How I Built This. I'm Guy Raz. So it's around 2015, and Mike is thinking of launching a bottled water brand that's unlike anything that anyone's ever seen before.

Starting with the idea that it won't even be bottled. The original idea for a can, or a tall boy can, was like, Hey, this Looks like something like a beer or energy drink that feels fun, but what's inside is actually really good for you, which is rare. There's rarely anything inside of a can that's really good for you. The c the concept from the beginning was canned water, not bottled water, not plastic glass. Be an aluminum can it would be a tall boy, so it could look like a you know, like malt liquor or an energy drink. Yeah.

Exactly, yeah. And then So I'm trying to find like okay, where's there a water source? Like who can actually can water? So I'm like Googling. you know, water sources in Kentucky or Tennessee or places like hey, who can maybe actually produce this stuff? Um

Then I also started seeing that you know the more news articles about how bad plastic is. Like that was like those were starting to pop up in a big way then where Hey.

you know, how much plastic ends up in the ocean and companies were starting to say, Hey, we're s gonna stop using Uh you know. Plastic, uh you know, bottles in our companies and It was it was uh

It was kind of a hot button topic that was starting to kind of you know, sizzle up at that time as well. So it's like, oh great. Not only is the can Really cool. Now there's actually Th there's like a a deeper reason why, you know, aluminum's infinitely recyclable.

It's way you know, it's a way better alternative to plastic. Like it all all these moons just started aligning that this was the right Okay, so while you're researching this, right? Um, first of all, imagine There's lots of places that bottle water in the United States in North America, so

Um I imagine it's not that it's sort of like cosmetics, right? You go there's tons of white label manufacturers and you stamp your brand on it. So was it w was it pr relatively easy to identify You know, of a bottler that could Take water and then just put it put in a can. In the US.

I I had the same exact thought as you had and it was the opposite of that. It was impossible. Didn't exist. And that's kinda. They were only using plastic? So when you Create a bottled water. Or a canned water. The only way it makes economic sense.

is you have to basically bottle it at the source. And you did not want to use city water. You want to use Spring water. Right, right. And even if I wanted even if I wanted to use city water, there's a whole other thing that you'd have to do there. But no, I I wanted this to be like a premium spring source because you knew that based on the cost of aluminum, You're not gonna be able to sell this for the same price as a

piece of trash plastic bottle, right? It's like this is gonna have to have a premium price point. So you're gonna have to justify it with at least the product inside feels like there's a premium story. Oh it's From a mountain, it's from a natural source. This isn't, yeah, city water. And most spring water is bottled at the source because presumably it's very expensive to t to truck it down somewhere. Yeah, yeah. It's like you have to find a source. Yeah, you'd have to tanker truck it, you know, spend money on fuel. So nobody does that. And so presumably There are places that are bottling water at the source and cans, right? Presumably, but no, because it was not a category that existed. So every single

You know. water source that had bottling capabilities, they only had plastic capabilities. Maybe a couple of them had glass. But even that was rare. So it was all plastic, like the whole industry. You could not find you could not find a spring. In North America that had a

Had a had the ability to to So That's probably uh discouraging, right? Here there goes your idea. Yeah, that kinda slowed.

some of the momentum of my idea down when I realize how hard it was gonna be to produce, like What uh started is this like fervorous, Oh my God, I found something, I found something, I'm researching. Yes, all this stuff makes sense. And then yeah, it's kind of this big roadblock of Well w literally there's no one that can make it, so this you know, this might be a lot harder than I thought it was gonna be. And meanwhile, I guess around this time

Um you decide to move Back to California. um this time to to LA. And I guess you get a job as a creative director at a skateboarding company. um down there. But um

But But this idea, this canned water idea, is obviously it's in your head. This is like gnawing at you. Um I mean you think that there's something there, of course, obviously, and and at a certain point you Uh you come up with the

and a concept for how you want it to look. Yeah, so I think once You know, once we're in like I think it's like two thousand you know Seventeen.

early. I I finally have kinda landed on, you know what the general concept for Liquid Death was gonna be. Cause it wasn't always gonna be look like a beer. It was kinda like, you know, does it look like an energy drink? Like so then when I finally decided, hey I want this thing to look like a beer. Like that was kind of the concept. I remember calling one of my best friends and telling him, I'm like, hey.

I think I have the new business ideas, like what is it? I'm like I wanna put water. in cans that look like cheap beer. And that felt right to me'cause I'm like, you know Everybody wants stuff they're not supposed to have. Yeah. It's like they say, hey, if you want teens that think something's cool, you actually market it to people in their twenties.

You know, it's like energy drinks. they kinda mark it to teens, but 17 year olds don't think monster is the coolest thing, but 12 year olds do. You know. Yes. Oh yeah.

Yeah. Um So it was like hey If we actually want You know.

teens or even people in their twenties th want something. Like let's not make it look like a kitty energy drink that twelve year olds think is cool. Let's make it look like a beer that like Everyone between you know, fifteen and fifty think is cool. So then I just really started pulling all these beer references for like, hey.

What does classic beer design look like? What kind of fonts did it be? Mood board, exactly. Like pulling all these references of like I used a lot of craft beer. um inspiration Not so much in the design, because craft beer design Part of what makes it great is it doesn't look anything like typical big beer.

But it also just it almost is like craft beer is cool because it kinda looks like a soda or energy drink most times and not a beer. That's what makes it interesting. Yeah. So then but from like a naming perspective, I thought some of the craft beers had some of the most interesting like brand names. um compared to regular beer where it was like There was like a skull crusher IPA. There's like arrogant bastard ale. Yeah. Yeah. They had all these really interesting Fat tire. Fat tire. Yeah. Like I think like one of the early like really bad names that I had was like Southern Thunder.

Terrible man. Terrible name. Um But I think when I really started thinking about like again, it's like okay, let's take a step back. Like If I launch this. Thing.

For real. What I learned from Western Grace. There's going to be no dollars for marketing. Um And the only chance this has at survival

Is it has to be something that people naturally want to share on social. So then I started thinking like, okay, what are some of the names where if someone saw this, they have to share it. And that's where it's like you literally start trying to think of what's the dumbest craziest thing you could think of. Like start there. Yeah. Like liquid death, like

Liquid death was one of these names. It was just like what sounds like something that like You would never want to drink. And it's like, you know, liquid death. Do the opposite of what you think you should do. But I remember thinking like yeah, liquid like A beverage called liquid death, like There is no chance someone's not sharing that if they see that in a store. Yeah.

And so Once you I had the name Liquid Death, kinda had like rough Sort of. Package design came up with it.

Design. Well no, I worked with um A buddy the the buddy of mine I mentioned a while ago who was like the intern Crispin years ago who's a designer. Um he kinda helped me out uh'cause he's way more of a designer I think that than I was. So he kinda helped

throw together some can designs. Um based on like some kinda clear direction I had. Like, hey, kinda want this colors, this thing. I actually kinda made the type like I found the typeface for Liquid Death and kinda did. You want an old English type face. Yeah. Because it looks almost like a m liquor. Well what they call that, it's called German black letter font. Yeah, and that's why so much beer, because beer came from Germany really to the US. That all these old brands that they use like that very German inspired look and feel.

So then I started thinking of okay. We don't have any money. This is gonna cost a lot of money to produce. Like you can't make I mean because I knew I knew a little bit about what it cost to make aluminum cans, because I think I got a quote from one of the like ball or one of these aluminum can manufacturers like, Hey, what does it cost to produce Yeah. Uh. Sixteen ounce cans or twenty four ounce cans.

And it's like, oh wow, the minimum, minimum you can produce is like 200,000. And So you're talking about a quarter million dollars or 150 grand, something like that, just to do the bare minimum run of a canned product. Mm. Um So I'm like, Okay, I don't have anywhere near that kind of cash and there's nobody who's gonna write me a check.

for the idea at that time of Oh, I want to put water in a can and call it liquid death. They're like, that's the dumbest idea ever. No retailer will carry it. Um So I'm like, okay, I'm gonna make A funny kind of commercial for this that feels like it could be viral, like the stuff we had done at Human Odd and

And and things like that. And then the original idea was but I'm gonna use this video to be like a Kickstarter or Indiegogo thing. Right. Oh, you would you'd build build an indie gogo page with a video on it. Yeah, exactly. Okay. And I think yeah, we set out to raise like it was like a you know, like On Indiegogo. On Indiegogo. So we made this video that you probably saw where it's the

The woman who's pouring out a can of liquid death the entire time, she's kinda giving this monologue about water has been like misbranded and people think that You know. Water some, you know. yoga thing when really water is deadly. Like it you know, it kills

Surf surfers and you know, whatever. And then there was a avalanches. Avalanches, yeah. And then there was this funny idea of like trying to position water comically as extreme. And the closing shot, which is quite shocking and very risky is of a guy duct taped to a table. Like she now you th it pans out. This woman pouring the water is actually pouring it onto uh a guy who's being tortured wearing a um Like being waterboarded, basically.

Yeah, yeah, it's yeah, it's just it's a guy in a bus in a business suit. A business suit basically being waterboarded by liquid death. Um So this and you you basically hired some actors and just made this. It's it wasn't expensive to make. Uh my wife Carly edited the whole thing. Um she actually edited almost all of the early liquid death video stuff.

uh whatever software you use on your Mac. Yeah, yeah. And then that was actually me being waterboarded. Okay. So look I wanna just break down the two things'cause the video. And would be very successful. But the Indiegogo campaign did not actually was not successful. No, it was like we set out to raise a hundred and fifty K and I think we raised like fifteen hundred dollars. So Now I'm like okay. Now I'm just gonna put it on social media. Like I'm gonna make a Facebook page.

For liquid death, make it seem like it's a real company. I'm gonna put this video on there. I'm gonna make a couple funny social posts about it. So I put maybe a couple thousand dollars in paid media. behind the video and behind some of these little social posts.

Over the course of like four months or so. Yeah. So then like After four months the video had a Like almost three million views. It was like

Two and a half million views. Um the the page had like, you know, fifty, sixty thousand followers. I have hundreds and hundreds of comments from people that range anywhere from like this is the greatest thing ever how do I buy this to This is just a real Yeah, is this a real thing? Yeah, is this a real thing. This is the dumbest thing I've ever seen.'Cause there was no link at the end saying order liquid death. It w you did not have a product to sell, right?

No, didn't have a product to sell. And then eventually I made like a pre order page where it's like, Oh, you could still Pre quote unquote. Give your email and pre-order this. Yeah. I I'm wondering, Mike, how did you so

The idea was Like'cause there's different ways of doing things, right? Mm usually people will make like a trial run They'll try to maybe sell it at a farmers market or like at one whole foods. You started with the ad campaign. You didn't even have a product ready to go. But when you made this video.

Did you have the infrastructure in place? Like did you identify a Men a potential Copacker, a place that could Yeah, no, I had none of that. Um

And and I knew that uh the one thing I did know, if I did want that or If there was gonna be a way to produce it. It was going to be probably at least$150,000. Yeah. So I knew that the only way to get the capital was to really kind of prove out and de-risk the concept. So when I had all of a sudden early 2018 I had

a Facebook page with a lot of followers. I had a video with millions of views. I had tons of comments of people seeming genuinely interested. I literally had a seven eleven franchisee from Michigan who said, Hey, I own three seven eleven's how do I get this in my stores? I had the biggest non alk Distributor.

in uh New York called Big Geyser. One of their people reached out saying, Hey, can I talk to a sales rep about carrying your product? So I use all of that to then say, Okay, maybe I can actually now go raise you know, a friends and family kind of round. You know, my family was not wealthy, so it's not like I could just go get

Money for my family. So it but it was like hey, former bosses that were big marketing executives that I had good relationships with who maybe like, you know, them writing a five thousand dollar check for something wasn't a big deal. Um So I basically cobbled together all these like

You know, two thousand to I think the the biggest two checks I got were each like twenty grand. But everything else was small and I've kinda put together this round of like a hundred and fifty K. So you want to prove that you could gain virality. And then you could raise the money that you would need.

to actually produce the product, but where were you gonna do that? You you you you you said that nobody was doing this. Nobody was canning water. It was all plastic bottles. Yeah so I bef you know, before we actually started raising the round, I did have um A couple different leads on who could produce it. And roughly what it would cost. So

There was you know, there was one place that was I think like outside of Las Vegas that said, Hey, we can do it, but it wouldn't be springwater. It would be kinda like more of the city water. Yeah. Which I wasn't that excited about. And the guy was basically like, Oh yeah, did you know that like you're not gonna be allowed to call it liquid death. Like the FDA won't let you do that. And I'm like, What do you mean? He's like, No, yeah, it's death. Like you're saying, you know, it's false advertising and you you know

I'm like, really? And I and again I trust some of these people, but thank God I didn't. But um So I still kinda knew. Okay, I've talked to the experts now and literally now they're telling me There's no really no way they can do this. So then I'm like, okay. I'm gonna start Google searching outside of the US. I'm gonna start Googling Europe.

canning water co-packing in Europe and sure enough I found this place in Austria That said they own four of their own Spring water springs, they had canning capabilities. email them, they're like, oh yeah, we can definitely make this for you. I'm like, really? Um

So just to interrupt, I mean. Everyone told you this is impossible. But essentially what they were saying was it is impossible in the United States. So My like if I was you, I would be thinking, Okay, even if I was looking at Europe, I would be thinking, that's just gonna make the cost so much higher to get this done in Europe, like I don't really wanna do that, but that was your only option. That was the only option available. Only option available.

But you still needed the capital to make it. Yeah. So I at that time, like I was already raising the capital because I had the one source ready to go in pricing. So I knew what it would cost. But then when I started, you know, the money started coming in. And at that time, once I was raising money, I am not a finance guy at all. So A good buddy of mine, um uh JR, who I went to high school with, he was kind of like a serial entrepreneur. Ever since he graduated high school, you know, he w he went to college for finance.

So then he came on board with me as like a co founder. But again, at that point, so much of it was already like the the brand was already figured out, the Facebook page was already going. I already ra raised most of the money. It was just like okay, now I have all the pieces. Now I need you to kinda help me you know, execute all this stuff and do the stuff that I'm not good at. And he was very cool with that arrangement. And that was that that's what I think works so well with us in the beginning was we never stepped on each other's toes. And and so

When you I mean and even when you were raising money, right, from friends and then eventually you g you you were able to raise a little bit from a uh a V C firm that had I think it invested in Dollar Shave Club. Did any of them ever ask you, Well, what's the

qualitative difference? Like what what makes your water taste better? Or were they all kind of convinced by your argument that that doesn't matter? It's Water, you know, spring water is spring water generally. It's all about the branding side. Yeah, I mean that was always part of my pitch. Like as a marketing guy who really understands the nuance of brand, that's what I could make clear for people the reality is that In most things.

It is brand why things win, not functional differences. Like Nike doesn't market because They say hey Our commercials, our shoes use this type of material that lasts

Thirty seven days longer than Adidas. Like no no no. It's all brand or why someone's buying a seven hundred dollar Gucci T shirt. It has the same functionality and thread or whatever it is as like a twenty dollar target T shirt. Might be the same factory. Might be the same factory. Um

But that you can more easily understand why brand matters and why that is still successful when because I think For me, that's the definition of brand. So so there's no point in sort of leaning into this Our water, you know, mountain spring water tastes so pure and bl like that Y you you couldn't really carve out a space in the water.

um category by doing that alone. I mean it needed to be what people perceived as at least a premium product. Which what what we found is like source did matter to people. So that's why it was like hey, as long as we have a good source story like hey this is you know mountain water like this is from a mountain that's enough to make people feel like okay this is a premium product. I don't need to get into the weeds beyond that. How did you know that? Did you have access to market research? No, I think it was just you could kinda just

You could look at the brands out there and You know, it's pretty easy I think like you could talk to average person. Uh hey What do you think is more premium? Water from a city or water from a mountain? Uh mountain. Yeah, okay, got it. It's not rocket math. So you all right, so you find this place in Austria to

m package and you've got now some money that you've raised. And the idea was to just what I mean, now that you have eighty thousand followers on Facebook, that was gonna be your presumably you these were gonna be your first customers. So so you were gonna sell them direct to to consumer from like you were gonna, I don't know, have like a a logistics or drop shipping or some kind of third party, you know. Logistics team that would s sell them directly or you would do it through Amazon or what? What was the plan? Yeah, so it was through Amazon and um

You have your product as a page on Amazon. Um People can buy it. Amazon ships and fulfill the product for you and then Amazon charges you a fee. for every case that they ship and fulfill.

And it was very expensive. That's why you know, we had to charge twenty dollars a twelve pack in the beginning to even get Anywhere n you know, into the black in terms of like making money on a case, which was so expensive. Um because it was so expensive to ship a heavy case of water that weighed pounds. Like that's not cheap to ship. Like if you try to go to FedEx right now and ship a twelve pound case of liquid death, they're gonna probably charge you twenty dollars just to ship it.

So you had to sell this at a premium. I mean you had to basically in order to Make some profit, which I guess you could because you already had these eighty thousand Facebook followers, many of whom were waiting to order this. Exactly. Yeah. We had a little bit of a built in audience. And again. So many of those people didn't even believe it was real.

Like they still just thought this was a funny Page to follow. And then once we were like Hey, look, guys, it's real. You can buy it.

generated a different level of buzz, I think, you know. And you I I from so you launched this, it's amazing because it's w we're talking here at the end of twenty twenty three. You launched this in twenty nineteen. Um It at the beginning of that year. And in the first month

You sell out all your inventory. Do about a hundred thousand dollars in sales. So that's That's a very good sign. Was it all through that Facebook page that you were able to sell them? Was it or did you did you like pay for some PR at that point or did you'cause you had some money, did you did you start to do some of that? No, so you know

just before we launched, it was, you know, we had real product. Uh that was getting ready to be shipped to the US from Austria in like October of twenty nine of twenty eighteen. At that same time, that's when I met our first kind of venture capital investor uh science who like he said was behind dollar shave club

Um You know, you know they put in significantly more Capital. Which

actually enabled me to quit my freelance job I was doing full time to pay the bills to actually go full time to Liquid Death at a huge, huge salary cut. So then I was able to just kind of quit my job and spend for the first time ever like full time, full time focus on liquid death in like late 2018. And I worked with science to kind of help me figure out the tech and digital. Um aspect of making this like a true D to C brand to start. Wow. And you know we had a strategy for, you know, paid social promotion. But again, I think the first month we only spent maybe$2,500 in paid media to generate$100,000 in sales.

Why don't we come back in just a moment? while logistical log jams Force Mike to find a copacker. That's closer to home. Stay with us, I'm Guy Raz, and you're listening to How I Built This.

Hey, welcome back to how I built this. I'm Guy Raz. So it's early 2020, a few years after launch, and Liquideath is starting to grow. and starting to get orders from some big retailers. First, whole foods, and then kind of on the opposite end of the spectrum. Seven eleven.

I was always targeting Who are the people That don't care about healthy brands that are drinking. soda and energy drinks and beer most of the time. How do you get them to actually

resonate with a healthy brand and actually want to make more healthier decisions. Based on You know. it's more fun to have this brand walking around than it is. You know.

A PG or or something else. So it's like you get a lot of overlap in terms of like Yes, we bring new people into the category where it's like, hey, these construction workers who shop at seven eleven who are buying Two energy drinks for the first time ever are coming over and buying a premium bottled water just because of the brand. They were never buying Fiji or Voss before. But then you're also getting the people who did buy Fiji and Voss were like, oh, I I like premium water and this is just a more interesting brand. Like, yeah, I'll try that. And yeah, it's good.

Yeah, I mean it it's Whole Foods is interested'cause they like I mean This brand was a purple cow. It was like People were going you knew

That you People were gonna stop and pick it up, especially Whole Food shoppers, because Whole Food shoppers are not used to seeing something called liquid death. Like you wouldn't go to Whole Foods and think like, Wow, they're selling a sugary energy drink or they're selling malt liquor at Whole Foods. Like You're like Right. I mean so in some ways it was like the perfect You know.

to launch this brand. Yeah, and and in a way. It was The only retailer

Who would even give us a chance. I mean, we had talked to I don't know, like a broker for Target. And they were like, uh yeah, guys, we don't think this is the right fit for mom. Yeah. Um like and any of these other big retailers like wouldn't really give us the time of day because it says death on it. But at least Whole Foods, what they really identified with was our whole death to plastic messaging. Right, that was part of the campaign because when you launched

I mean not only did you when you launched, you also then started making more of these videos. Right. And Videos is an animated video. That is also just insane. I mean it's basically an animated video of like a can

A can like axe murderer, just like killing people and just sl slaughtering them. He's murdering thirst and it's just like gory and bloody And um I mean It's basically like a Yeah, I mean it's like a

Video. But again designed to get people talking, presumably. It's I think it's an interesting topic and I talk about it so much. Like everyone uses the word edgy. Like oh you guys do edgy marketing. So All we are doing

is we just want to make legitimate entertainment. Not marketing. And it's a tried and true. Approach that Red Bull was very successful with, Monster was very successful with, where they blur the lines between

an entertainment company and a beverage company. Now their specific type of entertainment is action sports. But that is a very I think limited genre of entertainment. Like, yeah, it's really cool to watch skateboarders and snowboarders and skydivers like do crazy stunt like stuff, but there's a lot more entertainment in the world that people consume.

So for us, we're like, hey, our entertainment is comedy. Like that's what we're really good at. We're really good at making people laugh. and making funny videos and not a lot of p companies are. Like a lot of companies struggle to deliver humor, but that's our unique strength that we have. And if your tagline is murder your thirst and your video is of a cartoon Giant can on a you know, mus muscle bound beast.

Just ax killing um then you're gonna get attention. One of the things that I'm I was curious about is you launched in Whole Foods. Like the week the pandemic starts and A big part, I have to imagine, a big part of your whole

like strategy is that it's so such a weird product, liquid death It. that people were gonna pick it up and that's half the battle. Like once somebody picks up a product. there's a good chance that they might actually take it to the register and buy it. But now whole foods are

Are You know, mostly I don't know, mostly, but a lot of the shoppers in there are like uh you know professional shoppers are for delivery services, right? Right. I mean, were you worried that your sales were actually gonna be

badly affected because people wouldn't be able to physically like See it and And pick it up. Well luckily um By the time we had launched in Whole Foods in you know the late

Spring of twenty Twenty. We had already built a pretty Large. Amazon and direct to consumer.

Business. What in your first year t three million. Yep. Dollars already. Yeah, yeah, yeah. Just under three million. In revenue. Yeah. Um

And again, remember We were selling those cases for like twenty bucks on Amazon. So now twelve twelve cans for twenty bucks. Yeah, and then because of all the how expensive it was to ship a heavy case of water. Now when it was in Whole Foods,

they could actually sell it for$14.99. So now we can tell everyone, hey You can go get it at Whole Foods now for a lot less money. So we were able to kind of drive a lot of existing customers. that we had from Amazon into Whole Foods so that definitely helped. And you didn't have any issues getting it to the US given that there you know shipping and all that all those disruptions? No, there was I mean there was some issue. Yeah, we definitely dealt with some issues where things were held up at the ports. I mean we had things where some of the first shipment of liquid death were held up by customs because they see something called liquid death and they want to make sure it's not like a terrorist thing.

Yeah, right. But uh liquid methamphetamine or something. So we definitely had, you know, issues where you know our containers were held up for like a month at a port and we had to like wait on product. Like there was Yeah, a ton of stuff to kinda A battle and then

The real you know pain point was in spring of twenty twenty one If People remember There was that

Container ship. That ended up blocking the Panama Canal. Oh yeah. Was it the Panama Canal or Sue? The Suez Canal. Yeah, you're right, you're right. Yeah. Yeah. And um It just completely halted so much. It was such a Like it it kind of started this chain reaction of

Got. Ocean freight. Costs. Literally over the course of two months, ocean freight costs went up like five X or something insane.

Yeah. And All of a sudden we started getting killed on ocean freight costs in the back half of twenty twenty one where We might have been spending

You know. thirty five hundred dollars to ship a container from Austria to to the US. And now all of a sudden it was twelve thousand. And then 2022, everyone's saying, oh, it's gonna come down, it's gonna come down.

Never went down. And then like midway through twenty twenty two, it went up again. Hm. So We kinda knew eventually we would move to Copacking in the US once there was, you know, a good partner for us that could

do all the things we needed them to do. So You know, we got connected with a great source in uh the mountains of uh Western uh Virginia. Not West Virginia, but like Western Virginia. And then we also at that time You know, we had launched Flavored Sparkling.

Which again is more like a healthy soda. They're low in sugar, right? Yeah. Two, three grams. Yeah, like four grams. Yeah, it was like three or four grams of sugar, twenty calories. So That opened up some of our co-packing abilities once, you know, we started having a ton of success in our flavored. Yeah.

Flavored sparkling. Mike, by twenty twenty one You I mean you just now you're starting to really attract investors and I'm sure they're banging on your door. By twenty twenty one you raise a series C already.

And uh uh Over half a billion dollar valuation, which is By all accounts just crazy. I mean you s you launch this brand with no valuation.

And and you're at half a billion in a year and a half. And Yeah. Uh and you're You know, as I say, you you're you're

Attracting all these people who wanna wanna work with you. And and I wonder whether Um A a part of you start to get nervous about how quickly I mean, or maybe I don't know, I mean I've talked to founders who are like, We're growing too fast, you know, this is too fast or there's too much pressure. But

I don't know, was it but was a part of you worried at all? Or are you just like yes, amazing, let's bring more of this money in. No, I think I was um I was excited at at how fast it was growing because I think

We built the team. the right way to be able to sustain the growth. I think You know, even as an organization.

We've taken a very almost top heavy approach where it's like We want Seasoned. gangsters in every position, you know, where

They've done things at a much higher level so that right now they can do this level of stuff in their sleep. Versus like You start with I don't know, a lot cheaper labor to kinda try to save money, but it's less experience and less you know, talent.

And then there's more risk that if you're growing that fast that they don't even know how to deal with that kind of growth and it breaks. So I think we we built the team the right way to be able to sustain that level of growth we were at because yes, it was fast growth for us as a company, but you know, even in twenty twenty, um twenty twenty one

I think we you know we did uh I think it was like 45 million in like gross top line revenue. Um That is tiny for a beverage company. Like you're not even a blip on anybody's radar.

at that level. I mean and and I think, you know, people had reactions to you know, uh whatever it is, over a half a billion valuation for for water, like what's what's wrong with with the world? It's like Did you know that smart water

plastic bottles of municipal tap water sells a billion dollars a year of it. Same thing with the Aquafina, same thing with Poland Springs, like Th these are massive categories. This isn't I'm not surprised. No, I'm not surprised at all. I I wonder I mean, the the thing is, and we've done on the show, you know, we've talked to founders who started a brand or product and really try to build a moat around it, right? Because that's what you're taught. It's like the Microsoft famous Microsoft documents where you build a moat and then

You know, nobody can compete with you. Your product is is protected. It's so hard to replicate. Um water is not hard to replicate. You're obviously anybody, you know, with the with some capital can bottle water. Um, but your whole play was about brand, right? Now you're in a space with a lot of big players, the Poland Springs and the Aquafinas and the Desanis and they go on and off Fiji. Um Mm.

Did you start to see any of them? Even attempt Two Try and Eat into your

Your audience, your market share. No, and I think that, you know, brand is the moat. And I think it's hard for people to wrap their head around what that means. But there's a lot of

sort of historical precedents to show that that's the case. I mean you've seen There was a great example. Coca-Cola, the biggest company in the world with all the resources and shelf space in the world. Try to take share in the energy category by creating Coke energy.

Yeah. And it was a two year experiment that was a massive failure and, you know, hundreds of millions of wasted dollars. And you would think. Hey. How could Coca-Cola fail at creating an energy drink brand?

And it's just like it it It shows that giant companies are really bad at creating brands. Like they there's just too much bureaucracy, there's too many focus groups. And I'm sure Coke Energy, it probably passed the focus groups, it probably passed all the layers of test and everything. And then in market, it just totally fails. Think about the other things p people in beverage try to use as a moat. Like what is your functional ingredient? You can't own that ingredient. Coke can buy that ingredient for way less than you can. Like there's real much like you can't own cans. Coke gets cans for a fraction of the cost that you're gonna get cans for. So if you're a canned water brand, marketing it as Canned water, aluminum, infinitely recyclable, that's your whole brand?

You're just yeah, you're just educating people on why cans are great, so then now Coke can just put it in a can and you've just helped them you know, break in. So That's why we always led with brand and what we could own first, which is funny irreverent brand, making people laugh, murder your thirst, death to plastic was always the second thing because at the end of the day we knew we can't own aluminum cans as a brand.

Yeah. Okay, now here here's I think a fair question to ask and probably b been asked a version of this, but um You know. Uh

U you have this amazing brand that uh is obviously hit. It's really hit. And I can see it with my kids, right? And I can and can see it with with with your sales. I mean I think You're on target to do track to do.

at least what a hundred million dollars in revenue this year, maybe more? Oh yeah, significantly more. Significant more, okay. So What

is what makes this brand sustainable in the long run. You know, I mean There are So many examples in history, starting you know go back to the Pet Rock. that that were phenomenon дево фор фю єр And then they just kind of went away. I mean

What makes liquid death have staying power like you know Perrier's been around forever, Avion's been around forever. So What makes this brand? Or does it matter whether it's around in twenty or forty years.

Yeah, I mean I do think that The era of brands lasting fifty years. Or or no more. Because of the because of the internet and technology. Like look at Coca Cola, like of their whatever it was.

Hundred and twenty year stint. A hundred of those years did not have the internet. Um.

And I think because of the internet and the hyper speed digital culture. The other difference is You can make As a brand now.

with digital and virality and and the democratization of of media and attention In five years. You could be a brand that's literally doing billions of dollars in sales. Well that used to take fifty years to get there. Yeah.

Yeah. Like look at White Claw. I mean that was a brand that didn't exist. And then all of a sudden in five years they were doing, you know, whatever it was like Over a billion in sales. But that's a good example'cause they're they've also declined significantly since then. But it was

That was an interesting scenario because they had Hard seltzer was a new category. that had this massive spike during COVID. That was kind of unprecedented and now it has just kind of settled down to what is still a huge category. It's just not that like

in the outer space level than it was during a very particular cultural period. I mean part of you and maybe maybe not, I mean given that you know this as I say, this is like a It's like a a an overnight success story that took twenty five years, right? Because you were in this space of advertising, branding for so long. You were observing, you were watching, you were like trying to push your ideas and and you couldn't quite convince people to to do the things you want to do. And so essentially you started a brand so you could can make funny advertisements. I mean, that's basically the story of liquid death. You you wanted to have fun making ads. And this was the vehicle to do that.

Exactly. Yeah. It was yeah, it was y you have a product. That generates. Money to help fund You know. cool things that people wanna see in the world that

Is not more crappy marketing that people are willing to literally spend ten dollars a month and not have to watch or that they can skip. Um You know what we're tr we're in the attention. game. Like we need to generate outsized attention for our budgets that allows us to swing

way above our you know, our weight class really, where we can generate similar amounts of attention as let's say Coke or Pepsi type brands can, but we can do it with like one fiftieth of the budget. You know, like that's the game we're playing. Like if we start trying to play the same game as the big guys where it's like, oh, let's go. Sign a two million dollar athlete.

endorsement deal. or let's go wrap a NASCAR for a million dollars. Like that stuff is not gonna move the needle for you, and you're just gonna burn through your money before you ever get to the finish line because now you're trying to play the same game as the big guys with without anywhere near the resources and you'll lose. I mean you in a very short period of time. 'Cause you've your whole career you were paycheck to paycheck. You know, you're making a decent living, but you were not a rich guy, but in a very short period of time you made a lot of money, probably much more than you could have imagined.

Um, I mean it must be kind of amazing to to be in that situation, but Uh unanticipated or or or what? Like in twenty nineteen if I would tell you, hey, you're gonna be multi millionaire and like A year and a half. Would you have been like yep?

I know it. No, I wouldn't have. Uh With all the things that I gone through.

And so long. It's like You know, I I think I had a cynical view of like man like every good thing I try, something fucking happened. Yeah. So I think I you know, I it it was I try not to let myself get too excited about things.

too early. So I kinda just want it to like play out. So I take everything with a grain of salt and I've I've I've sort of always have that approach. And I still have that approach now. It's like I don't wanna ever like get too carried away or too comfortable. I think it's so important that you're always hungry and feeling This could end at any moment. And how does that change the way you think if you if you know it could end at any moment? Like how do you approach things differently? How do you take more precaution? How do you not take too big of risk?

Um a fatal flaw is like the bigger companies get. You start trying to act more and more like a big company. Yeah.

It it can go south pretty quick. When you think about the the journey you took, right? And I I I use that word journey. hesitatingly'cause it's so overused, but um I don't know, d do you do ever do you ever think about

why it happened, like do you think it was because you worked really hard and you're really smart and you thought things through or do you think A a significant amount of this has to do with Just getting lucky. Yeah, I mean there's always luck involved. I mean I think back on so many moments where it's like man so

Good thing we did this and not that, or This might not even be around right now. But I think To your point, a twenty five year o i in the making overnight success. I think all of my

Previous experiences all kind of helped ladder up. to help me make the right decisions. Um And then again, just the hunger of All this failure.

I think it's just all laddered up and and then the fact that it could be a brand that was truly a reflection of myself. in the brand. It's not like some. MBA business guy who's like, what are the kids into? Here's what they're into.

When it all starts with me as the CEO. it just kinda trickles through the rest of the company and decisions get to be a lot easier. It's a lot simpler to have a unified voice and know what to say yes to and what to say no to. I think it it it's all sort of, I think, come together to to make it this successful. Oh

That's Mike Cesario, founder and CEO of Liquid Death. By the way, remember back when he was working in advertising how they mixed his idea about Selling your soul to the devil to get a Diablo golf club? Well Mike sort of brought that idea back. But to liquid debt this time.

You can now go onto the company's website and sign away your soul for exclusive access to merch and other deals. And on the sign up sheet it says By selecting Sell My Soul I agree to receive important info and offers from Liquid Death since they will own my soul. For eternity. Hey, thanks so much for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show. If you want to contact us, our email address is hibt at id.wondere.com.

This episode was produced by Carrie Thompson with music composed by Ramteen Arablui. It was edited by Neva Grant with research help from Casey Herman. Our audio engineers were Robert Rodriguez and Josh Newell. Our production staff also includes Alex Chung, Chris Massini, Carla Esteves, JC Howard. Sam Paulson, John Isabella, Catherine Cypher, and Malia Agadello. I'm Guy Roz, and you've been listening to how I built this.

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