July 2011   |   Volume 2, Issue #9

Zeroing in on Zevia

No doubt about it: there is some sweet irony in the fact that Paddy Spence is the Chairman and CEO of Zevia, the all-natural, zero-calorie, stevia-sweetened soda.

It has nothing to do with his long history of building natural foods brands like Kashi and Nature's Gate, nor his considerable achievements as the founder of SPINS, the Nielsen-like company whose data services have helped the entire industry grow up. It's unrelated to his impressive academic record at Harvard (College and Business School), and is only indirectly connected to his passion for participating in active sports like triathlon, martial arts and wrestling.

Paddy Spence, CEO of Zevia

Rather, the beautiful irony in the trim, auburn-haired Spence being selected to head up this fast-growing brand is that he had long ago given up on soda, and on sugar itself.

"I had been a soda fan as a kid, and like lots of other people had grown up drinking colas and lemon-limes and root beers," said Spence from his hip new headquarters in Culver City, CA (so hip that it doesn't even have the company's name outside the office).

"But I had gotten away from soda because it didn't appeal to my lifestyle. Then, about 11 years ago, I completely quit sugar cold turkey. I had always considered myself a health-conscious person. I exercised regularly, I ate what I thought was a very clean diet. And yet when I stepped back and looked at it, I was consuming almost 250 grams of sugar a day from protein smoothies, energy bars, sparkling juice drinks, etc. So I had about 1,000 calories a day just from sugar."

Spence and his wife decided to completely eliminate sugar from their diet. No white sugar, no brown sugar, no agave, no honey. No sucrose at all. The only sweetener they would use was stevia, a natural product made from a plant related to the sunflower.

At first, the experiment in sugar deprivation did not go well. Spence broke out in hives, and was laid out in bed for a couple of days, exhausted. But it didn't take long for that to change.

"I have to say, it changed my life. And to this day our household is sugar-free." Including his 18-month-old daughter.

Mind you, this was all long before anyone ever came up with the idea for Zevia. Because although stevia had been grown in Latin America and used as a natural sweetener for centuries, and although it had been used in food and beverages in Japan since 1970, in the U.S. it was still regarded as a dietary supplement. Not until 2008 did the Food & Drug Administration approve it for use as a sweetener in food.

Zevia was born shortly thereafter, and before long it had a certain stevia-loving, triathlon-running, data-crunching new CEO.

A Hard Look at Soft Drinks

Carbonated sodas date back to at least the 18th Century. With the invention of "phosphate soda" in the 1870s, the dime store soda fountain had its heyday. But once brands like Dr. Pepper® (1885), Coca-Cola® (1886) and Pepsi-Cola® (1898) were created, and with them a bottling process that "kept the fizz in" (there were more than 1,500 patents for various corks, caps and lids), soda production and consumption really took off.

For nearly 100 years, these products were made using simple ingredients: carbonated water, flavors, and a sweetener. More often than not, the sweetener of choice was cane sugar. In the latter part of the 20th Century, as sugar prices began to skyrocket, cane sugar was often replaced by the cheaper high fructose corn syrup. But it still had plenty of calories, among other issues.

Stevia growing in California.

"We've all heard about the evils of high fructose corn syrup," says Spence, "but interestingly, at the end of the day your body doesn't know the difference. Sugar is sugar. Whether it's high fructose corn syrup, cane sugar, or alternative sweeteners like agave, honey or fruit juice. They all spike your glucose levels, they all have calories, they all contribute to diabetes and obesity."

Those are major problems, indeed. According to statistics provided by Zevia, 27% of adults and 17% of kids aged 2 to 19 in the U.S. are deemed "obese". These numbers have been on a dramatic long-term rise. Moreover, 25 million Americans have been diagnosed with diabetes, and as many as another 79 million may be "pre-diabetic."

"Simply put," says Paddy Spence, "sugar is killing us."

Lately, there have been some laboratory-made alternatives. As fitness and specialty diets came into vogue, the soft drink manufacturers turned to low- and no-calorie artificial sweeteners like Aspartame® and Splenda®. Unfortunately, these may have their own issues, and at the very least, they are a cause for concern among many Americans.

Enter, Stevia

Stevia, on the other hand, is an all-natural botanical sweetener that has no calories. It is safe, and does not spike glucose levels in the bloodstream. Molecularly, the sweetening agent in stevia, known as "Reb-A," is about 300 times sweeter than regular sugar, so it can be used in very small proportions to obtain a very big taste.

The stevia plant is a member of the sunflower family, traditionally grown in Latin America and China, but now making great gains in North America. In fact, all of Zevia's stevia comes exclusively from the U.S.

Zevia uses stevia along with another natural botanical sweetener called erythritol to obtain the perfect balance of sweetness and after-taste. (Erythritol is derived from corn.) They also source fresh fruits like oranges and cherries, and spices like vanilla and nutmeg, to perfect the flavor of their sodas. They currently have 12 flavors on the market (seven of which are available right now at Sprouts — Cola, Orange, Ginger Root Beer, Black Cherry, Ginger Ale, Lemon-Lime Twist, Dr. Zevia — and the remainder of which, including Cream and Grape, will be arriving any day).

Although the zero-calorie nature of Zevia is perhaps its biggest selling point, that doesn't necessarily mean it is a "diet soda."

"'Diet' is an interesting term, because diet implies it's a temporary state," notes Spence. "You know, a diet is something that you are going on to lose weight and then you are returning to your so called normal lifestyle. Honestly, we don't think that Zevia soda is a diet soda. This is something you consume forever, whether or not you're on a diet."

Regardless of the nomenclature, sales have gone through the roof, at Sprouts and elsewhere. Paddy Spence and Zevia seem to have hit on the right formula at the right time.

Still, despite his heritage as a data junkie, Spence is not solely focused on the sales curve. He remains circumspect and somewhat philosophical about what he and his colleagues are doing.

"One of the neat things about my job is that I have the opportunity to share Zevia with folks from a whole bunch of different walks of life. And one of the most gratifying things is seeing kids, particularly at events, who have never even tried soda in their entire lives. These are kids whose families banned soda. When they drink their first Zevia they literally can't get enough of it, and the look on their faces is just priceless."

"Zevia is a product that really does have the ability to change lives," he continues, with a hint of a smile in his Irish eyes. "People who drink soda like to drink a lot of soda. And as we know, a lot of soda with sugar, or a lot of soda with artificial sweeteners, is not a good thing. So I think we've made a demonstrable benefit to the lives of a lot of folks, and I am certainly one of them."