If you had asked Vitaminwater co-founder Mike Repole a few years ago if he’d ever return to the beverage industry, he would’ve responded with a vehement “no.”
Well, that clearly didn’t stick. Fast forward to 2015, and Repole’s latest venture, BodyArmor, a sports drink claiming it uses a healthier recipe than its competitors, is poised to earn $100 million in retail revenues for the year. It also has star athlete backers, including NBA stalwart Kobe Bryant as its No. 3 investor, and NFL quarterback Andrew Luck, who asked to get involved with the company because he liked the drink so much.
BodyArmor isn’t daunted by PepsiCo-owned Gatorade, which controls an overwhelming majority of the $8 billion sports drink market. “I think Gatorade is an iconic brand,” says Repole. At the same time, Repole suggests that the drink is past its prime. “To me, it sounds weird that a brand I grew up with 35 years ago is the same brand that my kids grow up with. It doesn’t make sense.”
That thinking partly inspired a video marketing campaign BodyArmor released on Tuesday. The gist: Gatorade and other sports drinks aren’t with the times, nutritionally speaking. But BodyArmor, naturally, is.
http://www.youtube.com/watch?v=BRKbcWGkw1I
BodyArmor, which Repole founded with Fuze Beverage creator Lance Collins, has notched a record of its own since its 2011 launch. Repole tells Fortune that it’s currently the only sports drink startup to still be kicking after four years since its founding, as Gatorade has historically crushed the competition within two. He estimates that his budding company, which is headquartered in Queens, New York and employs over 100 full-time workers, holds about 1% of the sports beverage market. Repole is confident that BodyArmor will gain more recognition among shoppers as soda sales continue to decline and healthier options gain ground.
“After 50 years, no one has been able to get to this stage,” says Repole. “Our best thing going for us is the brand and how it’s connecting with athletes and how it’s connecting with moms.”
BodyArmor is made of 10% coconut water and what it touts as all-natural ingredients, including 15mg of sodium, 300mp of potassium, and a slew of vitamins. Compare that to a standard serving of Gatorade, which contains 250mg of sodium, 65mg of potassium, and no “significant source” of vitamins, according to its nutrition label.
While BodyArmor claims that other sports drinks out there aren’t healthy, others beg to differ. A few years ago, Gatorade removed high fructose corn syrup from its recipe, substituting the sugar with a more natural variant, says John Sicher of Beverage Digest. Sicher also explains that there are also numerous varieties of Gatorade for different occasions.
Repole, 46, was born in Queens, New York and studied sports business in college. At 29 years old, he started a bottled water company with Darius Bikoff called Glacéau. That venture’s main product, Vitaminwater, took off and was eventually sold to Coca-Cola in 2007 for $4.1 billion.
Glacéau’s employees profited handsomely from the deal, as The New York Timesreported in 2011:
Repole, the coach, took care of his players. Glacéau’s 600 employees all had stock options: 50 of them cashed out with more than $1 million, another 150 with $500,000, and 200 with more than $100,000.
Repole is fond of speaking in sports metaphors. “I want to win at the highest level in business and surround myself with people who have the same passion, focus, and intensity as myself,” he says.
Part of Repole’s role as “chief coach” at BodyArmor, it seems, is recruiting an all-star cast of athletes who aren’t paid to endorse the product but are instead invited to take an equity stake in the company. Andrew Luck, quarterback of the Indianapolis Colts, needed no coaxing to get involved. In fact, he tells Fortune that during his stint on Stanford University’s football team, he would drink the product regularly since it was stocked in the fridge during his junior year. “It sounds a little to be good true,” Luck admits. He wanted to learn how he could sign on to the business. “It was one of those things when I turned professional, [I asked] how does it work when you’re a pro?” He reached out to his agent: “He made the calls,” says Luck.
Other BodyArmor investor athletes include Rob Gronkowski of the New England Patriots, Mike Trout of the L.A. Angels, Buster Posey of the San Francisco Giants, Richard Sherman of the Seattle Seahawks, and Skylar Diggins of the Tulsa Shock.
Luck says he appreciates that BodyArmor includes the athletes in their business decisions. “They’ve been very open about their strategic sales and marketing,” explains Luck. “They wanted a lot of input from us…. The folks at BodyArmor appreciate the opinions of the athletes, and I think it’s neat for us to be involved.”
Repole is unafraid to attack Gatorade for sticking with what he claims is the same recipe, although that isn’t the case. In addition to changing the sugar in its recipe, Gatorade also removed a controversial ingredient called brominated vegetable oil from its products in 2013, thanks to a petition launched by a teenager. At the time, Gatorade said that it was removing the vegetable oil due to consumer demand and not for health concerns. The company didn’t respond to a request for comment for this story.
But Repole does give Gatorade credit for sticking around for over five decades and counting. BodyArmor, he says, wants to “hydrate athletes for the next 50 years” so they’ll have covered athletes “for 100 years together,” he says, with humor.
Sicher of Beverage Digest says that BodyArmor has its work cut out for itself if it really plans to take on Gatorade. “Competing against Gatorade would require deep pockets, brilliant branding, and lots of patience, and the likelihood of success even then is questionable,” he says. “Gatorade is one of the most powerful brands in not just the beverage industry but in the U.S.” Sicher explained that while No. 2 sports drink Powerade “ramped up a few years ago,” it’s currently underperforming, giving Gatorade even more power.
Repole seems to understand that need for patience. While the company has enjoyed a 210% boost in sales so far in 2015 over last year, he says he is playing the long game. “I think we’re on to something big,” he says. “It’s a marathon not a sprint.”
