This interview refers to episode 12 of The Art of Manufacturing podcast. Listen to the full interview with Greg Steltenpohl here:
Greg Steltenpohl (PICTURE) realized that playing saxophone in an avante garde punk jazz band wasn’t going to pay the bills, so in 1980 he and his buddies decided to start a business. Hand-squeezing oranges out of the back of his VW van and delivering the juice to nearby restaurants in Half Moon Bay, they had no idea that more than two decades later their company called Odwalla would pioneer a fresh juice craze and be acquired by Coca-Cola for $181 million.
Today, Greg’s second beverage empire, Califia Farms—best known for its citrus juices and almond milk—continues its advancement of sustainable, plant-based foods and beverages with the launch of a new line of coffee beverages. He was kind enough to give me a taste test.
I was curious what it was like to launch and scale not one, but two beverage empires, and so we sat down over samples of cold brew to have a discussion about sustainability, leadership, and innovation in beverage manufacturing for The Art of Manufacturing podcast.
Greg is driven by sustainability. Although almonds have gotten a bad rep for being water-intensive ever since the latest drought, he argues that cow milk requires many more times the water to create as the same amount of almond milk. It takes 600 gallons of water to make a single hamburger.
And most of the agricultural water in California is used for cattle feed, much of it going to China, not food for our consumption. The way we’ve turned cattle into part of the industrial food machine has become a disaster for the environment, he argues, not to mention inhumane.
“The elephant in the room is the cow,“ he quips. And he is driven to change our love affair with cattle through innovative food and beverage products.
Ironically, his drive isn’t always healthy for himself. He shares a very personal story about how he needed a liver transplant a few years ago while he was starting Califia. He was so single-minded that he ignored the very real threat to his life and kept going with the business. If it weren’t for his wife stepping in, he probably wouldn’t be alive today.
That wasn’t his first obstacle as an entrepreneur. Greg recounts many of the challenges he faced over the years building his businesses. He was met with droughts in back-to-back years. In 1996 e. coli in their apple juice sickened dozens of customers. One customer even died from complications.
They could have waited until more evidence came out, or pointed fingers to their vendors and suppliers, but they took responsibility immediately, recalled the products, and averted a complete disaster.
Their sales plummeted 90% the following year. But they had built up so much customer loyalty that they rebounded within two years.
Despite the rebound, the e. coli situation shook their company values to the core. It forced them to rethink their whole premise of unprocessed and un-pasteurized juices. It also required them to take on extra capital, which reshaped the face of their board. Where once they had founders, women, and a psychologist steering the company, they now had “six investment banking dudes” in the boardroom.
After he became a minority shareholder, he could do little to stop the investors’ desires to flip the company. Greg doesn’t generally disclose his feelings about the Coca-Cola acquisition, but he wasn’t completely pleased by the outcome.
The founders had held out hope that there would be a silver lining—that Coca-Cola’s distribution could be the ticket to achieving global impact. But as Greg explains it, “Coke didn’t really know what to do with it. It wasn’t through malevolence…it’s not in their DNA.”
So now, at the helm of Califia Farms, he’s making another go. He is applying what he learned from decades as a beverage entrepreneur (see “3 Tips For Being A Successful Beverage Entrepreneur”) and he makes it look somewhat easy. But maybe it’s just his laid-back style.
Because the biggest unknown in his current venture that keeps him up at night is whether he can stay independent long enough to see his vision through. He admits his biggest mistake in the past was to not trust his gut early on, and to be tempted to bring in people who didn’t have the company’s same ethos—even in the earliest years.
“It’s one thing to say we want to go to the moon or mars. It’s another to share the passion.”
He is a minority shareholder this time around as well, but he is more deliberate. He trusts his instinct. And he believes that building a rock-star team with the right culture makes it less likely that a partner can come along and steer the company away from his values.
This approach permeates the operations of the company. He explains how his entire team, from line level to the head of manufacturing, are connected with iPads and Apple Watches, enabling everyone to contribute improvements along the way.
We often think about product design as the focus for innovation, but Califia is constantly rethinking everything from process on the factory floor to distribution and marketing. He embraces technology and innovation across the value chain.
The idealistic 25 year old environmental studies major would scratch his head if he saw himself today, he chuckles. He never imagined himself a businessman, let alone someone capable of running a $100M company. But he notes the irony that in his current role, he is much more closely aligned with his original ideals than his old self.
“When concepts, ideals and visions move together with practice, implementation and sharing, then you really create some progress.”
As a sample
As I sample his Nitro and Cold Brew coffees, Greg’s stories remind me of the unglamorous moments and the often long slog it takes to build something big. He doesn’t want to romanticize it, because sometimes your relationships and your health are at stake. But it’s easy for entrepreneurs to get discouraged during tough times, and it’s helpful to remind ourselves that it often takes years to become an overnight success.
Califia is Take Two for Greg Steltenpohl to change people’s behavior to more sustainable and healthy living. And it tastes to me like he’s on the right path.
Krisztina ‘Z’ Holly
