Back in 2010, Drew Bilbe was on a beach in Rio Nexpa, Mexico, sipping a cold, homemade iced tea, when he had an idea. Why couldn’t a commercial soft drink be made from totally natural ingredients and have less sugar?
It was a big idea for an early twenty-something, but when he got back to Sydney he popped the business question to childhood friend Troy Douglas, and the spark for Nexba’s lower calorie iced tea was born.
Neither had any experience in beverages or fast-moving consumer goods (FMCG), but both knew they had a good concept – soft drinks that were better for you. To make their start-up idea a reality, they sought advice from successful people in the FMCG industry.
“We picked their brains to get support and challenge our own ideas,” says Douglas.
“We wanted to make sure that when we made decisions with products, or entered new markets, we did it in a way that would allow us to be a start-up that didn’t lose too much money and could self-fund.”
With the help of their families, they acquired a small canning factory that produced 100,000 units in 2011. They made iced tea in flavours of watermelon and peach, and included sweet stevia extract to cut down on sugar.
The pair started selling Nexba iced tea in 355ml cans to cafes and school canteens from the back of a Kombi van. They were an instant hit, flying from fridges almost as fast as the pair could fill them. They realised they needed to start scaling the business quickly.
Peter Baron, inventor of the Sipahh milk flavouring straws, took a share in the company. This allowed Bilbe and Douglas to sell their factory, outsource the beverage manufacturing and focus on marketing the brand.
Nexba got its first big win in April 2012 when it launched into 7-Eleven stores. In December 2014, the brand made it into Coles. Today it’s also stocked in Woolworths.
Last financial year the company had sales of $2.3 million, and Douglas expects to more than double that this financial year.
The cool drink brand is cutting through where some larger brands are losing their fizz, and that’s one of the reasons it was named the 2015 Telstra Australian Micro Business of the Year. The judges were impressed at how the business has thrived in such a tough and competitive space, and described the duo as great role models for young entrepreneurs.
Their passion for sustainability – all of Nexba’s packaging is fully recyclable – especially stood out.
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Make your product stand out
Bilbe and Douglas want Nexba to own the ‘better for you’ beverage space. Unlike larger soft drink brands, all of Nexba’s range includes only natural ingredients and is lower in calories.
This clear vision has helped in promoting goodwill among customers and attracting talent. “The story and the excitement are there,” says Douglas.
“For instance, our commercial director – formerly at Pepsi Co – was attracted to our vision, our story and our clear knowledge of where we want to take this brand.”
Distinctive branding at point-of-sale has been very effective. “Make sure your products stand out – that is your biggest marketing tool,” Douglas advises.
Social media campaigns have also been very successful. For example, when Nexba launched its iced tea line in Coles in 2014, they partnered with Adelaide band At Sunset to promote Nexba to the band’s million social media followers. The Nexba pair challenged the band to a selfies contest in Adelaide’s Rundle Mall, to see if they or the band members could collect the most in 30 minutes.
“The campaign was a huge success with lots of people coming to Rundle Mall to be a part of the challenge. Our social media following organically grew, and Rundle Mall Coles was the top-selling Coles store of Nexba four-packs nationwide,” says Douglas.
Digital natives in the cloud
As Nexba’s founders are both still in their twenties, it’s no surprise that they embrace cloud software and mobile technology.
“Using cloud accounting software Xero has been one of the smartest decisions we’ve made,” says Douglas. He uses it for invoicing, tracking sales and more, and it also allows him to see at a glance all the figures that are important to him.
They can access Xero in their office, on their laptops or their mobile phones, anywhere there’s mobile coverage.
Their mobile phones are on the Telstra Mobile Network, Australia’s largest mobile network, and they take full advantage of this connectivity. “Whether it be working from our office desk or the airport lounge, we are able to send emails, upload files to Dropbox or complete orders anywhere[that has an internet connection],” says Douglas.