Building an energy-powder empire: on Reize and its founders

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When Marty Spargo, founder of REIZE came back to Australia, he felt there was something missing. Every time he went to a grocery store in Indonesia, he was given a bevy of drink options to choose from: energy drinks, fruit-flavoured drinksall sorts. But in Marty’s local supermarkets, these options were nowhere to be seen.

After a year of incubation and planning, Marty and co-founder Steve Macdonald decided they would launch their own startup dedicated to filling this niche. The resultnow a thriving business called REIZE, is the world’s first subscription-based energy drink service that aims to change energy drinks for the better.

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Marty’s career didn’t start with entrepreneurship. Before the hype of his energy drink business, Marty was an avid surfer and gym enthusiast with a keen obsession with anything outdoors. His love for the outdoors hasn’t changed – even to this day he can be found at the beach going for a quick swim or surf before coming into work. At one point he even dreamt of becoming a professional NBA player.

In high school, he was so hooked on surfing than in order to maximise his free time, he wanted to become a pilot.

“With about three months left in high school, I went to a careers fair and met some Qantas pilots. At that point, me and a mate decided—“Oh hey! These guys get paid of lot of money and they’ve got a lot of time off! We can go surf a lot and travel the world. That’s fun!” And at that moment, I decided I wanted to be a Qantas pilot.”

“That decision drove me. I really didn’t try that hard in high school. I didn’t study and didn’t like it even though I got A’s and B’s all the way through. I just wanted to surf. But from that moment when I decided I wanted to be a Qantas pilot, I started to apply myself. So after school finished, I started to study and work hard until five years later when it actually happened.”

The idea to start a powdered energy drink took about one to two years to incubate into a full-blown business plan. In-between travelling to Indonesia and testing out a few different job opportunities, he would research the soft drink market, compare brands and even scout out the regulations needed to sell a drink in Australia. What he found from his research was striking:

“There were certain energy drinks which would give you a sugar crash. Others would give you a caffeine rush, which meant that gamers would be shakier after taking it. Nothing was a great option.”

He also realised that energy drinks were pricey, but not because they had to be.

“A lot of the cost of an energy drink is down to the water content. Because retail energy drinks need water, companies spend lots of money basically shipping water around the country. You can imagine that jacks up the price far more than the amount the drink needs to cost.”

Though the gap in the market was clear, the vision of starting REIZE took a while before it could become a real business. It wasn’t until the pair felt confident with the amount of capital they had in hand that they decided to take the risk.

“We lived and breathed it for a long time” Marty mentions. “Today, I think we’re the experts on anything related to energy drinkseven bypassing many of the experts we turned to in our early years.”

Despite the uncertainty of starting a company, Marty was near certain it would succeed. In hindsight, he realised this certainty was overblown, but there’s no doubt this all-in approach helped him and his cofounder clear the early obstacles of gaining first customers, developing their product and managing the legal frameworks necessary to run a business.

But as REIZE grew, the pair began experiencing many of the challenges that startups face on a daily basis. Marketing was the hardest field for Marty to learn. Google Adwords, Facebook advertising and website development were all black boxes for him, and the duo spent a long time trying to break down what these mediums could do to increase their customer base. 

Above:  The Deadpan Guy campaign.

Earlier in 2017, the pair ran a viral marketing campaign featuring the memorable character Deadpan Guy. The team spent more than $20,000 on production and its promotion through Facebook ads. But despite a view count of over 2.2 million, he admits this wasn’t the breakthrough moment for his company.

“It’s a rollercoaster.” Marty says. “At the beginning of any campaign there’s this excitement about what might happen. It took us a while to accept that those expectations of success were not always realistic”.

“One day we would have about five sales, and the next day it would drop and drop until we were back to nothing, or a sale every few days.”

Instead of viewing the process through individual campaigns, Marty says it’s important to look at things holistically. “Campaigns are always underwhelming,” he says. “But we know that once people discover us they’ll love our product.”

What I wish I had known before we started Reize

When asked what sort of advice he would give himself back in the early days of REIZE, he said three things:

The first: Be persistent.

“We’ve tried everything. Anything that we’ve thought up. Anything that other people recommended. We made a lot of mistakes, and that’s how we got to where we are now.”

Number two: Say yes to things you wouldn’t say yes to.

“I can think of so many times when we went to an event, or met up with someone and thought beforehand, “This is a waste of time.” Then it turned out that the meeting or event led to an important partnership. You never know what you will get when you say yes, but it’s always better than not trying.”

The third: Be honest with yourself.

“You need to continually reassess not only the big picturewhether your entire business is working, but also each individual thing or campaign you’re working on, and whether you need to iterate or optimise so that you’re getting the best out of working on.”

And lastly, as an afterthought: find something so passionate that you can’t say no to.

“There has never been a single doubt in my mind that it would fail. Failure was never an option.”

So where to from here?

For REIZE, capturing the Asian market is an important stepping stone after growing their roots in Australia. With Marty’s love for Indonesia and REIZE’s base at Haymarket HQ, the opportunities to engage with the Asian market are endless.

However that’s only the beginning of REIZE’s story, very soon REIZE will be taking on the world.