How I Leveraged NFTs To Build My Low-Sugar Soda Brand
Hello! Who are you and what business did you start?
Hello, I’m Vasa Martinez and I’m the founder of Perfy, a low-sugar soda enhanced with nootropics and adaptogens and up to 90% less sugar than traditional soda.
We’ve been testing product market fit in our first 5 months and have finally seen traction as all of our first production will be sold out as we service retailers like Foxtrot and Shoprite. We’ve seen tremendous traction with online marketplaces like Snack Magic and Amazon without any sort of ad spend.
We're about to break $75k without any ad spend. This is across marketplaces, our website, and retail. We aren't pushing until this next production run, where we tweaked our label to better serve us on the shelf.
What's your backstory and how did you come up with the idea?
I started my career in the service industry out of college. Graduating in 2007 was a rude awakening and I had to work three jobs to pay down student loans. After 5 years, I began my career in marketing as an unpaid intern at Quest Nutrition where I learned as much as I could as fast as I could.
After four years of that, I worked as a director of marketing at two emerging food brands and then started my agency. The agency quickly became a hot ticket in CPG, but it wasn't until all of the tragic events started happening that my "why?" evolved and I needed to take this next step.
Perfy will not win as a DTC brand, we have to win on the shelf.
Perfy’s story starts about 5 years ago when a series of tragic events happened in my life. In 2017 my mom was diagnosed. Later that year, my older brother Ralph had a stroke and is still partially paralyzed to this day. In 2018 I lost my best friend to an accidental fentanyl overdose and my cousin to diabetes. In 2020 I lost my old roommate of 5 years to suicide.
Then the pandemic hit.
And in that same time frame, I lost another dozen friends. As a result, I developed some terrible habits, put on a bunch of weight, and developed pre-diabetes (which I’ve since reversed). I needed to climb my way out. And in doing so I wanted to help others going through what I was going through.
So I created Perfy. A low-sugar soda for a happy you.
And I named it after my mom who is thankfully here to see it. When I was just two years old I’d say “hey ma you’re Perfy.” So I named the company after her.
Take us through the process of designing, prototyping, and manufacturing your first product.
Perfy started through an email to the top food scientists/product developers I could find. A lot blew me off. No idea why. But my top choice responded.
This was around February 2021. And we began the formulation of 3 SKUs in April. It was only two SKUs, but I loved what I tasted and added the 3rd one in the process.
The first three flavors are Tropical Citrus, Fruit Punch, and Blood Orange Yuzu, which is Perfy's version of Cactus Cooler, Hawaiian Punch, and Sunkist respectively. Our fourth flavor launches in the next 3 weeks and that's our version of Dr. Pepper. It's called Dr. Perfy and has my Doodles NFT on the limited edition can.
We finished formulation in August and then I began working on the branding. We ultimately went from idea to final product in cans in 8 months. We didn’t nail the label out the gate but I was able to learn quickly and implement all of the necessary changes for our next production run (August 2022).
How we did this by sending out tons of samples and taking orders in Q122. And then applied all the pertinent feedback for what I call Perfy 2.0.
Along with the refreshed label, we’re launching our limited edition 4th SKU “Dr. Perfy” in August. It’s very cool because it has my Doodles NFT on it and there will be perks for Doodle holders as well as Perfy Loyalty NFT holders.
You can create buzz by doing things differently. A good example is being the first soda with allulose in it. Being the first soda to put an NFT on a can. And the first soda to focus on brain health, not gut health.
Describe the process of launching the business.
We officially launched Perfy on 2/22/22 after 2 months of trial packs going out to learn how the customer talks about our product (and to see if they even liked it to be honest). We then set out to exhaust inventories via online marketplaces and other strategic forms of trial.
We used Faire, Mable, RangeMe, Snack Magic, and Amazon. Why those? Because those have the best track record for early-stage startups and I had to move fast. I think we stood out because of our branding and mission. We use a trial pack to entice trials online.
It's hard to get an online customer to commit to a 12-pack without knowing if they'll love it or hate it...even with a 100% money-back guarantee. The trial pack allows them to try one of each flavor at a nominal price ($4.99 shipping).
My goal was cans in hands, get feedback, implement Perfy 2.0 and then roll out into retail. Which is kind of exactly how it worked out.
The website is very clean and simple…kinda like Perfy.
I financed Perfy by selling crypto and stocks to put the first chunk of change in. Once I had a proof of concept and sent some benchtops around to friends and family, I began raising. Now I’m looking to close out the angel round and I think it’s pretty cool how much we’ve learned and adapted since launch.
At this stage, the goal is to find PMF. But we’ve done that earlier than anticipated and made the necessary changes not only to the branding but also to the product and our unit economics, which is HUGE.
Since launch, what has worked to attract and retain customers?
Our biggest unlock has been the way we've created a buzz. The buzz creates trial. The quality of the liquid creates repeat business. From there I can take the data and apply it to sales decks and investor decks so I can continue building the business.
The high-level takeaway is that you can create buzz by doing things differently. A lot of brands go into the space looking to do what competitors did to win. It's important to be distinctly yourself and take risks. A good example is being the first soda with allulose in it. Being the first soda to put an NFT on a can. And the first soda to focus on brain health, not gut health.
Perfy will not win as a DTC brand. It’s too expensive to ship, even with the efficiencies we’ve found for DTC. So we have to win on the shelf. And we have to win over retail buyers to give us a shot. Then I believe DTC will be more for retention rather than acquisition. For folks who want to stock up because they know they already love the product. Or for those who want to buy our limited edition flavors because they’ve tried the others.
To get Perfy on shelves, I worked with brokers and also have a great friend working in inside sales. I've learned that you likely want to do commission ONLY and not a retainer. The process is long, and when you have 6-8 months of fixed cost retainers on the books, it makes the payback take longer or maybe even impossible in extreme cases.
No matter what industry you enter, it’s going to be tough. The barrier to entry is high, but the reward is great. My advice is to not do it unless you are comfortable dedicating yourself to it. For that, you must have a strong WHY.
How are you doing today and what does the future look like?
Perfy isn’t quite profitable…yet. But we have a line of sight to profitability. We’ve reduced freight expenses by 18% and COGs by 20%+. We've also improved our margin by 325%. This allows us to focus on distributors and retailers while making the necessary margin needed to exist.
Being a solo founder and having a light cash burn helps. Come October, we should have our first profitable month on a CoC basis. And from there, our next traunch will be to unlock EBITDA positive.
Through starting the business, have you learned anything particularly helpful or advantageous?
I think the biggest mistake I made was rushing to the finish line. But it was a necessary evil. I needed to get the product to market to reduce cash burn without revenue. I didn’t have an endless supply. By doing that I was able to learn a lot about the business, how to talk about it, etc. So, as much as it feels like a mistake, it wasn’t. Yeah, the 1.0 label might not be there, but the learning and implementation have been much faster than usual from what I’ve been told. I made great decisions on the outsourced team that I selected. From Ops to R&D, and email to social (I own the agency that does our social too).
The biggest key was to dream big and JUST LAUNCH. But launch with intent. And I intended to learn and apply all of the feedback as quickly as possible to not waste a lot of $.
What platform/tools do you use for your business?
My marketing tech stack is Shopify, Postscript, Klaviyo, Triple Whale, Repeat, Skio, ShipHero.
What have been the most influential books, podcasts, or other resources?
For podcasts, I like E-commerce Marketing School by Privy.
For books:
- Forging an Ironclad Brand by Linday Pederson
- Founder Brand by Dave Gerhardt
- Ca$hvertising by Drew Eric Whitman
- Breakthrough Advertising by Eugene M. Schwartz
- Advertising Strategy by Derek D. Rucker
- Relentless by Tim Grover
- Can’t Hurt Me by David Goggins
Advice for other entrepreneurs who want to get started or are just starting out?
No matter what industry you enter, it’s going to be tough. The barrier to entry is high, but the reward is great. My advice is to not do it unless you are comfortable dedicating yourself to it. For that, you must have a strong WHY.
If your why is there, sales will come…provided you’ve done your research and there is a consumer need for your product.
Where can we go to learn more?
- Website
- @drinkperfy on all other socials
If you have any questions or comments, drop a comment below!
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