2011 INC. 5000 RANK: 1336
HEADQUARTERS: Bethesda, MD
YEAR FOUNDED: 1998
2010 REVENUE: $71.7 million
In 2001, Seth Goldman went to a small South African village to find tea. He loved the farmers who grew it. They had pooled their resources together to start the crop and now wanted to sell. He knew immediately he wanted the plants for his company, Honest Tea. "I was so inspired by it that I said, 'This is exactly what I want to build,'" he said at the Inc. 500|5000 Conference.
From those tea plants, he created a drink called Harlem Honeybush, named after the village, Harlem, and its tealeaves, honeybush. But when the product went to market, it tanked. For a while, he took the product's failure quite personally and wondered why customers didn't care about it as much as him.
Goldman eventually realized he had made a product for himself, not for his consumers. It was unsweetened and had a caustic taste. Goldman had failed to understand his customers. Afterall, they had never been to Harlem, South Africa to met those villagers. They simply wanted a drink that was enjoyable.
Honest Tea pulled Harlem Honeybush, and developed it into a new formula, adding pomegranate and goji berry. The new product launched the next year. The pomegranate added functionality–hyradation. It was sweeter now too. It was a big hit. Now, Honest Tea buys more honeybush tea than it did using the old Harlem Honeybush recipe.
"The lesson there for me was, you have to make this work for the consumer," he said. "If it doesn’t mean anything to the consumer, then you’re not achieving your mission."