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Muskegon sparkling water company pivots to e-commerce during pandemic COURTESY PHOTO

Muskegon sparkling water company pivots to e-commerce during pandemic

BY Friday, August 28, 2020 05:05pm

MUSKEGON — New investors were aligning this past spring to back a capital round for HyVIDA Brands Inc.

Then along came the coronavirus, sending away prospective investors who decided instead to use their capital for existing portfolio companies because of the economic uncertainty from the pandemic.

That caused Rick Smith to return to existing investors for capital and to reassess the path forward for the Muskegon-based maker of hydrogen-infused sparkling water.

“Once COVID hit, everyone stopped investing,” said Smith, co-founder, president and CEO of HyVIDA Brands. “All of them said, ‘We like your product and we like what you’re about. We don’t know how bad this is going to impact the economy and we don’t know how this is going to impact retail sales.’”

HyVIDA was able to secure a “decent amount” of additional capital from existing investors and their networks, Smith said.

Operationally, the company scaled back plans to expand distribution on the West Coast and to focus primarily on Los Angeles and the Bay Area, delayed the introduction of a new flavor, and “doubled down” on e-commerce, Smith said.

The e-commerce strategy worked. Sales of HyVIDA’s sparkling waters have since grown 140 percent in six months, Smith said.

The company as well moved onto a business-to-business e-commerce platform, Faire.com, that sells to thousands of niche and boutique retailers across the U.S. and has generated repeat orders. HyVIDA also has been invited to sell on another e-commerce platform, bitewell.com, that’s designed for health and wellness brands recommended by nutritionists, Smith said.

E-commerce sales since a year ago have doubled and HyVIDA partners also are “entertaining multiple licensing opportunities in the U.S., Europe and South America,” Smith said.

“COVID impacted us a little bit and caused us to pivot and change and it made us stronger,” he said. “It made us learn and made us look at more pragmatic ways to get to the customer. We’re excited about the future.”

Smith and his partners formed HyVIDA Brands in early 2018 after he learned about the health benefits of infusing hydrogen into water. They launched production that spring with a contract canner in New Jersey, and HyVIDA began selling in retail outlets in August 2018 with organic raspberry, organic lemon lime and unflavored products. 

In addition to online sales, HyVIDA today sells in hundreds of retail stores across the U.S., including niche and premium retailers and 40 Meijer Inc. stores, up from about 30 a year ago. Walker-based Meijer is also testing HyVIDA in a healthy living section at its gas station and convenience stores, Smith said.

The brand has “great traction” in the Midwest, he added.

HyVIDA plays into a burgeoning market for sparkling water. Grand View Research Inc. expects the global market for sparkling water — estimated at $21.51 billion in 2019 — to grow at a compound annual growth rate of 11.8 percent through 2027 to $59.67 billion as consumers increasingly move to healthy alternatives to sodas and sugary drinks.

“Moreover, this sparkling or carbonated water contains a good amount of minerals, such as magnesium and calcium, with a number of health benefits,” according to the Grand View research report.

Infusing HyVIDA with hydrogen and magnesium differentiates the brand from others on the market, Smith said. He cites clinical studies affirming hydrogen’s health benefits as an antioxidant while promoting improved metabolism and clarity and alertness.

HyVIDA plans to seek additional capital as investors begin to re-engage. The wellness component of the company’s sparkling water can add to the appeal, Smith said.

“It transitions us, to some degree, to a life sciences company,” he said.

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