Nexba: a 10-year overnight success story
Nexba, a naturally sugar-free range of drinks created by two brothers-in-law, is now a major disruptor in the Australian healthy drinks space, with products also making waves overseas. But while the brand’s success might seem to have happened overnight, the men behind it have been working on product development for the past 10 years.
The Nexba story all began back in 2010 in Mexico, where a then-23-year-old Drew Bilbe – now Nexba co-founder and co-CEO – was taking part in a university student exchange program while studying his civil and environmental engineering degree.
“While I was there, the better-for-you-beverage space really stood out,” Bilbe says. “It was much better developed in Mexico. I honed in on iced tea at time and did some research, and found out that iced tea made up about 12 to 14 percent of Mexico’s entire beverage sales, across both retail and petrol and convenience [P&C]. That was pretty mind-blowing.”
Let’s give it a crack
At the time in Australia, the only iced teas available were Lipton and Nestea, and these brands were only capturing about one to two percent of beverage sales. Bilbe felt that there was opportunity in Australia to build the better-for-you-beverage category.
“I think Australians didn’t resonate with the iced teas we had here because they were full of sugar,” he says. “Outside of iced tea, all we had was vitamin waters, and I don’t think people were being fooled; they knew it was a marketing ploy, as they were also full of sugar.”
When Bilbe returned home, he approached his brother-in-law Troy Douglas about developing their own range of sugar-free drinks, asking if he wanted to “give it a crack”. Douglas agreed, and they began with market research before spending all the money they had on a container of canning machinery, importing it from China to the Sydney suburb of Hornsby. The pair then spent the next six months working out how to make iced tea. But from the very outset, they wanted it to be very different to what was already on the market.
“It had to be sugar-free,” Bilbe says. “And we wanted it in a can rather than a PET bottle.”
The special effect
Producing an entirely new product with no industry experience took an enormous amount of research, with the pair basically learning about the entire beverage supply chain on the job, with the support of mentors and family members. But in 2011, they had their first product – a watermelon iced tea – and they hit the road in search of a national account. Eventually, after selling drinks out of the back of a van on Bondi Beach for a while, they won an account with 7-Eleven, which began selling their product in 650 of its P&C outlets.
“At the time, iced tea was their most stagnant category,” Bilbe says. “But after we launched, it turned into their second-highest growth category, and we were contributing 60-70 percent of that growth. So we really felt like we had something special.”
Blends with benefits
Even with this impressive résumé behind it, Nexba wasn’t yet able to crack the big supermarkets. So Bilbe and Douglas decided to make their next move – perfecting their natural sweetener blend, which they’d been working on for several years.
“We hadn’t yet launched that to market,” Bilbe says. “So we went about refining it. At the time , we had maybe 1000 iterations of what we now have – our patented blend of natural sweeteners and flavours. They emulate the mouthfeel and the taste of sugar.”
Many natural sweeteners provide a huge spike of sweetness, but don’t quite give the experience of sugar. However, by combining natural flavours at the right time as Bilbe and Douglas have done, the body will perceive the taste, mouthfeel and sweetness level of a sweetener as sugar. It took a massive amount of trial and error, but the Nexba natural sweetener blend is now patented globally – a huge achievement.
By 2017, Nexba was in both Coles and Woolworths with its expanded range of iced teas and sparkling waters. The following year saw the launch of Nexba kombuchas, and the range now also includes apple cider vinegar soda, soft drink, kefir, switchel (a blend of water, ginger, apple cider vinegar and sweetener), tonic water, probiotic soda and probiotic water.
The proof is in the probiotic
Probiotic drinks are one of the fastest growing drink categories, but just like their iced teas, Bilbe and Douglas wanted their probiotic drinks to be entirely different to other offerings.
“There are lots of different types of probiotics, but we wanted one that was actually going to be beneficial for the body,” Bilbe says. “Not all probiotics are created equal. Some don’t like changes to humidity, acidity and temperature. The majority often don’t survive the journey from the supermarket shelf to your mouth and down to your gut.”
The team eventually found a special probiotic strain known as Bacillus coagulans, which is encased in a hard protein-like shell, so it survives the journey to the gut.
“We guarantee at least 85 percent of the probiotics in our drinks will make it to your gut alive,” Bilbe says. “The strain we use is a lactobacillus which is not yet germinated, and if the acid levels are right, it won’t germinate in the can. Once you drink it, the shell protects it until it reaches the gut – a warm, acidic environment where it then germinates.”
The pair weren’t comfortable putting products on the market which they weren’t able to make health claims about. So, before they launched their probiotic range, they had the products tested, getting a claim approved with Food Standards Australia New Zealand that their probiotic products promote gut health. Nexba’s kombucha is now the number one kombucha in Australia and the number one kombucha in grocery stores in the UK.
Get up and go
Obviously not the types to rest on their laurels, this year the team behind Nexba has also expanded into an entirely new category – liquid breakfasts – going head-to-head with the major player in the liquid breakfast market, Sanitarium Up&Go.
“Ours is the first naturally sugar-free liquid breakfast on the market,” Bilbe says. “The competitor currently has 99 percent of the market, but the category isn’t growing. We believe the main reason for this is the sugar that most liquid breakfasts contain.”
Liquid breakfast is only one of many next steps for the dynamic duo behind Nexba. Their patented sweetener blend is capable of being used in a variety of foods and drinks, which means it’s only a matter of figuring out what to launch next, and when.
“We’ve developed a massive innovation pipeline, so there’s a roadmap for us to launch these things at the right time,” Bilbe says. “But for now, we still need to build the Nexba brand. It will be a big job to build brand awareness and really grow our core products.”
Facing every hurdle
It’s been a pretty remarkable journey for Bilbe and Douglas thus far, and while it has certainly been challenging, it’s also been incredibly rewarding.
“It’s a 10-year overnight success story,” Bilbe says. “But we’re just at the beginning. Our vision is to make a naturally sugar-free alternative available across multiple categories.”
Bilbe is the first to admit that he and his brother-in-law were naive when they first began, but he believes that naivety can be a powerful tool when starting a new business.
“Particularly when you don’t already work in the industry – you don’t realise the hurdles and the challenges,” he says. “But I think if we did know everything we were going to be up against, we might have thought twice. As it is, we’ve taken on every hurdle and found a way around it. That’s an attitude you need to have when you’re up against the big competitors.”
The Nexba range is now available in Coles, Woolworths, Costco, independent supermarkets and petrol and convenience stores. To find out more about Nexba, head to nexba.com