Loyola Marymount University grads trying to take hangover remedy to the big leagues
It was 2012, and a group of college buddies from Loyola Marymount University in Westchester had gone their separate ways.
While living it up in Las Vegas, Cameron Killeen noticed friends nursing their hangovers with Pedialyte — a hydration beverage meant for babies with diarrhea.
Brandin Cohen was in Arizona, working as a sales, marketing and branding expert with the Arizona Diamondbacks baseball team. In the locker room, he noticed players swigging a drink to stay hydrated. He took a closer look: Pedialyte.
When Killeen, Cohen and a third pal, Hayden Fulstone, reconnected, the recent grads swapped their Pedialyte stories and an idea was born. Why not create a drink that not only alleviates hangovers and rehydrates the body, but also spares the consumer the embarrassment of making a run to the baby aisle of a grocery store?
And thus was born the concept for what would come to be called Liquid I.V.
Advertised as “all natural lemon-lime rehydration beverage,” the product comes in two forms: a powder packet and a bottled drink that tastes a little bit like lemonade, a little bit like Gatorade, and a little bit like Emergen-C vitamin powder.
The powder form is billed as the hangover treatment; the liquid form is associated with the hydration, which is meant to appeal not only to athletes, but also military personnel and jet-lagged travelers.
“It started as a hobby,” Cohen said.
Now, it’s their life.
The three 25-year-old entrepreneurs — who graduated in 2010 and have been best friends since meeting in the dorms as freshmen — have put their careers on hold to focus full-time on their venture.
Fulstone quit his job in the marketing department at Gensler, the world’s largest architecture firm. Killeen had just passed the Chartered Financial Analyst exam for which he’d spent four years studying. Cohen was days away from moving to Boston University, where he had been accepted into its MBA program.
“Now we sit in a little room all day long and yell at each other,” Killeen joked.
They work out of an office in West Los Angeles, and store the product in a warehouse and distribution center in Long Beach.
Already, Liquid I.V. is sold at about 50 stores in and around the South Bay — mostly convenience stores and gyms such as El Segundo Athletic Club and Fit On Studios in Manhattan Beach.
Strong sales via the Internet (where eight packets sell for $24.99) and a healthy amount of capital investment have propelled them to the next level. Come mid-January, Liquid I.V. (powder) will be sold at about 150 convenience stores in and around 35 college campuses across the United States, from UCLA and USC in Southern California to Dartmouth in New Hampshire. They will hire three full-time employees.
Liquid I.V.’s initial sales data and online traction have caught the eye of business people in Las Vegas, the very city where the concept was conceived. In March, the trio will meet with representatives of a large hotel chain that — depending on the results of the upcoming launch — might sell the product in mini bars up and down the Las Vegas Strip.
Much of their success to date owes to a clever marketing campaign that befits a group of millennial men with pro-sports connections.
Liquid I.V. is used and marketed by more than 100 professional athletes — including St. Louis Cardinals pitcher Michael Wacha, winner of the 2013 National League Championship Series Most Valuable Player Award. The athletes receive the product for free in return for touting its merits on Twitter, Facebook and other forms of social media.
Their nexus to the Major League Baseball circuit was Ryan Wheeler, a Torrance wunderkind and LMU alum who went on to play for the Arizona Diamondbacks before he was traded to his current team, the Colorado Rockies. Wheeler is now a partner in the company. Another enthusiast is famed basketball broadcaster Dick Vitale.
“It’s a great way to get a bigger following,” Fulstone said of the pro-athlete campaign. “Some have 50,000 or 100,000 followers (on Twitter). People see the Tweets and check out the website.”
Much as the pro players pimp the product online, students living near the college campuses where Liquid I.V. will be sold are set to serve as “ambassadors” who’ll spread the word to peers in return for receiving loads of it for free.
The LMU graduates owe some of their success to their alma mater. Last year, they enrolled in a new business incubator class offered by the university. The class, which kicked off in January, required businesses to create and market a prototype.
It was during that class that they, working with an experienced beverage chemist, finished the brew, a specific blend of glucose and electrolytes that the three founders say is clinically proven to rehydrate the body at a rate similar to an I.V.
So far, the track record of the seven start-up ventures that took the first class is pretty good: five are still in business.
One of them, a Web-based car-buying service called Nabthat, launched last week with some fanfare at the L.A. Auto Show.
Another, an ergonomic shovel, brought in $60,000 in seed money from a 40-day campaign on the crowd-funding site Kickstarter — putting the venture in the top 5 percent of successful Kickstarter projects.
Fulstone is careful to say that the beverage isn’t a “cure” for anything.
“When you say cure, it is stating that there is a disease and a hangover isn’t a disease,” he said. “We can only make structure-function claims such as what the drink helps with.”
But the group has gotten doctors to recommend it in lieu of more sugary drinks such as Gatorade.
To say the three friends spend a lot of time together is an understatement. In addition to having been dorm pals and roommates, they each clock in about 80 hours a week at the office.
“When we first came into the office, they told us it was only open from 8 to 5, Monday through Friday,” Killeen said. “We were like, I don’t think we can be here if that’s true. We had special keys made.”