John Bello Tu’74 is the founder and former CEO of the South Beach Beverage Company, the maker of SoBe teas and juices. Currently, he is the managing director of JoNa Ventures, a family investment and venture firm that he co-manages with his wife, Nancy Bello Tu’75.
Your career has been wide-ranging and you’ve worked with companies in fields as varied as major league sports, food and beverage, and healthcare. How did your education at Tuck prepare you to work in all these different industries?
I have had the good fortune of a fun and fulfilling career, first marketing high-profile entertainment properties, such as the NFL, and then successfully creating my own brand in SoBe as an entrepreneur in a highly competitive environment and then selling that company to one of my competitors. . . "’tis a consummation devoutly to be wished." These were like hobbies to me, real dream jobs.
I was and am an ardent football fan (read: Redskins), so in my role at the NFL I worked to give fans what I as a fan wanted to see, feel, and have. This included being able to buy the same gear used by the players and coaches on the field, having a team credit card in my pocket, and being able to race with Darrell Green at the Super Bowl in a cyber sort of way. (Never could beat him, but I tried and tried!) That part was easy. Getting a hide bound, under-marketed entity with 28 disparate pieces to do it all—and do it together—was more difficult. It happened.
Building SoBe was in itself a total applied business school experience, a case study in every respect. The SoBe experience had it all: brand and product creation; marketing; operations; human resources (SoBe was the last refuge for the unemployed); lawsuits (Sonia Sotomayor and James Comey ruled for SoBe over AriZona Tea among others); fundraising for startup costs and ongoing financing; and ultimately negotiating with strategic acquirers. Then came the exit scenario and dealing with the corporate buyer. Business school helped prepare me for it all, but there is no better preparation than the caldron of experience.
As a history major who spent four years in the Navy (including a year on the rivers in Vietnam) to fulfill a NROTC military obligation, I looked to business school to shift into another career, as did many military types during that era. I was introduced to Tuck by a fellow officer who went to Dartmouth. Therein lies the most important aspect of business school for me: the resultant network generated in and around Tuck. I learned the textbook aspects of marketing—and they later came to life at General Foods and Pepsi—but what I truly got out of Tuck was learning to focus on what is important in an overloaded and complex work and life environment. In addition to the intellectual challenge posed by the overstuffed curriculum and accomplished, motivated students all looking for the same thing (a great job), Tuck created a situational challenge that helped me develop organizational and time management skills.
Tuck helped me learn to cope in a highly competitive environment. While at Tuck I worked full time in the admissions office to help support the home that Nancy and I bought in West Lebanon with the spoils of my tax-free year in Vietnam. Add to that all of the extracurriculars and the joys of Hanover, Tuck prepped all of us for an overstuffed life in corporate America.
As it happens, the friendships I made at Tuck helped me in the founding and success of SoBe and throughout my career. One couple became early investors and made a multi-million dollar return based their trust and confidence and friendship in Nancy and me.
You founded SoBe after leaving the NFL. How did you make the decision to break into beverages and how did your experiences before founding the company lead you to success?
The NFL was a dream job. Football was a sport I loved and understood. I even applied to the Redskins for a marketing position while at Tuck. I was introduced the NFL while at General Foods working on Sanka decaffeinated coffee (read: healthy beverage as a prelude to SoBe Healthy Refreshment). My mentor at General Foods encouraged me to build an NFL program around a brand that was targeted at older people, mostly women. Therein comes the “marketing disruptor” part. The resultant program was a huge success. The people at the NFL noticed and ultimately reached out to me when there was an opening in marketing. Coincidentally, that same mentor became are early partner at SoBe and went on to earn multi-millions, which he subsequently turned into a huge marketing success with Blue Buffalo. Again, networking is sometimes the ultimate key to success.
At the time, NFL was a “product” waiting to be commercialized and exploited, and I was the guy to do it. I had free reign to make the things that I as a fan would like to wear, see, and do related to the NFL. Although it was difficult breaking through the hidebound “it’s football” and although crass commercialism and exploitation were not welcome in the league office, the NFL owners (a group of rugged individualists I came to admire) loved the revenue generated by NFL Properties at a time in which it was sorely needed. And they loved the attention and fan enhancement it brought to the game. Incoming revenues blossomed from $6 million when I joined to over $350 million when I left 14 years later. A lot went into that—timing, the rise of TV, interest in sports—but mostly it was the team that we put together at NFL Properties that drove the business.
There it is, the team. But you have to start with a great property, and there’s nothing greater than the NFL. It was easy to sell once we packaged it and committed to helping fans enjoy the game. Fans were ultimately willing to pay $150 for an authentic game jersey vs. a flame retardant tee shirt at Sears for $20 with flat graphics. The fans wanted to "wear what the pros wear” and were willing to pay for it, yielding big royalties to the league.
Do you remember Mike Ditka wearing the Bears sweater at Super Bowl XX in New Orleans? It was an iconic image that sold thousands of those sweaters. We worked with more than 350 companies in disparate industries—from trading cards, chocolates, and automotive accessories to credit cards, training table foods, and toys of all types. I loved these entrepreneurs because they did what they had to do to win. I helped them with an NFL license and did much to support them. Many became millionaires. I learned from them how to build businesses and negotiated on the other the side of the business with them. It was a great experience.
On the corporate side, NFL Properties took a page from the Olympics and worked with all the huge corporate sponsors from Coke and Pepsi to Kodak and Apple. We worked with them all to help drive and build interest in their brands with borrowed interest from the NFL. They ultimately spent their money (and are doing it today) to promote the NFL.
Bottom line, the NFL was an entrepreneurial experience for me. I learned from the owners and the licensees (most were entrepreneurs). I was exposed to a broad range of products and entertainment properties and learned the commonalities among them all. I met thousands of people because having an NFL business card was the best calling card. No one turned down a call. I helped develop games in Europe, put magazines together, and worked on special events like the NFL Experience and Race with Darrell Green. We even launched a trading card company when Topps refused to pay the NFL a licensing fee—and it revolutionized the industry.
Nothing good lasts forever and my time at the NFL, while fun, was losing its luster as times changed and new people arrived on the scene. It was time for me to venture out on my own. I had acquired a portfolio of experiences from Tuck forward, and the network of people who could help me, and a small nest egg. Given the success of Snapple, AriZona, and other designer brands, beverages—not athletic apparel—was the path that this “terminally unemployable” and yet-to-be-proven entrepreneur took.
One thing all your business endeavors have in common is that they are all related to health and wellness, whether through the drinks we consume or the athletes we look up to. What advice would you give to someone with a passion for health as they begin their career?
This answer will be shorter. Health and wellness is not a trend, it’s a cultural shift. I saw it coming when working on Sanka at General Foods. The irony is that Sanka was made from the cheapest coffee beans, decaffeinated with a chemical solution, and then sold for 10 cents a pound more than regular Maxwell House. And we made money selling the caffeine to Pepsi and Coke to put into their colas. That said, I am not a health purist.
SoBe was promoted as a healthy refreshment, an elixir imbued with the vitamins, minerals, and herbs that were becoming popular at the time as health enhancers. In reality, SoBe was sugar water, albeit all-natural sugar water that provided 100 percent of your daily dose of placebo. The real health benefit of SoBe was the “feel good” factor: the edgy marketing around the lizard that made people smile. The products tasted great, were exotic, and came in big bottles with fun names and under the crown slogans like "The Good, The Bad, The Lizards" and "It’s in the Crate," whatever that means. SoBe’s fourth dimension was fun and excitement in a category where the competition featured Wendy and cacti.
At SoBe again, it was about the team. We were the last refuge of the unemployed but our team was committed. Because everyone had a slice of equity, they worked diligently and the brand benefitted from a lot of discretionary time. That happens in winning scenarios.
SoBe spawned a whole movement in “better for you” beverages. I can’t say that any of them are healthy or even healthier because of nutrient enhancement. Water works as a healthy beverage, so does beet juice, coconut water, pomegranate juice, and other foul-tasting brews like kombucha and castor oil. What makes the soft-drink category work is sugar, which is coming under attack. There’s an opportunity there: create great taste and mouthfeel in a food or beverage with no sugar calories. But it ain’t gonna happen. Taste is sacrificed without sugar.
There are more opportunities now in that health space with the rise of Whole Foods and natural sections in the mass grocery channel. There are many new products; a few successes and many failures. A new business concept needs to rise above the competitive clutter. This is almost impossible to do.
There was nothing healthy about my role at the NFL except for the fun it provided fans and the money it made for licensees, retailers, the NFL, and the players. My job there—and what brought me success at SoBe—was delivering the right product at the right time. That is a key to success: great products, combined with commitment and resources, because vision without resources is insanity. At both the NFL and SoBe, we created excitement and built career paths for many who went on to significant corporate, entrepreneurial, and sales roles in both the sports industry and food and beverage sector. I am most proud of that, because you can’t win without a well-led, motivated team.