Gamer's grog: creating a new beverage brand is a rare achievement, especially for an independent. But Miami Beach entrepreneur "Hoby" Buppert has managed to muscle into a unique niche with his mega-caffeinated soda - Entrepreneurs

South Florida CEO, March, 2003 by Julio Garcia

If you walk in to any one of the 200 CompUSA stores nationwide, you won't find six-packs of Pepsi or Coke stacked in the gaming sections. But you will find six-packs of BAWLS, a super-caffeinated soda that has become the drink of choice for serious computer gamers.

The brainchild of 29-year-old Baltimore native Hobart "Hoby" Buppert, BAWLS is based on the guarana berry, which grows in the jungles of Brezil and Venezuela. While guarana-based soft drinks comprise 25 percent of the Brazilian soda market, in the US they are practically non-existent.

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All the better for Buppert, who concocted the idea for his drink while still a student at Cornell University. "I needed four credits during my last semester, so I asked my favorite professor if I could do an independent study on a business plan for an idea that I had for a new bottled beverage," says Buppert.

In 1997, a year after graduation, Buppert borrowed $200,000 from Bank of America (collateralized with family assets) to launch BAWLS. That year it sold 12,000 cases. Last year, it sold more than 500,000 cases in the US, Scandinavia, Greece and the United Arab Emirates.

Produced by Hobart's Miami Beach-based Hobarama Corp., BAWLS comes in 10-ounce cobalt blue glass bottles with bumps that provide a distinctive look and good grip. Each bottle retails for about $1.29. While its price and packaging more closely resemble an energy drink--a la Red Bull--than a soda, Buppert is quick to point out that it's definitely not positioned as one.

"The energy drinks contain vitamins, minerals and herbs that are supposed to be helpful and have a distinctive flavor that's difficult to mask," he explains. Instead, BAWLS, with a taste reminiscent of cream soda enhanced by a hint of citrus, is marketed as a unique, high-quality soft drink with 80 milligrams of caffeine per 12 ounces. That is more than double the amount in Coke and the equivalent of two 8-oz. cups of coffee.

The majority of BAWLS drinkers today are computer gamers, many of whom consume it in large quantities at BAWLS-sponsored "LAN" (Local Area Network) multiplayer computer-game tournaments that typically last 24 to 48 hours. The company began sponsoring these events after being deluged with e-mails following an article that appeared on a popular computer-game website in 1998.

Buppert immediately recognized that his drink had found its core consumers, and so initiated unconventional sponsorships with LAN-party organizers. They accomplished two goals: building strong brand awareness and generating revenue.

For a typical sponsorship, BAWLS provides a free case of the drink to the winner and a large paper banner with the event's name and the company's tagline, "Fueled by BAWLS." It also provides the organizers with wholesale pricing, so they can order quantities for resale during the event. The company now sponsors up to 20 LAN parties nationwide each weekend, which account for five percent of sales.

According to the Cyberathlete Professional League (CPL), the leading organization for computer gamers, BAWLS is now considered the "Gatorade of the Cyberathlete." BAWLS is a sponsor of the CPL and its annual world championship, which in December 2002 had more than 1,400 participants.

"Lots of beverages try to get a cult following and an irreverent, edgy image, but trying and succeeding are very different in this business," says John Sicher, editor and publisher of industry periodical Beverage Digest. "BAWLS has created an identity and received some attention. It's off to an interesting start."

Sicher says the key to BAWLS's longterm success lies in achieving a strong national distribution, something "that's extremely difficult to do for an independent in this industry." Buppert now has deals with bottlers in Newark, St. Louis and Los Angeles, as well as with 50 distributors in 31 states. But he says bottlers and distributors are wary of independent brands that can be acquired--and taken away--by the industry's three giants, Coca-Cola, Pepsi and Cadbury Schweppes.

That is not out of the question; Pepsi recently purchased independent SoBe for $400 million. "We've already been approached by investment groups doing beverage roll-ups to resell to the giants, but not by the giants themselves," says Buppert. "Right now, I think we can do it better without them."