Econ Student & Biology Major at UC San Diego Launch Beverage Company

Michael Young and Ed Jean-LouisUC San Diego students Edward Muallem and Yaniv Shemesh recently launched a beverage company despite no original intention to go into the food and beverage industry. Inspiration for their company came while studying for their calculus exam in the library. With support from The Basement, one of UC San Diego’s accelerators, they recently launched Mi Mate, an authentic, organic yerba mate beverage company.

Q: Tell us about your background.

Edward: I’m a hapa; I’m half Korean and half Iraqi Israeli. I was born in Sacramento, California, and grew up eating a mixed plate, kimichi, koubah, kofta kabob. I'm a human biology major. Beverage is not my specialty. As a student, I've always been interested in developing something and building ideas....I think that's really cool. 

Yaniv: I'm a second year student studying economics at UC San Diego. I was born and raised in the San Fernando Valley in California and never thought that I'd be in the food and beverage industry.

Q: What inspired you to start Mi Mate?

Edward: Yaniv and I came up with Mi Mate while we were studying for our multivariable calculus exam in the library last spring. We saw a lot of people drinking commercial yerba mates since it was cramming time and they needed energy. We started doing some research online and realized that there’s a lot of potential to make money in the organic beverage business. We wanted to make a better yerba mate, one without 28g of sugar per bottle, mate extract, juice concentrates, natural flavors, or preservatives. Also, I figured starting a yerba mate company would be a cool way for me to interact with a lot of professionals and pursue an idea into fruition.

Q: What is Mi Mate? How does Mi Mate compare to market competition?

Edward: Mi Mate is an organic yerba mate beverage. Yerba mate is a plant and we use it to make a tea-infused natural beverage.

We reached out to the best brands and farms to learn more about yerba mate and found that most yerba mate drinks are not authentic. Most products on the market misrepresent a tradition that is several thousand years old. We realized that we had to make a drink that would be authentically yerba mate. 

We went to Paraguay at one point. We wanted to source Mi Mate ethically in terms of environment and social stewardship. We use 2-year-aged Paraguayan mate, chamomile, mint, and lemon, just like they drink in Paraguay.

Yaniv: We are bringing authentic, culturally pure yerba mate to the table with tons of antioxidants, vitamins and minerals, amino acids, caffeine and l-theobromine. We want to relate to Latin Americans in a different way, and respect the hundreds of years of tradition behind Paraguayan yerba mate.

Q: How did you get initial traction for your company?

Edward: We spent the whole summer experimenting with different flavors using French presses to create drinks- which admittedly, in their beginning stages, tasted pretty nasty. We tried citrus fruits and ingredients from spice shops, beach shops, and herbal stores. The biggest support that we received came from the university community, and we always leverage our status as students!

We did a ton of cold emailing initially. Most CEOs have email addresses that you can figure out. We have been cold calling CEOs, COOs, and beverage professionals at all the companies that we could think of. That's how we made a lot of connections.

We got responses because we showed genuine interest and passion in what we were doing. We researched information about the people we contacted and found out what kind of things they were interested in. That's how we were able to make strong impressions.

Q: Who has influenced your company and you as an entrepreneur?

Yaniv: Two of my greatest mentors were my parents. They are immigrants who came to this country with very little and built a small roofing business, which they still manage today. They taught me to be relentless, how to hustle, and to have the grit it takes to succeed. Two of the people who most helped Mi Mate succeed are Sylvia Mah and Eric Gasser. Their encouragement, unfeigned criticism, satisfaction, and discontent drove us to continuously reevaluate our business model, driving a leaner, more unique business.

Edward: Jonathan Gold.  He really inspired us to explore food as a moment of experience and memory, a way to elicit feeling, emotion, and truth. Mi Mate is our approximation of tererè, an experience we shared with countless Paraguayans, one of intimacy and understanding.  Also, we would be nowhere without the help and support of Dr. Roger Clemens who has continually helped us develop production solutions including our patent-pending “intelligent brewing” process which allows us to maintain authenticity and cold brew while still extracting as much caffeine as three shots of espresso.

Yaniv: I remember the visit to Suja factories, having met some of their executive team at a conference earlier. The trip made me realize what it would take to grow our company to the next level using the ingredients that we chose and the vision we’d established. Seeing how a company such as Suja has retained the integrity of their product to that scale really catalyzed Yaniv and I to go back to the drawing board and remove preservatives or flavorings preservative, natural flavor from our beverage. We are no longer a shelf-stable product and our shelf life is much shorter, but our taste is 100,000x better.

Q: Describe your experience with the Entrepreneurial Challenge Competition at the Basement Accelerator.

Edward: The challenge was really cool – it was encouraging for us in a lot of ways. It was beneficial to have other organizations that were willing to partner and help students and the event brought to light a lot of the work that's been done in the Basement Accelerator. They have so much going on, a lot of attention from administrators and government officials, and grant funding. It is such a great space…an amalgamation of great ideas and a lot of motivated students.

I like that they host open events where students and entrepreneurs can interact, network and meet other entrepreneurs who are making a seminal impact in growing startups from ideas to commercial products. I think that’s really important.

Yaniv: The Basement seemed so exclusive when we explored it at first. After joining, we realized that wasn’t the case at all. The Basement is open to students that are willing to put in the time and have the passion for what they're doing. 

Joining the Basement startup incubator at UCSD and working around such motivated, capable individuals really helped us flush out our ideas and build our business. Every day we learned something from someone or bounced ideas off one other. It made the process of building our company so much easier.

Edward: The environment really teaches you a lot. Learning from others and feeding off your peers…   the tools they use, and how they approach things from different perspectives.

We benefit so much from being a part of an active UC community. I've never found a community that's more dedicated to helping others succeed. I think that's incredible

Q: What needs to happen before officially launching Mi Mate?  What are your target milestones?

Edward: We are targeting to debut our products through the Entrepreneur Challenge. We're doing a Friends and Family seed round first because I cannot go in front of a food and beverage investor without sales numbers. I am focusing on networking with investors and I want to be ready to ramp up production when we raise money from the Friends and Family seed round.

We are also looking into Kickstarter to raise money and get some pre-orders. We can use the resources to help validate our concept with consumers by having them pre-order Mi Mate. If consumers are willing to pre-order, then we really have something great to pitch to investors.

Yaniv: We are targeting to have Mi Mate in every major retailers stores in San Diego this fall. We just got back some labs confirming we have met our target caffeine and l-theanine content, which is great news!  We are now in the final stages of formulation and working through a packaging redesign before we launch in San Diego!

We are also currently working with Whole Foods. We hope that Mi Mate products will be on the shelves of major retailers in California by next January or March. We want to have a very fast expansion in California and solidify our presence here.

Q: What’s your approach to growth hacking as the company evolves?

Edward: Our mindset and the way we approach business has not changed from a year ago to the present day. We are still hustling, cold calling and emailing like crazy. We have found tremendous success and great mentors. The biggest headache is making sales.

Once we get a product on the retail shelves, our approach will change. We will need to grow our direct sales, increase distribution, minimize product costs, optimize supply chain and manage growth. That's a different kind of growth hacking and we’re preparing for the challenge. We are getting a lot of advice, mentorship, and guidance on how we should approach growth in a conscious manner.

Yaniv: Our growth hacking has gotten a little smarter and more creative over time. We had a soft launch at UCSD to show people all about our products. We approached the UCSD’s Associated Students (AS) Association and asked for a grant to throw an art and music festival with local San Diego musicians, free food and our beverages.

We also made a great connection with a local brewery that's letting us use their space practically free of charge. Working in a real factory, we’ll be able to make the first thousand bottles at a lower cost. Previously, a manufacturer offered to charge us $12,000/day to produce 4,000 bottles, but we’re not ready for that scale yet

Q: Do you have any advice for other UC entrepreneurs?

Edward: I would advise them to keep testing assumptions, i.e., find out why consumers want to buy products, how to scale production, how to form a commercialization strategy, etc.  It is important to reach out to other people in order to make ventures happen.

Yaniv: I would advise student entrepreneurs to reach out to people beyond UCSD, to people in San Diego and the greater community. Talk to professors and fellow students. Google for connections and ask professors for permissions to use their names to contact other people or to get data and mentoring. So don’t limit yourself to primarily campus resources because there is a wealth of connections out there to be made!

 

Sign up for the UC Innovation and Entrepreneurship newsletter for more interviews with UC founders as well as opportunities to be included as a UC founder.