The Vita Coco Company’s co-CEOs Mike Kirban and Martin Roper are splitting their titles, the company announced today, as Kirban will assume the title of Executive Chairman effective immediately. Roper will continue to serve as CEO, overseeing day-to-day operations.
Speaking to BevNET today, Kirban – also Vita Coco’s co-founder – said the shift is simply a clarification of the two leaders’ positions within the publicly traded company and that their responsibilities will remain unchanged. He noted that co-CEO dynamics are rare within public companies and the updated titles will help reduce confusion among investors and better reflect their respective duties. There are no other changes to the company’s executive team.
“I think the business is in one of the most interesting places it’s ever been,” Kirban said. “We’ve really laid the foundation … from which we can build one of the largest and most impactful beverage companies in the world. And that’s kind of the position we’re in today. I think to take it to the next level, clarifying who does what beyond just the way we do it internally, but also to the Street, was the right decision.”
Roper, the former president and CEO of Boston Beer Company from 2001 to 2018, joined Vita Coco as president in 2019 and later became co-CEO in early 2021. According to Kirban, the shared title allowed the pair to focus on their respective strengths, with Roper specializing in operations and logistics while Kirban tackled strategic growth planning, relationships with retailers and distributors, and leading Vita Coco’s sustainability initiatives as a Public Benefit Corporation.
Vita Coco began trading on the NASDAQ in October in a $172 million IPO. Kirban said that Roper’s experience running Boston Beer has helped the company to diversify its product portfolio – developing new brands such as PWR LFT while working to strengthen the core Vita Coco brand through internal innovation – and to turn around stagnant sales growth.
According to the company’s Q4 and full year 2021 earnings report, net sales rose 22% to $380 million last year, and Vita Coco brand coconut water alone was up 39%. Data firm IRI reported the coconut water line’s sales up 35.2% to $228.6 million in the 52-week period ending February 20, 2022. Vita Coco products classified as “bottled other fruit juice” were up 43.5% to $41.8 million in the same period.
“When I brought Martin in, he had 20-plus years experience working with Jim Koch doing exactly what I want to do here,” Kirban said. “Together in partnership, they took that business from a small brewer to a large diversified [alcohol] platform. And together here over the last three years, Martin and I have started to lay the foundation to do the exact same thing in the non-alc space and we just want to continue to double down on that.”
Looking ahead, Kirban said he aims to continue expanding the company’s platform and portfolio with a long term vision to “build a beverage company that is thought of in the same light as Coke or Pepsi.” Since going public, he said that maintaining an entrepreneurial culture has been important to sustaining Vita Coco’s current growth trajectory; while there are no immediate M&A announcements, he also hopes to leverage that entrepreneurial mindset to work with startup brands for potential acquisitions in the future.
“I think both Coke and Pepsi, even KDP, have made it pretty clear that they’re not focused on buying these types of innovative brands today, they’re focused on building their core – and that puts us in a very unique position,” he said. “I’ve continued to build relationships with entrepreneurs and help entrepreneurs in the space continue to grow their businesses. We see opportunities for businesses that are really starting to gain traction to bring them into our system and help them really achieve their full potential. There’s a real opportunity there and so that’s something that I’m super focused on.”
Kirban also reflected on the ongoing supply chain and inflationary pressures facing U.S. businesses. During Vita Coco’s Q4 earnings call, Roper said the company’s asset-light, “geographically diversified” supply model has given it leverage to “manage total delivery costs and to shift volume between suppliers and countries in reaction to demand or supply chain challenges.” Despite higher transit times, ingredient supply has stayed “reasonably smooth.” However, inflationary pressures have the company exploring SKU rationalization and price increases to offset higher costs.
Kirban said the company is feeling the pressures of the current business environment but is keeping its eye on maintaining stock and driving sales growth.
“Compared to a lot of other companies out there, we’ve been able to get products to shelf, and at these growth rates,” he said. “And, you know, we’re dealing with cost, inflation and everything else like everybody else out there. We still believe that it is temporary in nature, who knows exactly how long, but right now the focus is continuing to grow household penetration and consumption of coconut water in the U.S.”
Vita Coco will report its Q1 2022 earnings next week.