Oct 21, 2024 · 1h 6m · how-i-built-this
21 Seeds: Kat Hantas
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of 'How I Built This', host Guy Raz interviews 21 Seeds co-founder Kat Hantas about transforming her kitchen-crafted fruit tequila infusions into an all-natural spirits sensation for women, scaling through regulatory and operational hurdles to achieve a $160 million acquisition by Diageo.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Guy holds 38.8% of the talking time here. How this is scored →
Guy as informed peer 1.6 Guest teaching 1.7 Guest disagreement 0.9 Guy pushing back 0.9
speaking balance: gold is Guy, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 1:03:37 Kat reframes luck versus timing
Kat gently rejects the passive concept of luck, insisting that their success resulted from intentional timing and hustle.
Hardest push from Guy ▶ 21:48 Guy questions entering a crowded celebrity tequila marketGuy challenges Kat on whether launching in 2018 during a massive wave of celebrity brands looked like an imminent bubble or bust.
Biggest teaching moment ▶ 32:27 Kat corrects Guy regarding Oaxaca and JaliscoWhen Guy suggests Mexican tequila production takes place in Oaxaca, Kat quickly clarifies that Oaxaca produces Mezcal, while tequila originates in Jalisco.
Guy holds their own ▶ 1:02:00 Guy cites specific sales case figuresGuy demonstrates strong command of the company's financials by citing their exact independent final-year case sales versus Diageo's post-acquisition volume.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Guy as informed peer | Guest teaching | Guest disagreement | Guy pushing back | Why |
|---|---|---|---|---|---|---|
| Announcement of the New How I Built This Newsletter | 2 | 0 | 0 | 0 | Guy opens the show with an announcement and delivers an extended monologue framing Kat Hantas's story through the lens of beverage branding and positioning comparisons to Liquid Death. | |
| Early Career in Entertainment and The Boy Band Film Debacle | 1 | 1 | 1 | 1 | Guy asks Kat about her start at CAA and her transition to independent film producing, leading into her story about the ill-fated boy band film Taking Five. | |
| Medical Advice and Developing Kitchen Tequila Infusions | 2 | 4 | 1 | 1 | Kat explains switching from wine to blanco tequila per doctor advice. When Guy mistakenly suggests tequila is distilled from grain or starch, Kat corrects him by explaining the agave plant distillation process. | |
| Spotting Market White Space and Recruiting Co-Founders | 2 | 1 | 1 | 1 | Guy questions whether entering a market filled with celebrity tequilas felt like a bust waiting to happen, but Kat explains her focus was identifying an unaddressed female demographic. | |
| Industry Research, Three-Tier Regulations, and Product Philosophy | 1 | 2 | 1 | 1 | Kat discusses conducting industry research and navigating the three-tier alcohol distribution system, explaining why existing flavored spirits tasted synthetic and overly sweet. | |
| Distillery Sourcing in Jalisco and Securing Distribution Logistics | 1 | 4 | 1 | 1 | Guy mistakenly asks if the distillery was located in Oaxaca, leading Kat to correct him that mezcal is from Oaxaca while tequila is from Jalisco. Kat then explains launching via Park Street to bypass distributor sales force requirements. | |
| Branding Strategy, Agency Missteps, and BevMo Line Reviews | 2 | 2 | 1 | 1 | Kat details firing a design agency pushing masculine branding, meeting with BevMo's buyer, and preparing for line reviews on tight deadlines. | |
| Securing BevMo's Order and Overcoming Production Obstacles | 1 | 1 | 1 | 1 | Kat recalls presenting at BevMo amid buyer turnover, receiving a purchase order for all 147 stores, and encountering severe production hurdles when fruit pulp clogged distillery machinery. | |
| Digital Grassroots Marketing, Organic PR, and Retail Growth | 1 | 2 | 1 | 1 | Kat explains the legal mechanics of social media alcohol giveaways and securing organic endorsements from high-profile figures like Katie Couric and Jessica Alba. | |
| Pandemic Expansion, Southern Glazers Deal, and Diageo Exit | 3 | 1 | 1 | 1 | Guy demonstrates detailed familiarity with 21 Seeds case volumes and Diageo's brand portfolio as Kat details navigating the pandemic, securing Southern Glazer's, and negotiating a 160-million-dollar exit. | |
| Reflecting on Timing Versus Hustle and Culinary Pairings | 1 | 1 | 1 | 1 | Kat reflects on timing versus luck, and Guy jokingly pitches an ouzo-infused tequila for her to bring to Diageo innovation meetings. |
Statements from this episode (18)
Hantas: Horror films sell on high concepts rather than A-list talent
“With horror, A, it works, if, as long as it's a good concept, and B, you don't have to worry so much about the A-list actors, because anyway, you know, they all die. It's really the idea that sells it, so as, like, young, New producers. We thought it would be …”
Hantas: Unaged White Spirits Are Cleaner Than Barrel-Aged Spirits
“He just didn't want me to drink an aged spirit, because when you age it, you put it in barrels, and yes, what leaches in to the liquid is some flavor, but also those things can react with your body, so if you're trying to drink cleaner, just drink a white spir…”
Hantas: The 2018 tequila market ignored women and spritz drink occasions
“Cause at that time in the world of tequila, there were shots. So like, and then there was like sipping tequila, right? And the sipping tequila was really being marketed like scotches and whiskeys to a male consumer. And there was nobody talking about, you know…”
Hantas: Co-founders are essential because friends quickly tire of your startup complaints
“It's incredibly lonely. And your family very quickly tire of hearing about your woes and your friends. Follow pretty shortly thereafter. They don't want to hear about it. So you definitely need, you know, some people in the trenches with you.”
Hantas: Unlike wine and beer, spirits brands cannot sell directly to consumers
“Unlike wine and beer, you can't sell directly to your consumer as a hard alcohol brand, like as a spirits brand. You have to go through distributors. So your initial customer is not your ultimate customer, right?”
Hantas: Flavored spirits tend to be overly sweet and taste metallic
“Our problem with flavored spirits is that they tend to be overly sweet and Have a weird aftertaste like you're sucking on a nickel, and smell like a Jolly Rancher.”
Hantas: 21 Seeds convinced women to buy hard alcohol for home consumption
“Prior to 21 Seeds, really, women would bring wine and beer, buy that for the house, and they weren't in the business of really buying hard alcohol for the house, and we really changed that behavior.”
Hantas: 21 Seeds launched distribution through Park Street without sales support
“We launched with Park Street. Park Street is a distributor that, you know, checks the box on the three-tier system. They are the ones who are delivering the booze to the customer, writing, you know, doing all of that. They just don't have a sales force.”
Hantas: 21 Seeds co-founders invested $100,000 in 2018 for product development
“So initially, the three of us each put in the money to just, and it was I want to say, a 100,000 dollars. We put in the 100,000 dollars for the year of 2018 to just see if we could actually bring this, you know, make this product, do the development of the act…”
Hantas: 21 Seeds spent nearly half its initial $100K on a design agency
“I mean, I think we had only put in, at this point, a 100,000 dollars, so it was like almost, I would say almost half our budget was going to this.”
Hantas: Retailers hold annual spring line reviews requiring finalized products by January
“And those line reviews happen once a year in the spring, and you have to be ready with your product, everything done in like January. And if you are lucky enough to be invited to present at a line review, you have an opportunity to pitch your product. And then…”
Hantas: Spirits brands do not pay retail slotting fees, unlike non-alcoholic CPG
“In spirits, you don't have to pay slotting fees like you do in non-alcohol. So it's a little more fair in that you, if you really do have that shining product, you can get through, and it's not a matter of how much you can pay, right? With the slotting fees yo…”
Hantas: Founders must actively distribute earned media to retail buyers and distributors
“People don't, they think that it just happens and that's the end of it. You have to push all of that out to all of the people.”
Hantas: 21 Seeds Turned Profitable in 2020 Due to Reduced Travel Costs
“For 2020, we actually were profitable because it was you know, you didn't have to spend as much money on things like flying to distributors and opening a market.”
Hantas: 21 Seeds Became the Market Leader in Flavored Tequila
“We were now on the leaderboard, like suddenly this little brand, 21 seeds is now suddenly the leader in flavored tequila and it's actually growing serious share.”
Hantas: 21 Seeds Held $4M in Funding for Only 1.5 Years Before Exit
“We didn't even keep their money for very long because the four million dollars we raised, they, we only had that money for like a year and a half, you know?”
Hantas: 21 Seeds went from retail launch to Diageo acquisition in under three years
“Like, we got on shelf in April of 2019 and we closed the deal with Diageo March of 2022.”
Hantas: Making a startup seem bigger stretches capital and accelerates growth
“Making yourself, you know, in every step of the way, kind of seem bigger than you are so that you can make the money go further, you know. And that is so hugely important and I think played a huge role in why things happen so quickly for us.”