I don’t need to explain to you how biologically imperative it is to stay hydrated, but despite that undeniable fact…us older generations somehow managed to not only survive but thrive without our beloved “emotional support water bottles.” But these reusable water bottles are more than a creature comfort…becoming a canvas for self-expression and personal statements of style among the newest generations. Though, like other status symbols…water bottles come with trends that fluctuate, with a new coveted “it” option rising above the rest every few years. But while I’m hardly a cultural expert on trendy water bottles, I can remember the first water bottle to be perhaps equated with a lifestyle was Nalgene. Next, everyone was carrying around a CamelBak water bottles. Then, a cluster of “trendy” insulated stainless steel bottles from brands like YETI, S’well, and Hydro Flask. As we passed into the current decade, Simple Modern really took control…along with the Stanley tumbler phenomenon . And then currently, I’d probably say the must-have water bottles are either Owala or Ello Cooper. Regardless, the constantly evolving landscape makes one thing clear…water bottle trends are firmly entrenched within our culture, reflecting a society that continually seeks to define itself. But has anyone considered how (beyond water bottle brand choice) further expressions of identity have been evolving from “what adorns the outside” to “what contents are inside”? In the age of TikTok, sharing creative use occasions of your wellness concoctions can be a vehicle to translate niche health trends and a reliable virality path. And in today’s world, there are as many “powdered wellness supplements” as there are personalities, and your choices can say a lot about you. To go one step further…these (basically) aspirational mixtures have become (like water bottles) a symbol of status, representing flavor taste, lifestyle taste, and identity by association. But while the synergy between trendy water bottles and powdered hydration supplements might seem obvious, Simple Modern did something unusual when it recently launched TREVI hydration. But why are “stick pack electrolyte drinks” bringing all the boys to the yard? According to recent last 52-week retail data from Circana, dollar sales within the stick pack hydration drink mix category surpassed $1.5 billion (and grew around 20% YoY). And if you consider the various untracked sales channels like ecommerce, that total categorical market size would increase substantially…making it arguably one of the most intriguing functional beverage subcategories. But all this recent fragmented commercialization activity is possible because Liquid IV took one giant leap forward in democratizing the hydration category. In fact, without the “Liquid I.V. Effect” starting to take meaningful shape maybe 6-7 years ago, Simple Modern would not have a viable (let alone lucrative) marketplace to position TREVI hydration as a product for “everyday life.” Though, despite the strong effort by Simple Modern, I just don’t believe we will see many more popular drinkware brands jumping into powdered wellness supplements (at least in the same manner of leveraging the drinkware brand equity). But when you understand that the entire supplement industry has mostly a “sea of sameness” composition…there's a chance that differentiation (and defensibility) could be derived from having a unique delivery system (and/or bottle form factor) like Cirkul or Gatorade Gx bottles.

An almost billion-dollar supplement brand portfolio (you’ve likely never heard of before) just turned CBUM into a corporate sellout. So, let’s talk about it! And even if this deal announcement was released publicly on April 1st…I guarantee there’s nothing foolish about this M&A activity. But before I give you the legitimate “insider” deep dive insights I can guarantee won’t be found anywhere else on the internet…it would be prudent of me to start by covering key press release details from the RAW Nutrition, BUM Energy, and The Quality Group M&A news. And since the bulk of my audience is based within the United States…maybe beginning with the “buy side” would be ideal. The Quality Group was formed in December 2020 with the business combination of the sports nutrition brand ESN and nutritional products brand More Nutrition. ESN was founded in 2004…and is now the sports nutrition categorical leaders within the German market. And then More Nutrition was founded 13 years after ESN but has leveraged a strong social media presence and influencer marketing…landing the nutritional products brand within the top 3 German market categorical leaders. The Quality Group is headquartered north of Hamburg (Germany) and employs more than 1200 people…mostly due to it currently producing more than half its massive product range in house. And while 2024 full-year financial results weren’t released yet, The Quality Group reported revenue of around 680 million Euros (or about $750 million dollars) in 2023. Furthermore, the fourth largest global private equity firm, CVC Capital Partners, acquired a majority stake in The Quality Group about three years ago…valuing the business at 800 million Euros (or about $880 million dollars). So, as you can assume from that mid-2022 business valuation to the beforementioned revenue amount reported 18 months later…the two founders staying operationally active, CVC Capital Partners injection of liquidity, and experienced management team CVC brought on have grown the business substantially (and quickly). But maybe it was that last point, surrounding the desire to find a strategic growth partner and them allowing founders to stay operationally active, that ultimately led to this specific M&A transaction. So, effective immediately…RAW Nutrition’s Co-Founder and CEO, Domenic Iacovone, and six-time Classic Physique Mr. Olympia Champion and RAW Nutrition co-owner Chris Bumstead will both become co-owners of The Quality Group. Moreover, RAW Nutrition and The Quality Group will remain independent partners as they seek to build long-term value for their consumers. Founded in 2019, Raw Nutrition had moderate success initially but has exploded since Chris Bumstead came onboard as a co-owner in September 2021. Over the last few years, Raw Nutrition has been recognized as the “Brand of the Year” by both GNC and The Vitamin Shoppe. Additionally, RAW Nutrition was recognized in 2024 as not only the fastest-growing sports nutrition brand (but fastest-growing CPG company overall) by Inc. Magazine. And I alluded to this earlier, but BUM Energy, an upstart energy drink brand created by Chris Bumstead in July 2023…was also included within The Quality Group acquisition. And the final portion of my latest principles thinking content will analyze the future outlook and possible implications surrounding the various stakeholders involved...including the RAW Nutrition, BUM Energy, The Quality Group, CVC Capital Partners, and the supplement industry.

Within my last quarterly content piece on FitLife Brands, I outlined my utter shock around leadership’s inability to learn from past MusclePharm experiences and how “becoming a victim of product line extension creep” became a major underlying driver of its failure. Though, the strategic decision by FitLife Brands…pandering to a retailer request for this (or that) exclusive MusclePharm line extension, is an immaterially small mistake compared to launching MusclePharm Combat Ready ready-to-drink protein shakes. But for anyone new to these quarterly content pieces, FitLife Brands sells more than 250 SKUs across 13 supplement brands…each with a slightly different product portfolio and sales channel strategy. In total, the FitLife Brands portfolio is sold through more than 20K retail locations globally. But throughout this content, you’ll hear me categorize the FitLife Brands portfolio into three segments: Legacy FitLife Brands, Mimi’s Rock Corporation, and MusclePharm. In the fourth quarter of 2024, FitLife Brands Inc. (NASDAQ: FTLF) had revenues of $15 million…which was up 13% YoY. But though that YoY growth rate obviously looks strong, it’s important to remember that those reported results were greatly impacted by the MusclePharm acquisition that closed in October 2023. While there's strategic initiatives going on at legacy FitLife Brands and Mimi's Rock, the most intriguing segment within FitLife Brands is also currently its smallest...MusclePharm. In the fourth quarter of 2024, MusclePharm segment revenue was $2.8 million. And while the full-year 2024 sales channel mix of MusclePharm was evenly split between wholesale and online revenue…the fourth quarter started to signal that the brand’s biggest long-term commercial opportunities will come from offline retailers. I was quite confident that FitLife Brands understood it’s a marathon (and not a sprint) with MusclePharm. Moreover, the last 5-7 years of MusclePharm brand mismanagement had provided a sizable amount of unlocked value that was just waiting to come out. Furthermore, doing the required “hard work” upfront to rebuild the foundation of MusclePharm for the long haul would inherently unlock enough short-term financial results to appease shareholders around the acquisition ROI. Yet…that’s not happening right now! Instead, FitLife Brands has surprised me (and not in a good way), believing it would be better served in reaching arbitrary segment-level financial goals by deciding to chase various mirages. FitLife Brands has meaningfully begun almost zero of the “hard work” required in rebuilding connection and trust with customers, reconstructing the brand story, rebuilding community, and bringing it all to life with layers of compelling content. And because FitLife Brands decided sprint through the MusclePharm turnaround plan…instead of being strategically conservative to rebuild the foundation for future growth opportunities at MusclePharm, it will undoubtedly expose its weaknesses even more prominently (and create unnecessary burden) across the entire organization.

A famous comedian once said, “God has a sense of humor. If you don't believe me, tomorrow go to Walmart and just look at people.” And if you think that’s harsh…you’ve probably never been lucky enough to experience the hilarious blog “People of Walmart.” But what if I told you that grim picture of the Walmart customer base isn’t exactly true any longer? Yes, U.S. households making less than $50,000 annually still account for the largest share of Walmart’s average monthly active users. But according to a recent Brick Meets Click report…Walmart’s most affluent segment (households making more than $200k annually) has now expanded to 8% of the total. Walmart has been prioritizing affluent households during this “flight to value” economic period because they spend on average 1.5x more monthly on groceries compared to households in the lowest income bracket.

If you’re a daily coffee drinker, it’s difficult to overlook that the price of your preferred source of caffeine keeps grinding higher. In fact, the global price of arabica coffee has more than doubled over the past year...with a sharp upward price movement (since the start of 2025) pushing commodity prices of the cash crop to an all-time high price of more than four dollars a pound last month. So, what’s going on? While the famous cartoon character Yogi Bear would say that I’m “smarter than the average bear” when it comes to coffee futures contracts…I’d hardly consider myself as locked into the ground level details of this commodity (compared to global dairy markets). But from my understanding…this is largely a supply issue stemming from changing weather patterns that have disrupted agricultural production around the world. And this reminds me of something I started getting louder about in 2021…that most CPG companies are largely unready to handle the ingredient shortages, input cost inflation, and supply issues caused by climate change over the next decade. But that’s a good transition into the other economic variable…are all-time high commodity prices impacting U.S. consumer demand for coffee? According to the February CPI report, data showed that prices consumers paid for coffee (in all its forms) were higher 6% YoY…but was up more than 1.5% from last month. So, with higher coffee input prices not fully impacting consumer price…and coffee trade organizations reporting U.S. adult coffee consumption recently reached its highest level in more than 20 years, U.S. coffee demand has not been materially impacted YET. But from what I can see by perusing the recent earnings call transcripts of major CPG companies that own large coffee brands…retail coffee prices will continue rising aggressively into the second half of 2025. Obviously, the largest companies (meeting demand across channel, preparation, and/or format) are well-positioned and possess the strategic optionality to successfully hedge against these fluctuating business risks…but I wanted to shift this next portion of the content closer within the wheelhouse of my deep domain expertise. While I believe plain ole great tasting coffee preparations will remain a consumption evergreen for many decades to come (and likely still below its “peak consumption” point), I also think there’s an emerging arbitrage…as consumers move closer towards this four-way intersection of taste, convenience, nutrition, and functionality. Moreover, every multibillion-dollar functional CPG category (such as coffee) is in the early innings of a remarkable transformation…with consumer behavior starting to evolve towards seeking multifunctional benefits that contribute to overall wellbeing. And that’s because consumers don’t want different habits…they want more beneficial ones. But the bulk of my latest first principles thinking content will explore how coffee price inflation could have major implications to the “energy everything” movement now (and into the future). This will include examining various winning sequence of dimensions shaping the future of coffee like packing more functionality into coffee, overcoming the biggest flaws of caffeine, coffee beverages becoming status symbols or basically aspirational mixtures, representing flavor taste, lifestyle taste, and identity by association, and how various food technology innovations like precision fermentation and cellular agriculture present hopeful aid to commodity inflation.

Which of these numbers is larger…the total contract value recently given to Juan Soto by the New York Mets or the total aggregate net income generated by CELSIUS energy drinks since launching 20 years ago? And if you thought that was a dig on Celsius Holdings (think again)! Instead, those remarks were pointed straight towards the sheer ridiculousness of today’s Major League Baseball contracts. But regardless…I have to take my cap off to the CELSIUS marketing team for the perfect timing around leveraging a highly anticipated ephemeral moment within professional sports. This brand ambassador announcement easily jumps to one of the most creative I’ve ever seen within the energy drinks market.

What does a term initially used 170 years ago in one of the most influential and compelling books in American literature have to do with the cognitive health category? And what was the term that Henry David Thoreau used his 1854 non-fiction book Walden to criticize society’s tendency to devalue complex ideas in favor of simple ones…seeing this as indicative of a general decline in mental and intellectual effort? Brain Rot. But that term has taken on new significance in the digital age, especially over the past year or two. Brain rot is a term used to describe the phenomenon involving a constant consumption of short, fast-paced content that can overwhelm the brain, leading to decreased attention spans, mental exhaustion, and a reduced ability to engage with deeper, more meaningful activities. Initially gaining traction on TikTok among Gen Z and Gen Alpha communities, brain rot became so widespread that Oxford University Press even named it the 2024 word of the year. But what if I told you that the term “brain rot” gaining mainstream prominence could prove extremely important in further expanding and evolving the cognitive health category? I believe brain rot moving into the mainstream lexicon could have the power to democratize the cognitive health category. And that’s because “brain rot” doesn’t age discriminate, or for that matter…discriminate based on ethnicity, gender, or any other characteristic. In fact, very rarely is anyone completely protected today against experiencing mental fatigue from social media information overload. Now in stating that…purchasing behavior doesn’t necessarily change materially just because a societal problem has been catapulted into the minds of more consumers. And there’s pros and cons to when a functional CPG category is democratized. But something that usually helps push that consumer awareness down funnel through consideration and into purchasing activity is having that category creating brand that unlocks massive commercial success by meeting consumers where they’re at with the ideal product development variables…eventually triggering competition that further evolves the market. And while there’s a multitude of competitors currently within the cognitive health category…it hasn’t seen a Liquid I.V. or Vital Proteins type breakout brand that creates the category by pushing democratized consumer awareness down funnel unlocking massive commercial success. But in stating that…I also acknowledge this business phenomenon could occur in the near-term future from a strengthening sub-segment of the cognitive health category. And then finally, instead of providing you with a typical collection of “retail sales data trends” to validate what you already intuitively assume, that peak performers are more frequently seeking out “fast-acting cognitive-boosting” functional CPG products in convenient formats to improve their daily life, I wanted to end this content a bit differently by adding value through an anecdote surrounding my recent personal journey to minimize “brain rot.”

Did you know that about one in five U.S. children are obese…a number that’s nearly four times the rate in the 1970s? So, what has changed in the last 50 years? The finger is usually pointed towards the proliferation of ultra-processed and/or hyperpalatable foods. Seeking to solve this growing problem…the FDA has been exploring a front-of-package nutrition labeling strategy that lists Saturated Fat, Sodium, and Sugar on every package with each nutrient being accompanied by a traffic light color system score box. But while these blatant warnings have never been required for food products sold in the United States, CPG brands selling into Mexico (and soon Canada) comply with different FOP nutrition labeling obligations. And I’d typically say a mandatory system would never happen…but RFK Jr. promising to "make America healthy again" by cleaning up the U.S. food system has me second guessing myself.

Can you name the health and wellness retailer that generates between four to five times more revenue selling categorical products online than the combined efforts of GNC and The Vitamin Shoppe? And here’s a hint for you…it’s not Amazon! Since the bulk of my audience is located within the United States, I’m going to assume that iHerb probably wasn’t the first health and wellness online retailer that popped into your head. So, despite its massive multibillion-dollar success…iHerb isn’t widely known in the U.S. market, mostly because the vast majority of its commercial activity happens internationally. But before blooming into a global powerhouse, iHerb began almost three decades ago as a Yahoo store selling St. John's Wort supplements online. And after the founder forgot to disable the international orders feature when the website launched, iHerb started getting orders from countries like South Korea. But rather than turning off the feature, iHerb decided to start fulfilling them. As sales started to grow, iHerb opened its first fulfillment center in 2002…marking the beginning of a strategic expansion that will soon include nine state-of-the-art logistics operations across the United States, Asia, and the Middle East. And because of its relentless focus on revolutionizing logistics solutions, iHerb can serve the health and wellness needs of customers located in 180 countries…maintaining an average global shipping time of less than five days and offering free shipping in 80 countries. Moreover, iHerb strives to create a localized shopping experience by translating its shopping platform into 22 languages and accepting more than 80 different currencies. Furthermore, iHerb has expanded its online marketplaces presence…reaching more consumers worldwide through 25 digital stores on platforms like Amazon, Tmall, Rakuten, and Coupang. But after a 22-year long journey, from selling a single supplement product to becoming a global leader in the health and wellness industry…iHerb surpassed $1 billion in annual sales. And while that was an enormous accomplishment, it only took iHerb six more years to reach $2 billion in annual sales. In fact, iHerb exceeded $2.4 billion in net sales last year…reflecting a YoY growth of 14.5%. And then for the final portion of my latest first principles thinking content, I'll briefly share my professional experience with iHerb, but more importantly provide a helpful geographical expansion strategic framework (that includes how to best leverage iHerb) for all my brand operators within the intersecting CPG categories of functional foods, functional beverages, and nutritional supplements.

Life can be A LOT like driving on an interstate highway. It’s important to stay in your lane, only glance backwards if you’re planning to make a change…and always watch out for David Beckham because he might swerve bend that corner woah! So, when it was officially announced in September 2021 that Prenetics (NASDAQ: PRE), a diagnostic and genetic testing company based in Hong Kong, was going public through a SPAC merger…I fully admit not even spending one iota of energy on the financial news headline. But I initially crossed paths with Prenetics last March when the company reached out to me regarding an upcoming strategic realignment that would focus on the U.S. consumer health market. And while I didn’t sign an NDA…I’ll keep the full extent of what I wrongfully assumed would be brief friendly surface-level introduction conversation confidential. Though, two major focuses of my strategic commentary did turn into public knowledge…David Beckham becoming a strategic investor of Prenetics (and co-founding a supplement brand called IM8 Health) and the acquisition of Europa Sports Partners. So, with more cash on the balance sheet (from selling a share of its Insighta joint venture to Tencent) and leadership recently confirming that going forward Prenetics would concentrate fully on the consumer health businesses it wholly owns and are scaling aggressively…my latest first principles thinking content will equally focus in-depth on the Europa Sports Partners and IM8 Health deal activity.