Why Koios says nootropics are the ‘next frontier’ of functional beverages – Food Dive

Chris Miller's struggles served as the motivation behind building his growing functional canned beverage business.

For most of his life, Miller told Food Dive he struggled with attention deficit hyperactivity disorder. After college, he was prescribed Adderall to help him focus, but he said he experienced trouble sleeping.He didn't want to eat,and even saw his cortisol levels shoot up as a result of the medication.

"It's pretty dangerous stuff, especially taken in high quantities over long periods of time," Miller said."...As my health started to deteriorate, I sort of hit rock bottom in terms of the way that I felt I was sick and tired of being sick and tired. And so I started working on my own to develop a formula from Earth-grown nutrients and herbs and various things that would basically mimic the effect that I was feeling or getting on Adderall."

Miller set out to find an alternative to help himself and others. He started doing research and got a basic framework together for a supplement that he wanted to launch using nootropics, which are supplements that can improve cognitive abilities. Then he worked with doctors, chemists and nutritionists to refine his formula since he didn't have that background himself. In 2014, his company, called Koios, launched a supplement. A year later, Koios put out its first beverage.

Chris Miller

Looking back, he said that beverage was a "terrible first attempt" because it didn't taste good and the packaging didn't fit with the brand.In 2017, the company decided to reformulate the beverage, which he said was the right step for the company's growth.

"We decided to very painfully take a huge step back and rebrand, reformulate and basically start from scratch," Miller said. "We wanted to push the boundaries of 'How do you make one of the most functional, organic, natural beverages that can drive human performance, but also make it taste amazing.' "

The company spent a year developing flavor profiles and delivering a better tasting product including flavors such as apricot vanilla and pear guava, while keeping more than 2,000 milligrams of active ingredients.

Prioritizing the taste and benefits of the drink helped the company find more success in the last year.Koios beverages are now sold in more than 4,300 stores nationwide, including Walmart and GNC, as well as online through Amazon. In addition to its Koios drink, this year the company addeda new functional beverage to its portfolio. Fit Soda has electrolytes, no sugar and is infused with branched-chain amino acids.

Miller expects the products' reach to grow along with brand awareness.He estimated Koios will be in 10,000 to 15,000 stores next year, making $8 million to $10 million in revenue.Since it reformulated, the company has grown substantially, jumping from $43 in product revenue at the end of fiscal year 2018 to $242,440 in 2019, according to its financial statements.

Miller predicts substantial growth for the brand because he says Koios is at the forefront of a new trend in food and beverage: brain health.

"I always tell investors it's sort of like being a part of kombucha before it was kombucha. Everybody kind of understands gut health now,"Miller said. "To me, the brain is the next frontier and it's the next driver in terms of growth in nutrition."

Functional foods and beverages have become more popular in recent years. A report from Tastewise, an Israel-based food trends prediction and intelligence startup, found 37% of consumers are using food as a functional tool to reach their health goals. And a white paper from ingredients company Kerry reported that 65% of consumers seek functional benefits from their food and drink.

"I always tell investors, it's sort of like being a part of kombucha before it was kombucha. Everybody kind of understands gut health now. To me, the brain is the next frontier and it's the next driver in terms of growth in nutrition."

Although many people are just learning about nootropics now,the market size is estimated to be worth $4.94 billion by 2025, according to Grandview Research. Koios contains a variety of nutrients and minerals including MCT oil, electrolytes, lions mane mushrooms and amino acids like L-tyrosine and L-theanine. These ingredients combined classify the beverage as a nootropic drink.

Nootropics have gained popularity in the supplement industry in recent years, withdozens of over-the-counter products claiming to help with various high-level brain functions, like memory and decision-making. There aren't as many food products with these ingredients now,and many researchers and companies are still determining their effectiveness.

Guillaume Fond, a psychiatrist with Frances Aix-Marseille University Medical School who has studiedcognitive enhancement told Time Magazineearlier this year that some of these ingredients do provide attention benefits, but data is "still lacking to definitely confirm their efficacy." Beverage brand LGNDand nootropics companyNeurohacker Collective both make energy drinks with the ingredient.

To show consumers the impact of the products,Koiospartnered with one of the top neurofeedbackcompanies in Colorado, which does cognitive training for the Denver Broncos and the Colorado Rockies. The firm started doing brain scans on people before and after Koiosconsumption and saw enhanced brain function after,according to a report. The company showcases the brain scanson its website.

The companys functional and unique ingredients make it stand out, Miller said. But they are just getting started with innovation.

Koios is working on developing a nootropic coffee drink and already developed an intial CBD-enhanced beverage line under its Fit Soda brand.

Miller said there is still a lot of gray area with CBD, so the company is holding off untilfederal regulations about CBD in food and drink are established and one of the big box retailers that they work with wants to put it on shelves. When that happens, Koios will be ready.

Koios

In August, Koios addedTravis Tharp,president and chief operating officer of Keef Brands one of the first companies to put cannabis in soda to its advisory board.Keef Brands will supplycrystallized, water-soluble CBD for Koios beverage products.

"It'll be much easier for us to scale our CBD product than most of our competitors," Miller said. "We already have the relationships once it's greenlit, we'll have a huge head start."

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Why Koios says nootropics are the 'next frontier' of functional beverages - Food Dive