Thank you so much for joining us in this interview series. Before we dive into our discussion about disruption, our readers would love to “get to know you” a bit better. Can you share with us the backstory about what brought you to your specific career path?
My career started in Fortune 500 companies, initially in institutional and specialty sales and then on to brand marketing in headquarters. By 25, I felt like an entrepreneur trapped in a big company. It fueled my desire to break free from a large corporation. Shortly after, I joined my first early-stage company in 2001 and since have run several tech and consumer packaged goods companies that have spanned from privately held, VC backed, family-owned, from the stages of pre-revenue to some that were on a $100M run rate. Unknowingly at the time, this helped carve into FloWater—which is somewhat of a mash up between consumer goods and technology. In our case, the mantra is to UN-package consumer goods; Un-pack bottled water. In other words, our mission was rooted in the belief that everyone deserves access to clean, great-tasting, trusted water—but without any of the packaging. Now 11 years later, FloWater is on track to save one billion single-use plastic water bottles from the environment by disrupting the status quo in the water industry.
What do you think makes your company stand out? Can you share a story?
Two characteristics really stand out to me with FloWater. First, consumers are obsessed with our product. It radically—and I mean radically—changes consumer behavior. Companies, gyms, hotels, schools, warehouses all see similar outcomes when they have FloWater Refill Stations: a dramatic (100-500%) increase in daily hydration, and a massive reduction in single use plastics—especially carbonated, caffeinated, sugary drinks that are horrible for human health and wellness. This transformative impact is evidenced by the fact that over 90% of customers who undergo a free trial or demo of the FloWater Refill Station convert into customers that sign up for five-year contracts (and the vast majority renew after five years).
Second, and this is an absolute truism for any company that’s successful, it’s all about the team. There are over 50 teammates I have here at FloWater in North America (and then many more globally with Bluewater) who are absolutely incredible. They are mission-minded, passionate individuals who are committed to solving big problems and are determined to do their part to solve the single use plastics crisis, while delivering the world’s best-tasting, most-trusted water everywhere consumers work, rest, and play. Behind any good company is a great team—and we have an incredible one.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
I wouldn’t ever describe myself as a successful business leader. I aspire to be that, for sure, and I have had moments of success. I’ve also had a fair share of failure and mistakes along the way. I see this as an ongoing process and that “success” may be elusive and something I chase for the rest of my years, which I believe is part of the journey to be great at something. Which is, that to be great and your absolute best self, well, you can never fully arrive. It’s a tough balance, because in the pursuit of greatness you don’t want to be discontent or ungrateful along the way—so there’s a balance that I’m constantly trying to figure out.
Here are three characteristics I find important towards this pursuit:
- Perseverance: This trait is foundational to success. Everyone in any role in life, especially in leadership roles, will experience numerous roadblocks. It is essential to remain unyielding to temptations to slow down, or even quit, and continue to push forward.
- Coachability and learning: being open to feedback, engaging in honest self-assessment, and fostering candid conversations within the team contribute to continuous learning and improvement. Not only individually, but for all elements of the business—reiteration and pivoting to new methods, tactics, or even radically modifying broad strategies—are critical cycles to work through quickly. You can’t do that well unless you’re coachable and constantly learning with curiosity.
- Individual accountability, and more specifically being a force of nature. A force of nature is someone who creates and drives the change—and makes it happen. They’re not facilitating, they’re not pontificating, they’re not administrating…they are creators who use force-of-nature tenacity to make stuff happen. This isn’t to suggest they aren’t also great teammates. Of course, they need to be able to catalyze and gel with the team, and elevate the organizational and team dynamics. But it does mean, individually, there’s a deep and innate drive, a quest, to achieve greatness and to make things happen with a spirit that is almost as if it all depends on them (and, in some instances and especially with earlier stage companies, it does).
Leadership often entails making difficult decisions or hard choices between two apparently good paths. Can you share a story with us about a hard decision or choice you had to make as a leader? I’m curious to understand how these challenges have shaped your leadership.
Some people say that CEO stands for Customers, Employees, and Owners—and it’s a pretty accurate description of the three key stakeholders one must constantly consider when running a company.
There are always challenging decisions as a leader; there’s no yielding this part of the job. For us, and me specifically, the Covid-era brought some extra incredibly complicated obstacles, and I was faced with a myriad of tough decisions. One example, out of many, was early in March ’20 I was faced with the necessity to need to lay off a considerable portion of the company. This was a painful process, especially considering many were recently hired.
These experiences reshaped my leadership, highlighting that there will be times where the alignment you often seek among customers, employees, and owners is not always achievable. When that happens, as a CEO your job is to take all the inputs and then step up, make tough decisions, navigate the conflicts as best you can, and use your best judgment to call it like you see it. Then, go run the play as if your life depends on it (and, maybe it does), with as much alignment as you can pull in, to get to the other side.
Ok, thank you for that. Let’s now jump to the primary focus of our interview. Let’s begin with a basic definition so that all of us are on the same page. In the context of a business, what exactly is “Disruption”?
Disruption, in a business context, is basically trying to radically redefine a category to significantly change consumer behavior. Our disruption comes through solving the number one issue that has led to the single-use plastic water bottle debacle—which is that consumers don’t like, or don’t trust, tap water.
Through challenging the norm and introducing innovative solutions that consumers and companies love, we are on a mission to transform the water industry and make clean, great-tasting water accessible to all, disrupting the status quo and leading a future where trusted drinking water is available to everyone.
How do you perceive the role of ‘disruption’ within your industry, and how have you personally embraced it? Is it a necessity, a strategy, or something else entirely in your view?
If we look at disrupting the status quo, let’s look at something as simple as five-gallon jug water stations.
There are six million of these five-gallon jug stations in the U.S. alone, and it comprises about 25% of the water hardware market domestically.
At the beginning of civilization, much of our water “distribution” was going to the well, filling up a bucket, bringing it back to the community. Five gallon jugs basically are doing the same thing—and while it’s now easier for us, in many cases, it’s worse. Some of these big bottled water companies are taking these jugs (buckets), filling them with tap water wrapped in plastic, while driving all over the U.S. spewing CO2 and other byproduct, to bring water to today’s modern day “village.”
This is the opposite of innovation; in many ways, it’s regression backwards.
For drinking water, in nearly every instance in the United States, the problem isn’t “If I could only find a faucet then I wouldn’t need to drink bottled water.”
The root of the problem is that American’s don’t like, or don’t trust, what’s coming out of the faucet. And conventional hardware companies that sell water fountains, water coolers, or five gallon jugs haven’t solved the taste or trust issue—which is why bottled water has continued to grow over the last decade.
The only way that we’re going to fix this problem is through some type of categorical change, a kind of a head-on collision with the way people have done things in the past. We need to get consumers to fall in love with tap water again (and, to drink more water in general—over 70% of Americans are chronically dehydrated). And to do this, we need tap water to both be trusted and taste great.
That’s our catalyst to transform a category, and we’re doing that by reinventing it by the technology and hardware we’ve created and refined over a decade that causes people to fall in love with FloWater—which can be easily connected to any incoming water line.
What lessons have you learned from challenging conventional wisdom, and how have those lessons shaped your leadership style?
From a leadership perspective and a personal perspective, I believe every single person in this world has a purpose in their life and that purpose in is not just some quippy Instagram-like reel of “you can do anything you would ever want to do and just pursue what you love.” It’s more deeply rooted than that, and yes I believe a person’s meaningful purpose in life can also be something they love. Yet, sometimes, the things you may love may be relegated to hobbies or special interests—and aren’t necessarily your calling. I’m a big fan of figuring out your calling in life, the reason you’re here on this planet for a very short period of time. Each of us have a unique purpose and mission in life, that only each of us can individually achieve. Part of the magic of life is figuring out what that is.
Distinct from that, from a business perspective, one of the biggest challenges of the water marketplace is that everywhere and everyone is a customer. Because every single person consumes water. And the purpose of our company is rooted in the fundamental belief that every consumer deserves access to clean drinking water that they can trust. And we also have a responsibility to do this in a way that is not only amazing for the consumer, but doesn’t trash the environment with single use plastic water bottles. So related to the market and our strategy, along with the temptation that everyone could be a customer, we really have to fight to stay focused on the execution of initiatives that support our key objectives in a focused way that all align with our business purpose.
Disruptive ideas often meet resistance. Could you describe a time when you faced significant pushback for a disruptive idea? How did you navigate the opposition, and what advice would you give to others in a similar situation?
For FloWater, the greatest amount of resistance was early on. I think that’s because as humans we’re generally naturally programmed to resist what is new. The way that we were successful in the early years is we found the people that were early adopters, a much smaller section than the mass market.
Today, when we get in front of a 100 different hotel owners or GMs, the vast majority would at least be interested in what we’re doing—if not leaning forward. In the early days, it was a few out of 100.
We still have a big thing to solve for but the conversations have gotten easier because there are now two big market force tailwinds. 1. People are becoming aware that we can no longer trust our tap water, and instead we must do something to “treat it twice” by having some type of filtration or purification system where the water is being dispensed, and; 2. People are also seeing Big Bottled Water companies like they did with tobacco companies in the ‘90s. They are seeing firsthand the wasteland of contamination left behind as a result of billions of bottles of single-use plastics which never biodegrade—and not only enter our environment in the form of micro and nanoplastics, but are now lining our stomachs, skin, and even crossing the blood-brain barrier.
Today we’re having radically different conversations as a result of getting a stake in the ground, developing acclaim and being known for the world’s best tasting, most trusted water.
My advice is for any early stage disrupter to expect the resistance. And you have to be willing to hear and understand how to solve for it. It’s vital to understand the opposing view. If you dismiss the opinions and predispositions, then you’re going to miss out on how to solve the consumer sentiment and bring them into the journey of doing something new in a different way. Yet, you have to be careful not to let the contrarians seep into your DNA where they may distract you, or worse, make you so dejected that you don’t pursue your ambition.
The second piece is finding the enthusiasts. It’s easier today with the tools that are available to us digitally. You can find a Facebook group for any interest or people on Instagram using tags. Find those who are already leaning forward; don’t chase the people who are leaning back. For example, when raising funds from venture capitalists or private equity firms, one of the most dangerous things you face is a very slow “maybe.” Time is so precious, and it requires rapid cycles and fast iterations—slow maybes burn your valuable time. Same with customers, so what we really want are either a fast yes or no. I avoid the slow maybes whenever possible, or when I fear it’s headed in a slow direction, there are times where I will try to force function to a binary outcome. Even if that’s getting to no. At least, then, you know—and you burn too much valuable time, money, and energy marketing and trying to sell to the wrong people.
What are your “Five Innovative Approaches We Are Using To Disrupt Our Industry”?
- Have an insanely great product: We keep our premium product fresh with constant innovation and a dedication to giving our customers an outstanding experience. The FloWater Refill Stations, now in their fifth generation, exemplify the importance of an amazing product that customers love.
- Build a brand in a world of commodities: I have talked to thousands of customer buyers over the last nearly 11 years. And when I ask them, “what kind of water station do you have?” I’ve never had one person tell me the name of the brand that they buy. They describe it as “a big black box water cooler” or they say, “it’s a stainless steel water fountain.” We’ve branded our FloWater Refill Stations so people can recognize taste and trust and associate it with our product.
- Changing Behavior and Measuring Outcomes: feature, advantage, and benefit selling is dead (or at least it’s dying). Consumers care about outcomes, and businesses care about the same—or often they’ll define it as ROI. So, this is what we’ve focused on defining. After we deploy a FloWater unit into a location, we often see a tangible 50% drop in the consumption of energy drinks, soda and coffee – a clear and measurable shift in behavior across diverse settings like schools, gyms, workplaces and hotels. By putting the spotlight on results-driven changes in behavior, we prioritize real results and customer impact as proof of the effectiveness of our solutions. Our ongoing commitment involves in-depth research to uncover data that highlights substantial impacts, reinforcing our dedication to evidence-backed improvements in health and overall well-being.
- Passionate Hiring: Rooted in three core principles, our hiring approach values chemistry, it’s important for the individuals we hire to be able to collaborate effectively and form cohesive teams. Additionally, we consistently look for competence, always seeking individuals within the top 20th percentile. The third aspect revolves around individuals who share a profound passion for our mission and cause. We are particularly interested in those who aspire to be superstars in life, reflecting our commitment to building a dynamic and purpose-driven team.
- Execution Excellence: Recognizing that 80% of success lies in effective implementation. Our focus extends beyond the R&D stage as we actively tackle challenges. This commitment aligns with our hyper-focused approach to delivering a great product while constantly working to earn our place at the table among billion-dollar and major beverage companies. We are in an ongoing fight to build something truly great that positively shifts consumers and the environment.
Looking back at your career, in what ways has being disruptive defined or redefined your path? What surprises have you encountered along the way?
Embracing disruption has shaped my journey, pushing me to question the norm and tackle big issues. Surprises have come in the form of both resistance and unexpected support. Navigating these twists and turns has reinforced the value of sticking with it, being adaptable, and staying true to the mission.
Beyond professional accomplishments, how has embracing disruption affected you on a personal level?
Personally, embracing disruption has convinced me of the importance of chasing one’s purpose and aligning personal and professional strategies with a broader mission. It has led to a mindset of continuous learning, adaptability, and a dedication to creating positive change.
In your role as a C-suite leader, driving innovation and embracing disruption, what thoughts or concerns keep you awake at night? How do these reflections guide your decisions and leadership?
As CEO, my constant aim is to align customers, owners, and employees and to work my hardest at generating great outcomes for each stakeholder. It’s not successful if all three don’t win. Beginning with a customer-focused mindset, the strategy centers on cultivating fanatical customers to then achieve success with owners and employees. This commitment underscores the simple truth: without customers who are hardcore fans, there would be nothing else to solve for.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
With recognition that there are some amazing dads out there who have made generational impacts in their families, we also have a dad-crisis in the United States. 18.3 million kids live without a father in their homes. My movement would urge dads to prioritize their children as their central life mission, and to make the commitments needed to generate a positive impact. The focus would be on inspiring fathers to be more involved, as their active presence can profoundly benefit families and society.
How can our readers further follow your work online?
https://www.linkedin.com/in/richrazgaitis/
https://www.instagram.com/richrazgaitis/
https://www.instagram.com/drinkflowater/
Thank you for the time you spent sharing these fantastic insights. We wish you only continued success in your great work!