Ugly Drinks duo set up business on a shoestring and is now going global

Hugh Thomas has come a long way since crafting the Ugly Drinks business in his flat with only the money from his and co-founder Joe Benn’s last paycheck as well as funding from friends and family.

The business – and it’s quirky name – was borne from the frustration of seeing big soda brands marketing their unhealthy fizzy drinks across all age ages and their desire for exposing the ‘ugly truth’ of the industry.

Both Hugh and Joe want to make people less reliant on sugar. Hugh told This is Money: ‘We wanted to launch a brand without the artificial ingredients. We wanted to make sure the marketing was true.’

Not so ugly: Hugh Thomas (left) and Joe Benn, both previously at Vita Coco, launched Ugly Drinks in Britain four years ago

He adds: ‘A lot are drinking 40grams of sugar in a carbonated soft drink. People want to avoid sugar but need a product to be affordable and accessible and fun. That’s what we set out to do.’

The competition has stiffened since the launch of the business with entrants like Dash Water and Voss but it’s not something that Hugh appears concerned about. 

In 2015, when Ugly launched in Britain, Hugh claims there were fewer globally renowned carbonated sugar free drinks on the market.

He says that Ugly Drinks became the UK’s first unsweetened 100 per cent natural, fruit infused sparkling water.

‘When we launched in the UK, Ugly was pioneering the sparkling water category, since then we’ve seen more than 15 brands follow suit and come to the market.

‘Consumers were immediately struck by our branding and packaging. Our bold colours and signature Ugly tongue truly got people’s attention.’

Ugly fans have four flavours to choose from in the UK: lemon and lime, triple berry, peach and tropical. 

The US, meanwhile, has more flavours including: watermelon, pink grapefruit, pina colada and cherry.

Hugh adds: ‘We’re proud to be taking on the established brands in the US, where people are connecting to Ugly Drinks’ British origins, bold 1980s street art-inspired look and no sugar, no calorie message’.

Multi-million investment round

While both founders established the business on a shoestring, the Ugly Drinks business has managed funding since it launched.

In mid-October, the company announced the completion of a multi-million dollar funding round from investors including Pentland Ventures and Steadman Partners (owned by Martin Dickie, the founder of Brewdog) among others.

Ugly Drinks prices 
24 Cans (single flavour Variety pack (4x six cans)  Party pack (4x 12 cans)  Office pack (8x 24 cans   
£19.99  £23.99  £39.99  £119.99   
The Ugly Drinks are available in Sainsbury’s, Tesco, Morrisons and direct. Prices correct: 11 December, 2019.
Source: uglydrinks.co.uk

Hugh refuses to disclose the exact investment sum but says it will be dedicated to expanding the business in Europe, US sales, marketing and product innovation.

He also promises to use the funding to add more flavours to the range and launch the energy drink version in the UK.  

A still version of the drink may also be considered. 

Hugh says: ‘We have lots of innovation ideas. Nothing is off the table. The brand is all about disrupting the status quo.’ 

Selling the business is not on the cards at this stage but Hugh doesn’t deny that the company is on the radar of other big drinks businesses. 

He says: ‘We are disruptive and are getting noticed. We are getting interest from investors and our long term ambition for Ugly is that people are not drinking sugar and artificial sweeteners for too long.’

Ugly Drinks has four flavours available in the UK but there are more offered in the US as well as an energy drink

Ugly Drinks has four flavours available in the UK but there are more offered in the US as well as an energy drink

An ugly name?

When asked about the attractiveness of the name ‘Ugly’ for a business, Hugh says the name was inspired by a quote that was commonly credited to journalist and novelist George Orwell. 

It reads: ‘In a time of universal deceit – telling the truth is a revolutionary act.’

Hugh says that Ugly was created to point out the ‘ugly truth’ in a world of fake news, artificial ingredients and promote social good.

To this end, the business currently supports Girl Up’s leadership development programme to fight gender inequality and donates 1 pence for every drink purchased to the cause.

We have lots of innovation ideas. Nothing is off the table. The brand is all about disrupting the status quo.

Hugh Thomas – Ugly Drinks 

They embrace the name which is also boldly emblazoned on their clothing. 

One may be forgiven for believing that it would create an open invitation to mockery but Hugh maintains his business’ clothing is sought after and that there are no issues with the name.

He explains that consumers are wearing their kit, which includes a beanie, cap and jacket, with pride: ‘We actually see the total opposite. 

‘They [consumers] wear our merchandise and are Instagramming the product.

‘They are tired with brands that overpromise and under deliver. They want brands that tell the truth. 

‘People ask where I got my Ugly cap and we’ve got our big following to our graphiti-style branding. I love the brand name, it’s easy to spell and memorise.’

The company is set to launch more branded merchandise in 2020, which will include stickers that can be stuck on things like skateboards and drink bottles.   

Ugly Drinks co-founder Hugh Thomas says that the company's merchandise such as the jacket and cap (pictured) are a hit among young customers

Ugly Drinks co-founder Hugh Thomas says that the company’s merchandise such as the jacket and cap (pictured) are a hit among young customers

Boost in sales

Hugh says the company’s target is to more than double the predicted £3million in sales for 2019 to £8million in 2020. 

Hugh says the Ugly drinks will by then be available in over 20,000 retailers globally.

He says of his achievements: ‘We are seeing greater success because we’re doing something disruptive. 

‘We have personality and people are buying into that.’

The drinks industry was not an unfamiliar venture for Hugh and Joe as both worked for Vita Coco, which specialises in selling coconut water, before they launched Ugly Drinks.

Having this experienced mattered, explains Hugh: ‘Working in a beverage start up environment had given us great grounding. 

‘The big things we learnt was the importance of team work.

‘A beverage company needs all the parts of the business to work. There needs to be harmony to have success. 

‘We were lucky to spending time in the US and Japan. We learnt different styles and took it on for Ugly and have the same global business goals.

The founders have embraced the business' graffiti-style  and promoted the benefits of its sugar free drink, which is available in the UK and the US

The founders have embraced the business’ graffiti-style  and promoted the benefits of its sugar free drink, which is available in the UK and the US

‘As the business grew and people understood the product we were able to break into the mainstream.’

Hugh acknowledges that it wasn’t always easy: ‘When you’re trying to change consumer habits it takes time and you have to educate consumers.’

But he thinks this shouldn’t dissuade others from entering the drinks industry, if that’s what they want to do. 

He says: ‘There are so many opportunities in food and beverage as there’s a macro shift towards healthier products. Entrepreneurs are the best placed people to spot the problems sooner.’

His advice to would-be entrepreneurs entering this industry is to make sure they have the ability to work with different types of people. 

He adds: ‘You also need to excite the consumer and the shopkeepers. “It’s all about the people” is a phrase I’ve stuck up on my desk as a reminder to stay grounded and remember that others helped start the business.’

How does it taste?  

This is Money was sent some samples to try and it received a mixed reception, indicating it is a bit of an acquired taste.  

The drink lacks sweetness, but that’s the point – it has been developed to wean people off the sugary fizzy drinks we’re used to. 

This is something Hugh hones on when we told him the love/hate feedback. 

‘We’re always working on the products and work on the feedback. The great thing is in the US it’s the fastest category (sparkling water) it’s taking off super well.

‘In the UK the brand is emerging. Consumers are still getting used to the fact that there is no sugar. 

‘Once you try a few cans – when you get back to normal sodas it tastes equally strange.’

Small Business Essentials

 

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.

Water from South African gold mine could contain life that’s been isolated for two BILLION years

Water from South African gold mine could contain life that’s been isolated for two BILLION years, scientists claim

  • Pockets of water are hot and salty and could be chemically similar to Mars water 
  • Researchers from Princeton presented the findings at meeting in San Fransisco  
  • Water is seven times saltier than seawater and reaches temperatures of 129F 

Trapped water found in a South African gold and uranium mine may contain life that’s been isolated for two billion years. 

The pockets of water are hot and salty without any nutrients from the surface. They could be chemically similar to water deposits on Mars.

Researchers now believe they have found living things in the old water. 

A graduate student from Princeton, who conducted the research with colleagues, told Inside Science: ‘There is a potential that [the pockets] were isolated over that long time scale. So this would be a unique opportunity to see life, essentially, evolving in a bubble.’

Trapped water, found in a South African gold and uranium mine by Princeton researchers, may contain life that’s been isolated for two billion years (pictured)

Devan Nisson made the comments while presenting the research’s preliminary findings at an American Geophysical Union meeting in San Fransisco.  

The researchers collected samples last year and this year by going down into the Harmony Gold mine and creating boreholes through rock fractures. 

When they examined the material they found under an electron microscope, they saw bacteria or microbes in the shape of rods – one of them appeared to be in the middle of dividing. 

However, Ms Nisson made clear that the shapes could be minerals and sequence DNA needs to be extracted an examined to determine whether they are living cells.  

The researchers collected samples last year and this year by going down into the Harmony Gold mine (pictured) and creating boreholes through rock fractures

The researchers collected samples last year and this year by going down into the Harmony Gold mine (pictured) and creating boreholes through rock fractures

The genetic data would also help to find whether the cells have been isolated for billions of years or whether they were introduced by miners drilling into the chamber. 

The water that Ms Nisson and her colleagues found is seven times saltier than seawater and reaches temperatures of 129F – the boundary of what life is thought to tolerate. 

They also found ions such as nitrate and sulphate, which some microbes are able to use in metabolic processes to generate energy. 

The findings give hope that life could survive on Mars and other planets.  

Johnson’s Government faces first test on foreign takeovers

Johnson’s Government faces first test on foreign takeovers as decision on Cobham’s future looms

Boris Johnson’s Government will face its first test on foreign takeovers next week when the Business Secretary makes the final decision on Cobham’s future.

A public consultation will close on Tuesday night about the commitments the defence firm’s buyer, US private equity giant Advent International, will need to make for the Government to approve the deal.

Andrea Leadsom will then be free to choose whether to clear the deal with conditions that include notifying the Ministry of Defence of plans to sell the company or any of its divisions. 

Business Secretary Andrea Leadsom will makes the final decision on Cobham next week

There is no deadline for her to announce her decision, but it could come as soon as next week.

Advent swooped on the FTSE 250-listed air-to-air refuelling specialist in July in a 165p-per-share deal.

In September, Leadsom launched a surprise intervention in the takeover, which had been waved through by Cobham shareholders, and ordered the Competition and Markets Authority to probe whether it was a threat to national security.

Retailers urge new Government to slash business rates to save the High Street

Retailers urge new Government to slash business rates to save the High Street

  • The Tory manifesto outlined plans to reduce rates burden by £320m in 2020/21
  • It proposes a discount of 50% for businesses with a rateable value below £51K
  • But this discount is set to last for a year only

Retailers pleaded with Boris Johnson to rescue the High Street by fulfilling his manifesto pledge to urgently overhaul business rates.

As relief at the Tory majority swept through financial markets, attention quickly turned to the urgent need to reduce the crippling burden of business rates which has helped drive many shops, pubs and restaurants to the wall.

Helen Dickinson, chief executive of the British Retail Consortium, said: ‘The Prime Minister must fulfil his manifesto pledge and urgently begin a fundamental review into the broken business rates system.’

The Conservative manifesto outlined plans to reduce the rates burden by £320m in 2020/21

The Conservative manifesto outlined plans to reduce the rates burden by £320million in the 2020/21 financial year, by extending a retail discount from 33 per cent to 50 per cent for businesses with a rateable value below £51,000. 

But this discount is set to last for a year only.

Johnson has promised bigger discounts for retailers with smaller premises as part of the Tory manifesto in a bid to ease the burden on struggling shopkeepers.

But Robert Hayton, head of UK business rates at real estate adviser Altus Group, said: ‘The commitment to lower the burden is an acknowledgment that the standard rate of tax, at its highest level since 1990, is a major issue for business.’

Will Dame Minouche Shafik be the first female Bank governor?

Will Shafik be the first female Bank governor? Economist emerges as leading contender for top job

  • Minouche Shafik would be the first woman to lead the central bank 
  • Egyptian-born Shafik is a former deputy governor at the Bank 

Minouche Shafik would be the first woman to lead the central bank in its 326-year history

Dame Minouche Shafik has emerged as a leading contender to take over at the Bank of England and could be named governor within days.

The 57-year-old economist would be the first woman to lead the central bank in its 326-year history, should she succeed Mark Carney in January.

Egyptian-born Shafik is a former deputy governor at the Bank and is understood to be Boris Johnson’s and Chancellor Sajid Javid’s favoured candidate.

The next governor’s appointment – postponed until after the General Election – is seen as a crucial step for the Government following the dramatic Tory victory.

The role is one of the most powerful positions in the UK with responsibility for setting interest rates, the health of the banking system and financial stability.

Other names in the frame include another former deputy governor, Sir Paul Tucker, Santander UK chairman Baroness Vadera, Financial Conduct Authority chief Andrew Bailey and deputy governors Ben Broadbent and Sir Jon Cunliffe.

Shafik was deputy governor from 2014 to 2017 before leaving and taking a job as head of the London School of Economics.

She previously had stints at the World Bank and International Monetary Fund, and served as permanent secretary to the Government’s Department for International Development.

Her family was forced to flee Egypt when she was just four to escape General Nasser’s nationalisations in the 1960s.

Shafik, who speaks English, Arabic and French, used to be married to Mohamed El-Erian, the former boss of Pimco, the world’s largest bond house.

In 2002, she married second husband Raffael Jovine, with whom she had twins, and is also stepmother to his three daughters.