Lemon Perfect CEO Yanni Hufnagel Has All the Luck

When Americans were hunkered down during the COVID-19 shutdown, wondering which commodity would run out next, fate doled out a supersize helping of luck to entrepreneur Yanni Hufnagel. Two weeks into the U.S. closures-just days after the launch of Lemon Perfect, the hydrating flavored lemon water brand Hufnagel founded in 2017-online retail giant Amazon stopped acquiring new brands.

"If we had been two weeks later, I don't know if I would be in this chair today," Hufnagel said during an interview on BevNET's Taste Radio podcast. "That's how fragile this business is."

Yanni Hufnagel understands luck intimately: he's been struck by it numerous times. He also creates luck through hard work, tenacity, and curiosity. The words "lucky" and "fortunate" pepper his intriguing tales of wooing retail buyers and winning over investors. 

"I have had really smart people around me," he told Joe Pompliano on Pompliano's podcast, The Joe Pomp Show. "Then again, you've got to get lucky." 

The 5-calorie, zero-sugar water enjoyed a second COVID-related bit of luck when it hit brick-and-mortar stores during the dog days of the quarantine. Americans saw empty shelves at every turn, but the lack of competition fueled Lemon Perfect's newfound popularity. 

"There was a run on water," Hufnagel remembers. "No one knew what Lemon Perfect was at the time, but we were the next option. So we were able to sell to people who were like, 'Well, let's get whatever the heck this thing is! Fine! Great! I'll take it!' People were buying pallets-there was nothing else to buy." 

A Difficult Decision by Yanni Hufnagel Pays Dividends for Lemon Perfect 

Hufnagel made a difficult decision when he chose to turn Lemon Perfect's original keep-refrigerated product into a shelf-stable formulation. The flavorful hydration aid, containing electrolytes, natural flavors, and plant-based sweeteners, is a healthy alternative to sugar-heavy sports drinks. But it would attract far more eyeballs if it could take display space on main floors as opposed to being found only in cold space, Hufnagel felt. A keep-refrigerated drink would also be harder to scale. It was a tough call-and he had to inform investors of the snag. 

"We basically stopped selling the product," he says. "We just handled the business that we had. And we had actually just gotten into the Northeast region of Whole Foods-keep refrigerated. [We had gotten] a little momentum, and then [I had] to make a big decision like this."

Hufnagel's instinct to compete as a shelf-stable formula led to success. Today, Lemon Perfect's flavors have expanded from the Original Lemon formulation to seven flavors infused with organic fruit, including Dragon Fruit Mango, Peach Raspberry, Kiwi Star Fruit, Blueberry Açaí, Strawberry Passion Fruit, and Pineapple Coconut.

Hufnagel stands by his decision to shift to a shelf-stable beverage. He believes a refrigerated formula probably wouldn't have survived the COVID-19 economy.

A Manager's Wife Gives Yanni Hufnagel a Lucky Break

Drinks like Bai, vitaminwater, and Hint have had years-in vitaminwater's case, decades-to gain their bona fides in the growing enhanced water market, making them stiff competition for Lemon Perfect. One lucky break-by way of a manager's wife-pitted newly formed Lemon Perfect against the established enhanced water brands at Publix, a Southeastern supermarket chain with locations in seven states. The break was so momentous that Hufnagel prefaces the tale by saying, "This is a crazy and true story." 

The scenario unfolded when a beverage broker repping Lemon Perfect visited Publix's upper management in hopes of getting the enhanced water onto store shelves. Jeff Smith, the Category Manager for carbonated soft drinks and water, wasn't hosting the meeting-another staffer had set it up. But Smith grabbed some Lemon Perfect samples from a nearby table for his wife to try. She loved it. One week later, Lemon Perfect was in all 1,250 Publix stores.

"You have to get very fortunate along the way," Hufnagel said on The Joe Pomp Show. "Publix has been such an incredible driver of our business. The brand is on fire in the Southeast. It has allowed us to open other doors in the Southeast and across America." 

An Investor's Wife Gives Yanni Hufnagel Another Lucky Break

When Hufnagel worked with a beverage crafter to create the original Lemon Perfect formula, he aimed for a taste people would embrace everywhere, from Baton Rouge to Beverly Hills. He also established some nonnegotiables: the drink had to be healthy, zero-sugar, low-calorie, and affordable (not more than $1.99 per bottle). From the taste to the brightly colored packaging, Lemon Perfect has checked off those boxes and many more as a compelling disrupter in the enhanced water category. 

Hufnagel's 10 years' experience coaching college basketball at iconic universities such as Harvard and Vanderbilt taught him the art of storytelling, which he used to bring the new brand to life and present Lemon Perfect to potential investors. By intriguing investors with a story, Hufnagel hit pay dirt early on-long before his company raised more than $40 million and received a $100 million-plus valuation. 

"I was lucky that we were always able to tell a great story," Hufnagel told Taste Radio's Ray Latif. 

He describes a singular lucky break he experienced in New York City, where his fate crossed paths with yet another wife-and her sought-after opinion-of an executive who changed the course of Lemon Perfect's history. This executive, a significant potential investor, met with Hufnagel. After sipping the Lemon Perfect sample, the man requested more bottles for his wife to try. 

"I ran across Central Park to get some more," Hufnagel says. "I'll never run that fast again! I had little 4-ounce bottles that I was pouring into a gallon jug. Afterward, he called me and said, 'My wife and kids love it! I'm in!'"

This big win led to a seed round of 40 investors. 

The Team's Worst Nightmare, Resolved

The Lemon Perfect Company is now headquartered in Atlanta, and Hufnagel says his team members "bleed yellow" from enthusiasm for the brand. In the early days, Hufnagel's crew experienced the stuff of nightmares at Natural Products Expo West, an annual show that's the world's largest natural and organic trade show. There, buyers scour hundreds of decked-out booths to discover innovative ready-to-drink beverages to quench their customers' thirst. Lemon Perfect's booth was lost during shipping, so the team printed retractable Lemon Perfect banners at FedEx to assemble a makeshift booth.

Yanni Hufnagel says, "You get one shot. We had put all this energy in, and our booth didn't show up. Then the buyer of the Northeast division of Whole Foods stopped by the booth and fell in love with the product."

Any so-called lucky person knows luck isn't entirely based on chance. Entrepreneurs improve their luck by being prepared, landing at the right spot at the right time, networking with movers and shakers, and attracting fans with their zeal. But luck certainly helps. And Yanni Hufnagel seems to have had much of it.