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In this “Next Round” episode, host Zach Geballe sits down with Ali Schmidt, one of the co-founders of Zuzu Drinks. Schmidt and her co-founder Greta Caruso came together to develop and launch Zuzu as a new line of quality RTD cocktails. Unlike hard seltzer, Zuzu’s products are made with an agave spirit and the “wholest” ingredients possible. Here, Schmidt discusses what the flavor testing process looked like, and why she and Caruso ultimately chose to use an agave spirit.

Both co-founders come from culinary backgrounds and believe in the idea that “less is more delicious” when it comes to working with high-quality ingredients. Schmidt is a self-described “passion fruit super freak” and emphasizes that incorporating real passion fruit juice was one of the most difficult parts of this process — but she and Caruso refused to cut corners. When others suggested adding preservatives, these co-founders stayed true to their brand, and eventually released the Zuzu we know today.

Read on to learn what Schmidt says makes these drinks “hangover proof,” and what differences really exist between an “agave spirit” and tequila.

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Zach: From Seattle, Washington, I’m Zach Geballe and this is a “VinePair Podcast” Next Round conversation. We’re bringing you these conversations in between our regular podcast episodes in order to focus on a range of issues and stories in the drinks world. So today I’m speaking with Ali Schmidt. She’s a co-founder of Zuzu, which is a new line of ready-to-drink sparkling cocktails. Ali, thanks so much for your time.

Ali: Thank you so much for having me. Happy to be here.

Z: Yeah, my pleasure. And I’ll be honest at the get go, I have not yet tried Zuzu. You guys are based in New York, from what I understand. And that out here in the hinterlands in Seattle, not quite on your distribution route, but I will say that the VinePair Slack has been hot and heavy with some people expressing their love for the drinks. So that’s part of how this all came to be. And so, yeah, that is not me just blowing smoke.

A: That’s great, love to hear it.

Z: So let’s start briefly with an understanding of what Zuzu is and maybe a little bit, too, in there, how it came to be.

A: Yeah, of course. So the long and short of it is that Zuzu, like you’re saying, is a sparkling cocktail. It’s a light cocktail, five percent alcohol by volume, and it’s made with 100 percent agave spirit, some fresh citrus juice, and some sparkling water. So it’s really simple and of the philosophy that less is more delicious with really high quality ingredients. And Greta and I started this company about a year and a half ago now. So quite a while ago. And as I said, I’m so happy to hear that you like the flavors and that your team likes it, because we probably went through like 40 iterations of both flavors because we’re so obsessed with taste and quality that it’s like it’s so thrilling to hear that. So I think that’s part of why it took us so long to get this thing out onto shelves.

Z: So let’s maybe get into that a little bit about how you came to the formulation or the recipes. So one of the things I think that’s interesting to me about these is that we’ve seen a lot of things in the RTD cocktail space that are, “here’s a canned x or here’s a bottle of y,” or a drink I think people are familiar with. And I’m sure there’s a cocktail nerd out there who can tell me exactly what this cocktail is. I mean, I’m a former bartender, so I’m reasonably familiar, but it feels like you’re looking at like we wanted to make something that was like a sparkling Margarita, but not really. And like, was there a drink in your and Greta’s eye you were trying to create, or recreate? Or was this like we think these flavors work, but we’re going to make something new?

A: Well, we started this whole thing by just making this drink for ourselves. So Greta and I’ve known each other for the better part of 20 years and we were actually both in the food world before we started Zuzu. She worked in California with Alice Waters at the Edible Schoolyard. I went to cooking school in Ireland, of all places, and worked as a chef for two years in London. So food and really good food has always been super important to us. And so when we started creating Zuzu, we at first thought it was going to be some sort of a food object. We just knew we wanted to start a company together. And I mean, we looked at the breakfast space. We looked at healthy candy, as if that’s even a thing. And, I think at our darkest hour, we were looking in the cracker market and we were trying to make Cheez-Its in Greta’s kitchen out of sweet potatoes and nutritional yeast, which I can say those were definitely our darkest days. And so in those, most harrowing trials of crackers, we started making ourselves what eventually became Zuzu. And for us, the flavor profile was always driven by what was seasonal. So of course, limes are never seasonal in New York, but everything has a little bit of a touch of citrus to it, which I think is a real signature of the Zuzu flavor profile. Always a little bit tart rather than super sweet, because as you were saying before, I think the problem with Margaritas is everyone’s had that sugary, deathly hangover the next day. And we would experiment with fun things, whether it was plums or whether it was persimmons or different kinds of grapefruit. So that’s really how we started thinking about our flavors. So we would just make it for ourselves, basically. And one day we’re like, this is amazing. And we want to be drinking this every day and we need to turn it into a product. And the question was like, how do you go about doing that? And that was all very new to us and exciting. And we started working with someone who was a former chef and formulator here in New York. And we were like, okay, let’s go wide. Let’s figure out what are the best flavors. We know we want something with a lime profile. We are both super freaks for passion fruit. I don’t know if you feel this way about passion fruit, but either you’re a passion fruit freak or you’re not. And we fell in that realm, and those were just the two that came out as the most delicious. I think because we come from a background in food, we only ever want to put out flavors that are what we consider to be very well-balanced and perfect.

Z: And so maybe a little more about that process of searching for and sourcing the ingredients, because I think something that is clear in the way that you guys have positioned Zuzu and just some of the press materials and whatnot, there’s a lot of talk about transparency and sourcing, and so obviously, you know, those things don’t appear in a press release for no reason. They’re obviously important to you and Greta. So can you talk a little bit about how both philosophically what that means, and also practically what you did?

A: Of course. So transparency to us is pretty simple. It goes back to this quality that less is more delicious. When we started sourcing our passion fruit, for example, you would be amazed. It’s like the juices that we were finding were either bulked out with other kinds of juices. So it wasn’t just passion fruit. It was like they would sneak in some apple juice and some pear juice in there to bulk it out or it had cane sugar in there to act as a preservative. So everything we did in our sourcing was to make sure that if we were going to use passion fruit, it was just the stuff, itself. It wasn’t anything else. And that means we had to use a passion fruit pureé, which separates in our drink. But we think it’s worth it because it is the real true thing. Of course, it means that our raw ingredient is frozen, which logistically is more complicated and is more expensive. But those are exactly the kinds of corners that we’re unwilling to cut, because at the end of the day, you try our passion fruit product, and it actually tastes like passion fruit, not just like a weird derivative of the thing itself, because it is the real stuff. So I think it’s a commitment to always be sourcing the “wholest” versions of whatever ingredients we’re using.

Z: So speaking about ingredients and transparency, one thing that’s interesting to me about Zuzu is that you guys are using agave spirit as the alcohol in the cocktails. And for a lot of our listeners, I think the distinction between agave spirit and tequila might be not something they’re familiar with. My understanding is we’re talking about something that’s much more of a technical and legalistic distinction, as opposed to a flavor distinction that would be noticeable to the drinker. So can you explain what the difference there is?

A: Yeah, that’s exactly right. The taste will be pretty much the same. All that we’re doing with a 100 percent agave spirit is distilling it in the U.S. So we’re buying our plants from Mexico. Our distiller that we work with here in the U.S. has a direct relationship with a multigenerational organic family farm 20 minutes outside of Jalisco. And because we’re distilling it in the U.S. rather than in Mexico, in the five regions where tequila has its denomination, we cannot call it tequila. We can just call it an agave spirit. And that’s what we’re doing.

Z: Yeah. Gotcha. And so I would wonder — “sourcing” tequila — we’ve talked about this on the podcast in a variety of different ways. And it’s a very complicated issue that I don’t really intend to get into in any great depth here. But is it more about just being able to make sure that you have a clear source, I suppose that you know and understand?

A: Yeah, that’s exactly right. I think the important thing to note is we’re so small right now that we have very little buying power. And so what feels good to us is to be able to have a super pure product and know that our dollars are being spent directly at this one farm in Mexico. I think we’re super interested in expanding and looking into other sources for tequila as we grow and gain some more buying power. The other thing is that tequila needs to be one hundred percent pure. Tequila needs to be bottled in Mexico. So we would be looking at a situation where we’d be buying bottles from Mexico, importing them into the U.S., just to dump it out here and put it into another bottle and call it Zuzu. And that felt like a lot of waste for us. So this just felt like the best way, at our scale, to get a really pure product.

Z: And I’m wondering too, back in your “dark days” you described with sweet potatoes and nutritional yeast, was tequila always the spirit of choice? How did that become something that you and Greta gravitated towards?

A: Yeah, it has always been the spirit of choice for us. I think the flavor of it is so great. It’s a little bit sweet, but it’s also the healthiest of them. It has the fewest calories. And we anecdotally looked around and suddenly, it was like everybody was drinking tequila sodas. And so I think it came from a place of the flavor itself, and then the quality of tequila and it felt healthier than other options out on the market.

Z: And I’m wondering, too, you mentioned the fact that Zuzu is five percent alcohol, which I don’t know in positioning it, it’s obviously not no-alcohol. But it definitely fits into this broader low-alcohol range of drinks. And I’m wondering, I think this isn’t a question with a right or wrong answer. I’m just curious, was it more about getting to that number because that’s what gave you the “health” profile that you were looking for? Or was it “hey, we just think at this point this is where if we blind tasted 15 different formulations ranging in alcohol from three to 20 percent or whatever, this is the one that we think tasted the best”? That decision is something that you’re making consciously in some sense. How did you make that decision?

A: Yeah, we tested all different ranges of ABV. And you’re right, three percent it was like, do we even feel it? And seven percent, suddenly you’d have one and you’d start to feel you’d have two and suddenly you’d feel really drunk. And that’s not something that we wanted. We want Zuzu to feel like a really nice way to take the edge off. Something that you could have on a weeknight either alone or at a nice dinner party with your friends if we’re ever able to do that again. Fingers crossed. So it’s just the right amount to make you feel good and take the edge off, but also low enough that you wake up and you don’t feel like garbage the next day and your liver has time to process the amount of alcohol. So I think that “sessionable” aspect of it was really important for us.

Z: Gotcha. And so on that note, one thing that’s in the press release you guys set out, which let’s say you’re going to have to convince me of something. Which is that Zuzu was described as a “hangover proof” drinking experience, and I understand that to some extent, you don’t mean, if someone drank 20 of them, there would be no repercussions. Obviously, anyone who can think critically doesn’t really think that’s true. But I guess I’m wondering what does that mean? And also, as someone who is in his now, sadly, late 30s and ever more aware of how much hangovers suck. Why is that in particular such a selling point? Because I guess what I mean is, I think there are certain drinks that are targeted at certain demographics that are like we know you’re not going to care. Like, the next morning is not your consideration. Obviously, that’s not what you’re targeting here. So maybe also if you can talk about who you envision — obviously you would love everyone to drink this — but when you’re thinking about the person who is “hangover-conscious,” or alternatively not unconscious, who is that?

A: Yeah. Well, first of all, let me just say it’s definitely not hangover proof. I mean, you drink 10 Zuzus, you will likely feel hungover the next day because alcohol is alcohol. It’s ultimately an ethanol. So what we’re doing is trying to create the conditions of minimal hangovers, which gets back to our fundamental thesis that I spoke about before, that less ingredients is better. I think for us, what’s important here is that there are no synthetic sweeteners or no artificial preservatives or no other additives that will make you feel hungover or accelerate your hangover. It’s just exactly what it says that it is. And I think that our customers care about that because she is a person who cares about what goes into her product. She’s the person who looks at her nutritional lists at the supermarket. And she’s the professional person that wakes up the next day and does feel like she needs to get to work, and doesn’t have time to be super hungover in the morning. I keep saying “she” but my brother, for example, is probably Zuzu’s number one fan. So let that be known.

Z: And I’m wondering, on that note, I guess I have to tell you two questions that I want to get to and they kind of go in different directions. So I apologize. The first one there is when you are working without preservatives and you’re working without all those things, is there a discernible shelf life for this? Is that a consideration? Obviously, alcohol helps, and even carbonation helps to some extent. There’s actual fruit obviously in both of these, and not just citrus. What is the shelf life on these?

A: Yeah, it’s a great question. Thank you for asking because I spent about a year in R&D trying to figure out this question and the shelf life is 12 months on this. And that’s pretty remarkable because there are so few ingredients in it. I can’t tell you how many times along the way people push you to do what is the status quo, which is add potassium sorbate, which is a preservative, or there’s this product called Valkyrien…

Z: Oh yeah, I’m a wine person so…

A: Okay, yeah you get it. You literally have to wear a hazmat suit to touch it,and people are like, “just put some Valkyrien in it.” So what we do at Zuzu, and it’s low enough in alcohol that actually the alcohol doesn’t kill off all of the bacteria. And we do have six or seven percent of the quantity of it as juice. And that’s why it tastes so good. And that means that we pasteurize our product, so we heat it for a certain time and at a certain temperature. And once it’s been in bottles then that kills the bacteria. And I think part of the reason why it took us so long to get Zuzu out onto the market was finding the right person that could manufacture this for us, that we really trusted and cared about the quality of our ingredients, because we were unwilling to just throw these preservatives into it.

Z: Gotcha. And then my other question is, you mentioned obviously a guiding light for you and Greta, in designing these was citrus and “tartness.” And I would imagine, like I said, I haven’t tried them, but I would imagine that both the Calamansi Lime and Passionfruit bring a lot of that. Is there another either specific flavor or alternatively, are you thinking, “okay, well, two flavors is great,” but presumably the intention is not to stop there. Like what are the other dimensions you’re looking at?

A: Yeah, we definitely want to create more flavors. I think we at this point are learning so much, now that Zuzu is in the market, about what people like. Interestingly, lime is the gateway drug and then passionfruit slowly creeps up on people so that they start spinning about which one they like more. It’s fun for me to watch. But our goal right now is we are developing a couple of other flavors, but we really want to hear from our customers. We want to hear from people that are Zuzu drinkers that are like, “I love sour cherries, can you please make a sour cherry one?” Or like, “grapefruit is the only Spindrift that I drink.” And that’s what I need you guys to create next. I think we’re just trying to get as much feedback as we can from our customers and listen to what they want and produce it.

Z: Very cool. And last of all, for people who are interested, what’s the step for them to take to track down Zuzu?

A: Well, if you’re in New York State, you can go onto our website, drinkzuzu.com, and you can have Zuzu currently delivered straight to your door, or you can get it delivered through our local marketplace, which is also on our website. And there’s also a list of stockists there. So you can actually go to the store and buy it in person. I will also say that we should have national shipping in the next month or so. So you in the hinterlands of Seattle can get it delivered straight to your door, which we’re really excited about, because there are a bunch of people out in the country that are asking for it now, which we’re very, very thankful for.

Z: Awesome. Well, Ali, thank you so much for your time. Appreciate it. I look forward to giving the product a try one of these days. When the covered wagons make it all the way out here.

A: To the Wild West!

Z: Yeah, exactly. And yeah, thank you so much for your time. Appreciate it. And best of luck with Zuzu going forward.

A: Thank you. Thank you. I really appreciate it.

Thanks so much for listening to the VinePair Podcast. If you enjoy listening to us every week, please leave us a review or rating on iTunes, Spotify, or wherever it is that you get your podcasts. It really helps everyone else discover the show. Now for the credits. VinePair is produced by myself and Zach Geballe. It is also mixed and edited by him. Yeah, Zach, we know you do a lot. I’d also like to thank the entire VinePair team, including my co-founder, Josh, and our associate editor, Cat. Thanks so much for listening. See you next week.

Ed. note: This episode has been edited for length and clarity.

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