How Poppi grew from farmers market to $1.95bn acquisition: A startup case study

In the space of just six years, Poppi transformed from a home kitchen gut-health experiment into one of the most talked-about exits in the modern beverage landscape. PepsiCo’s May 2025 acquisition of Poppi for $1.95 billion not only marked one of the largest strategic beverage buyouts in recent years—it also offered a blueprint for how modern CPG startups can engineer exponential growth through authenticity, influencer marketing, and functional nutrition positioning. At its core, Poppi’s story is about aligning cultural timing, consumer trust, and digital virality into an acquisition-worthy growth curve.

How Did Poppi Begin? The Origin Story Behind the Brand

Poppi’s origin traces back to co-founder Allison Ellsworth’s personal struggle with gut issues. Frustrated by a lack of appealing and accessible digestive health products, Ellsworth began experimenting with apple cider vinegar-based tonics in her home kitchen in Dallas, Texas. Working with her future co-founder and husband, Stephen Ellsworth, the pair began refining flavor profiles that would balance vinegar’s acidity with natural fruit juices and minimal sugar.

Initially called “Mother Beverage,” a nod to the fermented “mother” in unfiltered apple cider vinegar, the drink debuted at local farmers markets around 2016. The response was immediate. Customers were drawn to the unique combination of tangy refreshment and wellness functionality—a far cry from both kombucha and traditional sodas. With momentum building, the founders rebranded to the more playful and accessible “Poppi” in 2019 after receiving early feedback from investors and consumers.

When Did Poppi Go National? Early Exposure and the Shark Tank Effect

Poppi’s first major visibility boost came in 2018 when the founders appeared on ABC’s Shark Tank. Their pitch, still under the “Mother Beverage” branding, caught the attention of entrepreneur and branding expert Rohan Oza, who invested $400,000 for a 25% stake. Oza, known for his work with Vitaminwater and Bai, helped reposition the product from niche health tonic to mainstream functional soda.

Post-Shark Tank, Poppi revamped its packaging, honed its flavor lineup, and accelerated retail distribution into Whole Foods and Sprouts. With a growing team and celebrity connections, the brand began to appear at wellness expos, retail incubators, and even influencer gifting suites. However, its biggest growth driver wasn’t traditional retail or PR—it was TikTok.

How Did Poppi Become a Viral Beverage Brand?

By 2020, Poppi was ready for its breakout moment on TikTok. The brand embraced creator culture before it became a CPG norm. Poppi’s vibrant cans, easy-to-explain health benefits, and refreshing taste made it highly shareable. A single video by co-founder Allison Ellsworth, breaking down how apple cider vinegar benefits gut health, went viral and helped generate over 1 million impressions. The video’s success led to a cascade of user-generated content that fueled the brand’s online visibility.

What set Poppi apart wasn’t just the TikTok campaign—it was the emotional equity behind it. Users felt like they were discovering something new, healthy, and community-driven. The packaging was colorful, the messaging was authentic, and the benefits—digestive support, low sugar, and clean ingredients—matched the expectations of a new generation of wellness consumers.

Poppi’s follower count exploded, its DTC channel boomed, and major retailers took notice. By late 2021, the brand was in Target, and by 2023, it had national distribution across major chains including Kroger, CVS, and Walmart.

What Was the Business Model That Made Poppi Scale-Ready?

Poppi combined a DTC-first approach with rapid retail expansion, allowing it to build consumer affinity online before leveraging mass-scale channels. The brand’s subscription model, paired with TikTok-driven customer acquisition, gave it enviable unit economics and customer lifetime value (LTV) insights. Early funding from CAVU Venture Partners, a consumer brand-focused VC firm, helped Poppi scale inventory, packaging improvements, and retail onboarding.

Operationally, Poppi relied on contract manufacturing (co-packing) to scale quickly without heavy upfront capex. This allowed them to flex production capacity in response to viral spikes in demand without diluting brand quality. In parallel, the company ran geo-targeted retail campaigns, using digital engagement heatmaps to guide in-store activation strategies.

By 2024, Poppi was reportedly generating north of $100 million in annual revenue, with year-on-year growth above 80%, and strong velocities in natural and mass retail channels alike.

Why Did PepsiCo Acquire Poppi in 2025?

The $1.95 billion acquisition price—netting out at $1.65 billion after tax benefits—was seen by many as a premium valuation, especially for a company just breaching nine-figure annual revenue. But for PepsiCo, Poppi represented far more than a revenue line. It was a gateway into Gen Z beverage culture, gut health credibility, and digital-native brand architecture.

Ram Krishnan, CEO of PepsiCo Beverages North America, noted that Poppi’s cultural relevance and functional positioning aligned perfectly with the company’s Positive Choices growth strategy. PepsiCo has been methodically reshaping its beverage portfolio to appeal to health-conscious consumers, and Poppi fills a clear white space between flavored sparkling water and kombucha—two categories PepsiCo has tried but not fully dominated.

The deal structure included a performance-based earnout, signaling that PepsiCo views Poppi as a long-term brand play, not a short-term revenue booster. Integration is expected to begin through PepsiCo’s DSD system, unlocking national reach and retail leverage, while preserving brand identity and leadership continuity.

What Made Poppi an Acquirable Brand?

Several elements made Poppi “acquisition ready” by 2025. First, the brand had a clear functional differentiation—prebiotics and gut health—which made it stand out from flavor-only competitors. Second, its repeat customer rate was high, driven by perceived wellness benefits and flavor satisfaction. Third, the founders built a brand with community, not just a product with a price tag. That community translated to lower customer acquisition costs and higher retention in both DTC and retail channels.

From an institutional perspective, Poppi had reached the scale where returns on ad spend (ROAS) were stable, and category growth data validated continued consumer adoption of functional sodas. The category was moving from trend to staple, and PepsiCo’s early acquisition meant beating rivals like Nestlé or Coca-Cola to a culturally established brand.

What Comes Next for Poppi?

Now under PepsiCo’s umbrella, Poppi is expected to expand into international markets and potentially adjacent categories such as energy hydration, mood-boosting beverages, or snack pairings with gut health ingredients. While the brand’s founders are expected to remain involved in the short term, PepsiCo will likely deploy R&D, data analytics, and retail optimization to refine flavor portfolio decisions and pricing architecture.

The biggest challenge will be preserving Poppi’s indie brand feel while rolling it out at the scale of a multinational CPG operation. If successful, Poppi could become the next evolution of soda—gut-forward, digitally native, and unapologetically joyful.

A Modern Case Study in Building, Branding, and Exiting Right

Poppi’s $1.95 billion journey isn’t just a success story—it’s a case study in how to build a functional brand that feels emotional, accessible, and modern. It shows how consumer demand, scientific storytelling, and social media fluency can now outperform legacy advertising spend. It also reflects a new truth in beverage M&A: the brands winning shelf space today are those that win scroll space first.

Whether other brands can replicate Poppi’s arc remains to be seen. But for now, Poppi is the benchmark for what happens when culture, commerce, and consumer health perfectly align.