September 26, 2008 in Business

WSU grad pitching sports drink

 
Kate Clark photo

Sports drinks developed by Lance Schwarzkopf sit on the shelf at Huckleberry’s in Spokane.
(Full-size photo)(All photos)

Bottles of a new, colorful sports beverage have hit local refrigerated store shelves. Claims on the packaging of the drink, Raza, sound familiar. Labels boast it enhances endurance and aids recovery after physical activity.

But the Washington State University graduate marketing the drink hopes to survive in a market dominated by giants such as Gatorade by touting the science behind his claims.

Lance Schwarzkopf helped develop the two-part drink, now offered by his one-man startup company ATP Beverages, a few years ago while studying food science as a master’s student in Pullman.

“Really what defines our products is the science,” said Schwarzkopf, 29. “We have actually formulated them differently so they digest different to meet those different needs.”

The before-exercise concoction is formulated for slow digestion rather than a sugar rush, while the post-exercise formula is meant to get sugar into the bloodstream at a faster rate, he said.

To pay the bills, Schwarzkopf works days at a Pullman molecular biology service company. Yet he wants to raise money from individual investors to grow ATP Beverages’ market share and tap more stores. He estimates he has sold more than 30,000 bottles in less than two years, mostly on the Palouse.

“He’s going into a tough market,” said Brian Kraft, who manages commercial opportunities for WSU. “The one thing that really differentiates his is there’s actual grounded science behind a lot of what he’s done.”

Raza retails for about $1.95 for approximately 17 ounces. Locally, it is sold at the Huckleberry’s Natural Market at West 10th Avenue and South Monroe Street and the Yoke’s Fresh Market on East Montgomery Avenue and North Argonne Road. It also is available at some grocery stores in Pullman and Seattle, Schwarzkopf said.

Made in Seattle, it comes in three flavors: orange mango, mixed berry and strawberry pomegranate.

The “before” product also contains caffeine, shown to delay exhaustion, an antioxidant and electrolytes to help with hydration, Schwarzkopf said.

The “after” formula helps reduce soreness and rebuild muscles more quickly by replenishing their glucose stores, he claims.

WSU’s Office of Intellectual Property Administration has “friendly informal interaction” with ATP Beverages, rather than a formal agreement to use the technology, because it was not patented, Kraft said. Officials “kind of made the call that a patent is not really a cost-effective means of protection,” he said.

“Lance is a bit of a special case,” he said. “We see very few consumer products come through our office.”

The office did help Schwarzkopf connect with Spokane business incubator Sirti, which will assist him with marketing and concocting a pitch for potential investors.

ATP Beverages is close to being profitable, he said.

“Currently our customer base is limited to the amount of cash that we have,” he said. “We need to bring in additional investors and additional partners.”

The product began in 2004, when Schwarzkopf and fellow students on WSU’s Food Product Development Team created an early version called Load N Reload. They participated in a national product development competition, and Schwarzkopf worked with other students to create a business plan.

The first Raza lines were filled by hand at the WSU Creamery. Schwarzkopf and friends filled bottles and attached labels by hand.

He rebranded the product after finding the old moniker might infringe on a foreign name, said Stephanie Clark, a professor and adviser to the team. Raza means “race” in Spanish, with La Raza referencing pride of people of Latino origin.

Schwarzkopf, an avid cyclist, wants to cater to a niche market of hard-core athletes. The company sponsors a Spokane cycling club and handed out products at a recent WSU triathlon meet.

Alex Renner, executive vice president of the Baddlands Cycling Club, said he used the beverages on recent rides of as far as 390 miles. While he also uses another energy product, Raza “seems to help,” he said.

“I haven’t felt dehydrated, I haven’t felt totally weak or anything like that,” he said. “It works for me.”

Reach Parker Howell at (509) 459-5491 or at parkerh@spokesman.com.

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