Supplement appliance maker Tespo extends license to manufacturers

04-Oct-2017 - Last updated on 04-Oct-2017 at 16:08 GMT

The ‘Keurig for dietary supplements’ maker Tespo just launched a program which allows vitamin manufacturers to license the patent-pending vitamin pods, enabling them to create products compatible with the liquid vitamin dispenser system.

The first licensee will be vitamin manufacturer MegaFood, which means it can now develop its own nutritional supplements in the Tespo Pod design to use with Tespo counter-top appliances.

“Together with Tespo we will be able to provide MegaFood to current and new consumers via this future technology and innovative delivery system,” said Robert Craven, CEO of MegaFood.

Pods born out of the new partnership with MegaFood, designed for compatibility with Tespo’s second generation dispenser, is slated to launch in the fourth quarter of 2018.

Tespo co-founder: ‘We are converging science, technology and optimal delivery formats in a way that has never been done before’

Since its launch in the spring of 2016, Tespo sold its own pods, which are shaped like disks, using premixes formulated by DSM and its subsidiary Fortitech.

Tespo-2 — Tespo dispensers with the disk-shaped pods containing supplements.

The company was founded to address aversion to taking pills, which in turn affects consumer compliance of getting the right dose and amount of a supplement as the formulator intended. Tespo’s gadget dispenses the supplement in liquid form, a format that market analysts expect may overtake pills as the ‘norm’ in supplements.

By offering licenses to supplement companies, co-founder Ted Mills told NutraInrgedients-USA that he hopes a stronger relationship can be built with consumers at home.

“We don't want Tespo customers be limited to our products as we are an outcome driven company and consumers may benefit from other alternatives,” he said.

Direct to consumer, but eyeing traditional retail channels

While supplement manufacturers tackle pill aversion with solutions ranging from milkshakes to melts to shots to straws, Tespo’s founders are differentiating itself with the fact that the liquid form ensures no fillers, excipients, and other products ingredients they deemed unnecessary, according to Mills

When it launched, its dispensers sold for $129. Browsing its website today, the dispenser can be bought for $99. A 31-day serving of the product ranges between $22 and $43, with the average costing $30—a little less than $1 a day for a supplement, and around the same price range as powder and pills on store shelves.

The products are sold online on the Tespo website or through Amazon. Without disclosing specific numbers, Mills said the company has sold “several thousand” units since it launched. “We will be expanding into other third party retailing channels in the fourth quarter and moving into traditional retail in 2019 with the launch of our next generation system,” Mills added. The company is also gearing up to start a formal process for seeking Series A investors.

"While most companies are competing to meet consumers on Amazon or in the rapidly shrinking bricks and mortar world, we are building a platform to meet them on their kitchen or bathroom counter top," Mills said.

Kurt Jetta: ‘This could have a small niche if priced correctly’

The big question is whether or not consumers will be inclined to add yet another appliance to their countertop, especially one to dispense something as small a portion of the diet as do supplements.

To Kurt Jetta, CEO of retail and consumer analytics firm TABS Analytics, the gadget is gimmicky, but may have a niche “because new forms seem to have a certain constituency in [the dietary supplement category],” he told NutraIngredients-USA, commenting independently on the product.

Juicero-machine — This year was a rocky one for Silicon Valley-based juice dispenser company Juicero, who's $400 product was ridiculed because the juice pouches can be squeezed with bare hands, as a Bloomberg video revealed. There's an opportunity in the gadget space for Tespo, opined consumer analyst Kurt Jetta, because "there doesn’t appear to be an easy substitute for the delivery system."

He sees the appliance as potentially benefitting “a small niche of affluent vitamin users [who] could find this to be a convenient resource for reminding them to take vitamins.”

Any mention of ‘the Keurig of’ may make one think about the ill-fated Juicero, maker of the $400 wi-fi enabled, Yves Behar-designed juicer ridiculed by tech press and social media as a sign of Silicon Valley founder pomp.

But Jetta believes Tespo is on a different track. Not only is the dispenser moderately priced, “there doesn’t appear to be an easy substitute for the [Tespo] delivery system, so I don’t think it will be like Juicero,” Jetta said. “It will live or die based on its appeal.”

“Liquid supplements are a very low share of the category (<1%), so the first task is to convince people to switch behavior to liquid,” he added.

“They would really need to be patient with this innovation, and give it some time to gain traction. I doubt it will be an overnight success.”