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The Honest Tea Culture: No Frills, but Plenty of Support

By Motley Fool Staff and Tom Gardner – Mar 18, 2014 at 5:00PM

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Words like "entrepreneurial" and 'empowered" come up when CEO Seth Goldman discusses Honest Tea’s company culture.

Seth Goldman and Barry Nalebuff founded Honest Tea in 1998. In the recently released Mission in a Bottle, the co-founders tell -- in comic book form -- the story of building a successful mission-driven business. Goldman, now president and "TeaEO" of Honest Tea, joins Motley Fool CEO Tom Gardner to discuss sustainability, entrepreneurship, and what it means for a socially responsible, health-oriented business to be bought by Coca-Cola (KO 1.64%) .

With a great rating on, it's no surprise that Goldman describes a strong company culture at Honest Tea, and deep appreciation for the employees -- who are depicted as superheroes in Mission in a Bottle.

A full transcript follows the video.

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Audience member: Wonderful and informative panel, thank you.

What would you describe your company culture as? How many employees do you currently have, and what is that relationship with Coca-Cola?

Seth Goldman: That's interesting actually, because when Coke invested we had 47; today we have 112.

This is my belief, so you should ask them, but it is a very entrepreneurial, very free-spirited culture. I say "entrepreneurial" because we're not very stratified, but every manager has their own P&L that they manage -- profit and loss statement. They control their expenses. Their rewards and compensation are based on their performance of hitting their targets, and they control it all. We're not just practicing it, we're (unclear 00:41:40).

It's interesting, because before Coke bought the company everyone had options, and I thought that was the big motivator; literal ownership. But actually, since the transition we really haven't lost -- obviously there's some transition -- but there wasn't a big migration away, because people still got to have ownership of the business.

We are ... I don't want to use the word "cheap," but we live leanly. We still share hotel rooms when we travel -- which is not for everybody, but I can tell you it's a great way to weed out who's not going to be part of it! That's not for everybody.

Gardner: Shared rooms at the Four Seasons?

Goldman: No, if we're lucky it's a Hampton Inn!

Our office furniture ... I guess you can call it "reclaimed," as opposed to "used." But we also really do what we can to try to support people on their journey toward better health, and it's really exciting to see how people have empowered themselves to take really significant changes around that.

We have a company meeting that comes up every year, and it's kind of like a family reunion. The other thing we do is, when we launch in a market we all go out and travel to the market, and that's a great bonding experience.

Gardner: One of the things that's changing is that employees, past and present, are getting to review companies on sites like Glassdoor. I don't know if you've ever seen that site, but I recommend it to anyone who's looking for evaluating a company in any way.

It's anonymous, so the company cannot control what is being said about them, and there's a rating number attached to it. Honest Tea is very, very highly rated by the past and present employees of Honest Tea.

Goldman: And I just want to note that the book is dedicated to our employees because, although Barry and I certainly put our own energy and the capital in, the employees were the ones who made this happen and there's no other way to tell that story. In my favorite pages in the book, there's two superhero profiles, and they're both our salespeople, with their cooler bags, looking off into the bright future.

Gardner: Love it.

Tom Gardner has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Coca-Cola and has the following options: long January 2016 $37 calls on Coca-Cola and long January 2016 $37 puts on Coca-Cola. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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