Clearly Canadian tries crowdfunding comeback

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The Toronto Star | | Jan 22, 2015

Clearly CanadianClearly Canadian under new American ownership after filing for bankruptcy in 2010, and it aims for nostalgia-fueled comeback.

After falling off the radar, Clearly Canadian is back and hankering for a crowdfunding comeback — this time led by an American.

Robert R. Khan, a venture capitalist, has bought the once-legendary Canadian brand in the hopes of returning it to its former glory. Khan plans to relaunch the drink, which ceased production in 2009, with a little help from nostalgia-hungry consumers.

“I grew up on Clearly Canadian,” Khan said. “It was a cultural staple in the United States as much as in Canada throughout the ’90s.”

In a move similar to crowdfunder Kickstarter, Clearly Canadian is asking consumers to preorder a case in order to help get the production line going. According to the brand’s new website, it needs to pre-sell 25,000 12-pack cases in order to kick off its first order. The campaign launched in winter 2013, and so far they’ve sold almost 20,000 cases.

Once it reaches its target, the site says, production will start and bottles will be shipped to those who preordered a case as well as retailers across the continent.

“Taking over Clearly Canadian, it was like inheriting 7Up,” Khan said. “There’s nothing start up really about it.”

Clearly Canadian was founded by Douglas Mason in 1988 in Vancouver, B.C. The sparkling and sweet beverage hit its peak in 1992 with sales over $150 million and TV spots on popular shows like Seinfeld.

Like flannel, beepers and crop tops, Clearly Canadian quickly became an iconic symbol of the Gen-X quirky consumer.

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The fall of Clearly Canadian was as stunning as its initial rise. In 2005, Mason resigned a chairman while the company’s stock continued to decline. By 2010, Clearly Canadian filed for bankruptcy with only $12,000 cash to its name. It also ceased trading publicly.

In a March 2010 trustees report, the dire situation was laid bare to creditors:

As its financial fortunes waned it suffered high turnover in its management team ... It has moved premises into what is now a very modest office/warehouse complex that it shares with its subsidiaries . . . Computers have been given to departing employees in lieu of severance . . . They still list capital assets which physically don’t exist.

How did a company with such enormous brand recognition become a shell of a business?

For starters, said Peter Van Stolk, a veteran in the beverage industry, people found out it wasn’t water.

Clearly Canadian emerged in a time before nutrition facts were mandatory on beverage bottles. Fizzy and fruity and, as the name suggests, clear as a mountain spring, people naturally assumed the beverage was like Perrier with more flavour.

But with about 90 calories per 250 mL, Clearly Canadian is closer to Coca Cola than H2O.

“Everybody’s thinking they’re drinking water . . . but it’s just clear pop!” said Van Stolk.

“The biggest mistake we made was not selling out to Pepsi,” Mason said. During the brand’s heyday, Mason said PepsiCo. made an informal offer to buy the company. He turned it down, hoping he could make the company into a billion-dollar brand himself.

A few years later, Crystal Pepsi launched, and failed, and Clearly Canadian’s fortunes took a turn for the worse.

Another nail in the brand’s coffin was its move to a larger bottle size in 2000. During the era of the supersize, they decided to move from an 11 oz. bottle to a 14 oz. bottle. The logic behind the decision was that consumers thought bigger was better, but what the company didn’t account for, Van Stolk said, was the extra cost of shelf space.

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