Goldman took the plunge into the bottled tea business six years ago, convinced there was an opportunity in the crowded but fast-growing market for a "less sweet" beverage.Honest Tea, where Goldman serves as president "and Tea EO, as the company puts it" now has about $6 million in annual sales and is the No. 1 bottled tea brand in the natural food marketplace.
But the sweetness profile was not the only thing that set Honest Tea apart. It was the approach Goldman took to the business.
"I wasn't just interested in starting a business," he said in an interview from his office in Bethesda, Maryland. "I knew that what we were going to do would somehow have a social and environmental impact."
Goldman established the business with Barry Nalebuff, a former professor of his at the Yale School of Management. Nalebuff had studied the tea industry in India and was the one who came up with the unusual company name.
Their challenge, like that faced by many other start-ups, was finding a way to stand out in a market full of bottled teas.
Taste was one obvious way to be distinctive, but it was the second element -- applying the approach known as sustainability -- that led to a host of decisions about the product itself.
The earliest example of this showed up on the company's first bottle of tea, in the form of a sticker that simply said "plant a tree."
The label was "kind of placeholder, a way of saying we were going to be doing something more than just selling tea, though we didn't know what it would be," Goldman said.
The program soon evolved on a number of fronts, involving choices about ingredients, packaging and partnerships that expanded the aim of its social and environmental mission.
As Goldman learned more about the business, his first aim was to shift the ingredients to organic sources to avoid toxic pesticides and synthetic fertilizers.
"Tea is one of the few products that undergoes no rinsing once it is picked," he said. Whatever pesticide residues are present on the leaf are not washed off until hot water is poured over the dried leaves -- in a pot or cup of brewed tea.
"That was a pretty clear and compelling case for why we should be supporting organics," he said.
Though there were not many sources of organic tea leaves, when Honest Tea started out, more sources became available with the rapid growth of the organic marketplace in the 1990s.
The company's first all-organic tea, First Nation Peppermint, was introduced in 1999. Now, five years later, its entire line of bottled teas and tea bags has gone organic.
Organics were the more expensive way to go, Goldman concedes, but the company shaved costs in other areas.
It eschewed a distinctive shaped glass bottle and went with a cheaper, more generic look. What it saved on packaging it put into ingredients -- and kept the price-point in the middle of the market.
This year, Honest Tea also came out with a fully recyclable plastic bottle, which was challenging in the production phase since the material could accommodate a hot beverage only if it had a precise shape. While it cost more than ordinary plastic, Goldman thought the added cost was worth it.
In other areas, Honest Tea does not staples its tea bags so they can be composted.
The company also studied ways that the brewed tea leaves at its manufacturing plants could later be used rather than end up in a garbage dump. Now they are carted away for use as organic garden mulch for plants.
Another key pillar of the business has been pursuing "fair trade," buying tea from one estate in India, for example, that is independently certified for its fair labor practices.
It also means putting money back into communities, something Honest Tea is doing in South Africa. A percentage of its sales is given back to the farmers to further develop the local business.
Asked if sustainability overall was more costly to a company, Goldman conceded it was, but it also meant that the