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The Ashton Kutcher, PepsiCo-backed Start-up Redefining Hydration Through Scent

All the juice on German start-up Air Up, which in three years has raised more than 60 million euros in investments.

MILAN — For German start-up Air Up, improving human health conditions and environmental impact is as easy as drinking a glass of water.

The Munich-based company has been making waves since its inception in 2019 with its clear, two-fold mission and a simple yet innovative execution. To encourage people to increase their daily water intake without the unnecessary use of sugar or artificial additives, as well as to minimize the plastic consumption, Air Up developed a refillable drinking system that flavors ordinary tap water — through scent.

The approach quickly drew the attention of investors, including PepsiCo Inc., Ashton Kutcher and talent manager Guy Oseary, who have been backing the company and boosting its distribution and product expansion. Air Up recently debuted in the U.S. and launched new bottle designs.

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The brand’s overall concept centers on the phenomenon of retronasal smell. According to the company’s scientific research, 80 percent of taste is based on scent, and the start-up leveraged this aspect to trick the brain into thinking that scent is taste.

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Air Up
Air Up Courtesy of Air Up

This resulted in the development of lightly scented and interchangeable pods meant to be applied to the head part of a 650-ml. bottle, made from BPA-free Tritan. Available in eight colors, the bottle enables users to switch the scent on and off according to their preference. The company has gradually developed an array of pods for a total of 27 flavors so far, including cherry, peach and coffee, as well as combinations such as basil with lemon or raspberry with lime. Each pod can aromatize at least five liters of water.

Since the company has reached more than two million customers, it estimated it has potentially saved 130 million single-use plastic bottles and more than 2,600 tons of sugar.

Last year, Air Up raised more than 60 million euros in two investment rounds, first collecting 20 million euros at the beginning of 2021 — from key players such as PepsiCo and French food-tech investor Five Seasons Ventures — and then 40 million euros in September.

In its first year, it generated 2.4 million euros in sales, which grew to 21 million euros in 2020 and jumped to more than 90 million euros last year. The company said it aims to double the 2021 revenues this year.

Air Up
Air Up Courtesy of Air Up

This exponential growth was propelled by the company’s rapid expansion. Before launching in the U.S., the German brand rolled out in nine European countries, including Austria, France, Belgium, Italy, the Netherlands, Switzerland, the U.K. and Sweden, in addition to its domestic market.

The U.S. marks the first step outside the continent, as well as a strategic move for Air Up, which cited studies according to which 75 percent of Americans remain chronically dehydrated. This opened an opportunity for the start-up to further pursue its mission of making plain water an easy and attractive choice, while saving plastic and CO2 from bottles’ transportation in the process.

“Our goal is to offer a new, healthy and environmentally friendlier product without compromise,” said cofounder Lena Jüngst, who had the idea for the concept in 2016, while studying product design with Tim Jäger at the University of Design in Schwäbisch Gmünd, Germany.

“We’ve seen meteoric growth and excitement around the brand in Europe, and we know our drinking system presents a much-needed solution to the U.S. hydration problem,” said Jüngst.

Air Up co-founder Lena Jüngst.
Air Up cofounder Lena Jüngst. Courtesy of Air Up

For the moment, a portfolio of 10 flavors is available in the U.S., including classic options such as lemon and cucumber or combinations like mango and passion fruit.

In the U.S., the aroma pods and bottles can be purchased exclusively on the brand’s e-commerce site, while distribution in Europe flanks the online store with a selection of physical retailers, too.

Prices start at $39.99 for an entry set that includes a bottle and a pack of three pods, but consumers can also purchase stand-alone packs of pods starting at $7.99.

This week, a new, more mature version of the brand’s design bottle debuted in Europe. Made of stainless steel and rendered in black, it keeps the water cool for up to 14 hours and comes with a price tag of 59.95 euros.

Meanwhile, the company is also working on expanding the variety of pods as well as making the products, production and supply chain more sustainable. To this end, Air Up said it plans to relocate a large part of its production to Europe by the end of the year.

The company has a pod production site in Turkey, but it is working on opening one in the Netherlands, which will add to warehouses already established in France and the U.K. Additional plants for bottles in Germany and Austria are on the agenda, too, with the goal to bring the product closer to customers and shorten transportation. The firm’s goal is to enable production of the European products in the continent by the end of 2023.