September 01, 2015
FuXion Biotech: Bringing the Abundance of the Ancient Amazon to America
by Lin Grensing-Pophal
Headquarters: Lima, Peru
Founder: Álvaro Zúñiga Benavides, Chairman and CEO
Products: nutritional beverages made from Andean, Amazonian and Oriental fruit and vegetable extracts
2014 Net Sales: $80 million
|Álvaro Zúñiga Benavides|
|Rafael Zúñiga Benavides|
FuXion Biotech is a small-to-mid-size company with origins in Peru that is poised to make a market push into the United States. Its products have gained traction in its current markets, and its tagline, “We Improve Your Life,” has resonated across Latin America. Will the company be able to leverage past experience and sell its commitment to “True Health” in a competitive North American consumer climate?
The Science and Passion behind FuXion
In 2006, driven by his passion for a healthy lifestyle, Álvaro Zúñiga Benavides founded FuXion. The company sells beverages, teas and shakes made from Andean, Amazonian and Oriental fruit and vegetable extracts, products that draw from his 10 years of experience in the functional foods industry, which is rooted in the conviction that certain foods can have an impact on health that goes beyond simple nutrition.
Álvaro has long been passionate about the potential that certain foods contain. That passion has led him to his current position as Chairman and CEO in the company he founded, a large and growing direct sales organization, which also manufactures its products. The initial funding of the company came from friends and family, most notably from Derek and Frank Mitchell, two of Álvaro’s childhood friends who grew into successful entrepreneurs, and from his brother, Rafael Zúñiga Benavides, who was an investment banker in Europe at the time, now serving as an Executive Board member.
Álvaro’s interest in nature, invention and innovation began at a young age. As Rafael explains, “His curiosity never ended. He was always trying to understand how to improve nature’s healing effects through homemade food recipes.” That passion evolved into FuXion’s business mission to help people improve their lives in a journey for True Health and the transformation such a focus could make. For FuXion, True Health involves three aspects of health: physical, emotional and financial.
FuXion was founded on the strong belief that ancient knowledge of millenary cultures could be leveraged using modern biotechnology. The company’s products are made by merging more than 1,500 active ingredients extracted from natural foods and combining them in unique formulations with modern technology to multiply the benefits of each. Álvaro calls this process “nutraceutical fusion,” and it is based on his years of study in obtaining the active ingredients from specific foods and blending them with other food ingredients, enhancing them with micronutrients.
But, while ancient knowledge and modern biotechnology fuel the creation of FuXion’s products, it is the passion behind the personal transformation processes that really distinguishes the firm, Rafael stresses. The company’s corporate staff, their distributors and customers are part of a big family, he says. They embody “Latin passion,” a combination of passion, joy and above all love for family, which he notes is not a passion that resides only within Latin America, but that can be embodied in people from any nation and any culture.
A Commitment to Direct Sales
FuXion executives found direct sales to be the natural choice for reaching out, engaging and educating customers about the significant benefits of its products. Traditional advertising and sales simply didn’t offer the means to convey all of the information about the products without significant cost.
“It was logical that we should use word-of-mouth and grassroots person-to-person sales to really get the message out about our products,” says Beatriz Z. De Los Heros, Chief Marketing Officer. In addition, she notes, the traditional sales channel couldn’t address the emotional and financial health components necessary for True Health.
FuXion’s almost 50,000 active distributors, supported by a team of 600 FuXion staff members, share the company’s passion. “We have strong teams with dynamic leaders who recruit fast, but not so fast that they lose people along the way,” says Renato Pastor, Chief Operations Officer. “We take our time to properly enroll people, to let them fall in love with our True Health promise and make sure they are ready to give the same vision to the people they bring into the business.”
Training is a key area of focus for the company, including online training classes. But business basics are only a part of what’s covered in FuXion’s personal transformation program. In order to deliver on the company’s tagline “we improve your life,” Renato says the company’s training program—called SerFuXion (translated to BeingFuXion in English)—provides workshops, courses and life experiences that support the company’s vision. That vision is embodied, he says, “not only in our products, training and compensation plan, but also in our distributors and customers’ pursuit of an abundant and balanced lifestyle.”
Other business building enhancements include an in-process conversion of back office services that will allow distributors to better utilize the company’s online presence and will provide more powerful and flexible metrics to help them to better understand their businesses.
Each year distributors and other guests gather at an annual convention, which serves as a forum for celebration and learning. The most recent—Alumbra 2015—was held in Lima and was a “smashing success,” says Renato. “We had 10,000 distributors and guests from several countries,” he says. Numbers were almost double from the previous year and so high that FuXion had to erect a temporary building because no other venues, except sports stadiums, were large enough to host such a crowd.
FuXion’s annual awards dinner—Cena de Gala—will be held in Hawaii in early 2016 and Alumbra 2016, the company’s annual convention, will be in Medellin, Colombia.
Renato’s passion is evident and clearly shared by his colleague Lina Orellana Zimbrón, the head of FuXion’s North American operations, who came to the company with experience gleaned from other large direct sales companies. Despite her experience with other successful firms, Lina says of FuXion: “It is incredible—this is a phenomenon for me.” She says she has never before seen the level of interest in, and excitement about, a company and its culture before, even while working with much larger direct sales organizations. Specifically, she points to attendance at FuXion’s recent Alumbra event in Peru. “It grows year by year,” she says.
More than 80 sales leaders and guests enjoy the rich culture and luxurious experience of Dubai as they recognize personal goals reached as well as company growth.
A Careful Yet Passionate Approach to Growth
Today, the company has sales of more than $100 million a year; Peru is the largest market, followed by Ecuador, Colombia and Costa Rica. Still, growth has been modulated and planned. The same approach will be used as FuXion expands into the U.S.—a move that bodes well for the company as executives expect a burgeoning interest in health and wellness, spurred to a large degree by an aging baby boomer population not as complacent about moving into their “golden years” as former generations.
“We believed that we needed to develop our systems and our supply chain appropriately before really pushing into the U.S. market,” says Rafael. “And now we are poised to do just that.” The U.S. market is the most developed market in the world for direct sales, and he adds: “We believe the U.S. is primed and ready to create True Health.” FuXion established an office in Dallas at the end of July and will formally announce its entry into the U.S. market during the fourth quarter. “The entry into the U.S. is a major milestone for our firm as we expect our U.S. operations to grow within two to three years into our largest operation internationally,” says Rafael.
The company has taken its time to plan and prepare for this move, assembling and preparing teams and investing in human resources and IT platforms to support its growth.
“Since we had our team in place last year, we have invested significant time, effort and resources to renew our IT platform and computer systems, leveraging our original platform with the support of leading players in the software industry,” says Rafael. In July the company launched a new IT platform, which will allow real-time, online interactions with distributors and their customers. Improved back office systems and robust data, information and reports will make “running the business that much easier and fun,” Renato adds. “We are now in a position to help our distributors target the key positions within their organizations that need work, assess whether previous initiatives have borne fruit and define where their efforts will have the maximum payoff.”
Lina agrees that patience is one of the drivers of FuXion’s success. “Obviously we want to grow—we want to grow as big as possible. But we are not in a rush.” At FuXion, she says, it’s not just about attracting distributors and customers to the company, but retaining them. “When we enroll new people we want to have time to talk to them and put them in the same state of mind that we are. We want to give them time to fall in love with the company, to adhere to our mission.” The goal, she says, is “not only to bring people into our movement, but to convert them into raving fans.”
Toward that end, the company trains distributors to work personally with their customers to assess where they are in terms of all three elements of True Health: physical, financial and emotional. “We are really trying to get close to people. We are always trying to understand their needs to assess in which areas of life we can add value and help them improve,” she says. That patient approach capitalizes on people and their ability to connect with and engage others, a philosophy that drew company leadership to the direct sales model in the first place.
The Future for FuXion
The company’s growth has been fueled by passion: the passion of Álvaro’s early interests in invention and innovation, the passion of those who helped to fund the company’s launch, the passion of distributors and staff and, perhaps most importantly, the passion of the growing number of customers who have embraced the health potential of FuXion’s uniquely crafted products. The success of the company’s recent annual event is evidence of this passion. To ensure ample space and a health and wellness-focused venue for future events, as FuXion expands exponentially, the company has purchased 75 acres of land in the Amazon, near Iquitos, with plans to build an “experience center” called FuXionLand. The project includes building a convention center that will serve as a gathering point for distributors and their customers from around the world, says Álvaro. FuXionLand will be comprised of four components:
- A convention center where training will take place,
- A lodge and spa where guests can focus on their emotional wellbeing, relaxation, meditation and massage;
- A separate area devoted to fun and exercise, which will include activities as part of the Amazon adventure; and
- A biotech lab that will be the focus of research and product development.
FuXion plans to grow its Research & Development organization significantly, says Rafael. “We have made a strategic alliance with the Universidad Nacional de la Amazonía Peruana (UNAP) to work together in a number of research initiatives, and we are also starting new relationships with universities in the U.S. and Spain to continue exploring new product initiatives to strengthen our portfolio for the whole family,” he says.
The company’s manufacturing and food-processing technology division also is expanding, with three major initiatives planned over the next three years:
- A new automated manufacturing plant in the south of Lima (Lurín) that will allow increased capacity of 10 times in modular investments,
- The expansion of production activities into Ecuador and Venezuela, and
- Extraction capabilities with modern technologies in the Amazon.
In 2016, says Álvaro, “We will continue to grow following our customer base, and we plan to open Argentina and Brazil in South America and we will start our first inroads into Europe through Spain while starting to explore the Asian markets.”
Having reached a goal of $100 million in sales currently, the company’s next goal is $500 million in the next three years. If attained, Álvaro says, “We’re going to take our 100 top Leaders to a great place in Asia for an amazing adventure.”