Made in Arizona: Valley restaurateurs put million-dollar twist on official state drink
By Mignon A. Gould – Associate Editor, Phoenix Business Journal
Sep 16, 2024
AZ Lemonade Stand is an up-and-coming beverage brand that is taking the Valley by storm.
The company did $1.35 million in sales last year and is projected to do $2.75 million this year. The sales goal for 2025 is even loftier, at $5 million.
Founded in 2020 by chef Tom D’Ambrosio and his business partner Kyle Hollenbeck, the brand had 700 accounts by end of 2023. As of September 2024, AZ Lemonade Stand is sold in more than 60 Fry’s locations, and is available in over 1,000 retail locations throughout the Grand Canyon State.
The Arizona natives and friends, who met at Shea Middle School in Phoenix, are also partners in Aioli Gourmet Burgers where they started serving homemade lemonade — Arizona’s official state drink — in mason jars.
The idea for concocting a lemonade brand came after they opened an Aioli Gourmet Burgers inside a Fry’s grocery store. Hollenbeck said they were next to a sushi restaurant that was “cranking out all this sushi,” but they “couldn’t give away a burger.”
“We thought, ‘Oh, we’ve made it! We’re partnered with Fry’s’ … fun fact, nobody wants to eat a hamburger, a gourmet one, at that, while trying to shop in a grocery store,” Hollenbeck added.
Fry’s offered the opportunity to fill a cold case with one of Aioli’s products. They tried a burger kit and a salad, but neither worked.
D’Ambrosio said that Hollenbeck recalled how successful their mason jar lemonade had been.
“Kyle’s like, ‘Why don’t we just do the mason drinks that you used to make in the mason jar?’ And I said, alright, let’s do it,” D’Ambrosio said. “So, we put it in there, and they sold like crazy.”
Fry’s later appealed to the duo to create a product that the grocer could sell in its stores.
D’Ambrosio, a graduate of Culinary Institute of America in New York and a past winner on Food Network’s “Chopped” series, perfected the recipe and the lemonade was launched to the public in August 2022.
Concocting a recipe for success
By the end of 2022, AZ Lemonade Stand had sold 1,698 jars of lemonade, mainly through their food trucks and at Aioli Gourmet Burgers, according to the company. By the end of 2023, 489,000 jars were sold.
Growth plans call for selling outside of Arizona. The founders are working with distributors Cisco, Hensley and Shamrock to expand to other markets including New Mexico and Las Vegas.
D’Ambrosio said that what sets AZ Lemonade Stand apart from competitors is that their lemonade is made in small batches by hand with a focus on distinct flavors.
“We focus on bringing some of Arizona’s finest flavors to the lemonade,” he said.
Prickly Pear – their top seller – is a nod to the Arizona desert, while Huckleberry is an example of a flavor not everyone’s heard of, D’Ambrosio said. There are also collaborative flavors such as Rising Raspberry, which is produced in partnership with the Phoenix Rising soccer club, and Peach (#Lovepup), in support of a dog rescue called LovePup founded by Johnjay and Blake Van Es.
Other flavors include mango, strawberry kiwi and Jamaica Tea, which is described as “berry-like.”
The lemonade is made using lemons grown in Arizona and Florida, and is manufactured locally at BLT Kitchens, where the company has a shared kitchen in the Dunlap area of Sunnyslope.
AZ Lemonade Stand uses a brewing process similar to what is done for beer. Hollenbeck said after “going down the rabbit hole” of reading Phoenix Business Journal’s Largest Arizona Breweries list in August — in which he calculated that they would have made the list — he estimates they will have produced approximately 5,000 barrels by the end of the year.
“I had my calculator out, and I spent an hour and a half, and I kept checking the math, and I’m emailing Tommy .. I go, ‘Guys, if we would have submitted for this, we’re a top 10 brewery in Arizona,’” he said.
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