Cult canned iced tea and vodka drinks led by Clement Pappas and Matt Quigley were able to bring in $300 million this year.
Surfside’s backstory, the most popular ready-made spirit drink of the summer, begins with trash, especially vodka entrepreneur Matt Quigley, who has noticed on the streets of Philadelphia.
“People don’t digest their surroundings well naturally,” says Quigley, the 41-year-old president of the Pennsylvania-based state brand. “Looking at what’s broken on the curb and on the streets will tell you a lot about what people in your town are actually drinking. And in Philadelphia, it’s an incredible amount of iced tea. You’ll find twisted tea.
Quigley brought the idea to business partner Clement Pappas, 51-year-old CEO of Stateside. They tried to produce alcoholic iced tea and lemonade to compete with hard seltzers and other canned drinks, like a good version of classic twisted tea and Mike’s hard-lemo mode. And now, on the surfside for the third summer in the market, customers are crushing the surfside after surfside, especially along the beaches on the northeast coast. Surfside cans were the fastest growing beer and lady drink (RTD) cocktails this summer, with an annual retail sales of $70 million. This month, Surfside hit a milestone that surpassed the 5 million lawsuits sold in 2025, beating all of the last year’s sold.
“I’ve been in the Flat Out Sprint for over three years and I’ve been trying to respond,” Pappas tells Forbes.
Surfside is planning to sell up to 12 million lawsuits this year. This means you can earn up to $300 million in revenue. According to Nielseniq, the RTD cocktail brand had an estimated revenue of $100 million in 2024, ending as the fastest growing brand in all alcoholic beverages, achieving sales growth of over 360% compared to a year ago.
These finances have made Surfside and its parent company Stateside Brands a hot acquisition target. Pappas and Quigley, along with brothers Zack Pappas (official) and Brian Quigley (Surfside Chief Sales Officer), are four co-founders of the company, and are denying several acquisition offers at the end of this year. Papas and Quigley say they have no intention of selling to Forbes.
“We are the masters of our own destiny at this point,” says Papas.
He says they have been bootstrapping businesses for such a long time and are continuing to be properly capitalized. The four co-founders own 90% of the business together, and the Papas brothers are major investors, but the co-founders do not own a full majority. Several friends and family who invested early will make up for the rest.
Thanks to Surfside’s runaway success, Stateside is extremely profitable with an EBITDA margin of 30%. Stateside declined to comment on the profitability and ratings of the business. However, Pappas confirmed that he reinves much of his profits into the business. Forbes’ estimates are worth at least $500 million.
“On the surfside, you have the opportunity to build yourself in a company of substantial size and distribution, and everything that comes with it, all the marketing partnerships and size and capital will become the capital to launch other brands,” Pappas says. “But Surfside is a ticket to dance. If you don’t succeed, then there’s no such connection between its scale and its distribution and Costcos, Walmart and Target.”
Pappas grew up south of Philadelphia in Vineland, New Jersey. ClementPappas & Co. One of the three sons of a family with a wholesale fruit juice business called, is named after Pappas’ grandfather, a Greek immigrant. In 2011, he designed a $400 million sale of the business to Lassonde Industries (now known as Lassonde Pappas).
After he and his family acquired cash, Pappas stayed as CEO for several years, which he recalls “we weren’t exercising.” “I never wanted to sell it.”
And in 2014 he hosted a 40th birthday party at his Philadelphia townhome, and Quigley devised a plan to crash it into his business plan. A friend of Quigley’s was invited to Quigley grew up in Philadelphia as a hobby distillery in her parents’ basement, where she spent two years learning how to distill spirits with several apprentices, and sent out a copy of the business plan for Pennsylvania-made Vodka Company.
A mutual friend sneaks in the presentation at Pappas’s office, and the next day, Pappas calls Quigley and says that if Quigley wants to discuss it, he should come right away. With a fresh shower and shaving, Quigley went to Pappas’s house within 30 minutes. Two and a half hours and a few drinks later, they beat it.
“If that’s the case, it was a fun first date,” Quigley recalls.
After another six months of development, Quigley Brothers signed with Pappas Brothers. As development continued, tragedy struck in July 2015. Papas and his wife lost their immature son Peter. (Paul and Joseph of the other two sons, parents, created a foundation with a mission to cure prelammia by 2050.)
But Pappas continued to move forward. By October 2015, Stateside Vodka was on sale. In the first year, less than 600 vodka were sold. But they kept it and sales increased. And by 2018, Stateside became the biggest spirit created in Pennsylvania, with around 5,000 lawsuits being sold. The following year, sales almost quadrupled in sales, with over 17,000 cases being sold.
When the pandemic hit, the state was rare as one of the few manufacturers of vodka in the country that considered alcohol a non-essential business. When the state government shut down state-run alcohol retailers, it essentially kicked out producers outside of Pennsylvania. So, along with a limited competitor for about two months, Stateside sold vodka made from 100% US grown corn to as many Pennsylvanians as possible. From March to June 2020, Stateside achieved sales of $2 million.
“It was pretty much like a ban and a bootleg. So it was all on the board,” recalls Pappas.
This push added $1 million to the cash balance of the business, so Stateside bought a new Still to double its output and began thinking about what would come next.
In 2021, Papas and Quigley first attempted canned drinks along with state vodka. However, after Quigley’s iced tea idea was struck in 2022, whipping distillery samples and getting approval from Pappas, they spent over six months developing as Surfside at the end of 2022, and Surfside sold over 1.3 million.
Papas believes we now live in the golden age of canned spirits. The number of outlets selling RTD cocktails has skyrocketed in recent years as legacy companies have launched canned competitors. Legacy brands use their muscles to push convenience stores and small shops to carry cans when they previously only sold beer. And since white nails and many others are made from malt wine, stricter mental regulations do not apply. Eight states, including Pennsylvania, have recently changed laws to allow canned cocktails to be sold more freely.
“The window of opportunity wasn’t necessarily open 15 years ago, and probably won’t be open 10 years from now,” says Pappas. “The flood gates are open and now we are beginning to see the law catch up to where consumers are.
Man, Can, Plan: “We’re in front of them,” says Matt Quigley, co-founder of Surfside of the RTD Competition. “And when we think they understand us, we change their direction.”
Surfside
That’s why he and his team are moving quickly. Over the past year, Surfside, which has no foam or 100 calorie marketing, has been ambitiously pushed into all 50 states, working hard to stay with Boston Beer’s true hard seltzer and its legacy business twist tea, Cutwaterer’s Spirits Competition Team, thanks to 198 salespeople and distributors, working hard to stay with the perfect manager for Boston Beer’s true hard seltzer and its legacy business twist tea, Annehauser Bush’s Cutwaterer spirit competition.
“We’re in front of them,” says Quigley, a surfer. “We keep making them guess what they’re doing again, and we’re going to make them use too much, and when we think they understand us, we change their direction.”
Especially since sales of alcohol, from spirit to beer and wine, have slowed in the past thanks to the rise of non-alcoholic and low-ABV drinks.
“Surfside has been able to establish a strong foothold from the gates in these expansion markets, which is particularly impressive given the increased strength of competition from both national brands and countless regional candidates.”
Cocktails like Rtd Cocktails are one of the few areas that are actually growing in the alcohol sector, says Duane Stanford, publisher of Georgia’s Beverage Digest. Drinkers are switching from white nails and malt drinks with flavours like legacy hard tea and lemonade. According to Neilsenic, hard lemonade made with malt has dropped nearly 10% so far this year, while hard malt tea has dropped by over 4%, while spirit-based hard lemons are over 96% this year, “young consumers are moving to canned cocktails and wanting flavors. Drinks like surfside are leading this trend,” Stanford says. “The use of the vodka made and the large flavors was part of the secret to its success.”
In the more premium segment of spirit-based lemonade and hard tea, Surfside maintains a significant market share. In New Jersey, Surfside has over 76% (we overseen noon this year; in Maryland, it is 75%; in New York, it is 72%; in Virginia, it is 68% and in Florida is over 50%. Overall, Surfside currently has more than 7.5% share of the $2.8 billion Spirits-based Ready Link segment, which has grown nearly 5% points from last year.
As the brand expands further westward in its third summer season, Papas and Quigley have invested heavily in sharing in California, Texas and Illinois. Part of that strategy relies heavily on sports stadiums. Currently, Surfside is available in 12 Major League Baseball Stadiums, two NBA and 10 National Hockey League Arenas, and more than a dozen university stadiums.
For now, the surfside position is strong. And he says that business doesn’t hit any major milestones. “We feel very fortunate about this, which will be bigger than the company has been in 70 years this year than it has been a family business.”
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