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Investing in Love.

Byline: Sherri Buri McDonald The Register-Guard

Business is good for Good Clean Love, says Wendy Strgar, CEO and founder of the 10-year-old Eugene company, which makes organic personal lubricant and other sexual health products.

Good Clean Love this year moved to a 4,000-square-foot space on West Fifth Avenue, a big step up from its previous headquarters in a 600-square-foot house.

The company recently used Circle Up, an online platform for angel investors, to raise $400,000, which it will use to build inventory, add to its corporate team and expand sales into Canada, Europe and Asia, Strgar said. Good Clean Love's products are already available at more than 2,000 stores nationwide.

A decade has passed since Strgar mixed her first batch of personal lubricant in her kitchen, using natural ingredients, because sex had become painful for her and the petrochemical-based lubricants her doctors recommended were making things worse.

"I started this company to save my own marriage - to have a healthy sex life," said Strgar, 52.

Over the years, she has discovered a broader market for her products.

Good Clean Love is among the top five best-selling sexual-health lubricants on the market, according to proprietary 2013 data compiled by SPINS, a company that researches markets for natural and organic products, Strgar said. Among those five, Good Clean Love was the only product that was certified organic, she said. The company received organic certification from Oregon Tilth in 2012.

Good Clean Love also is among the fastest-growing organic products in this market, Strgar said.

The eight-employee Good Clean Love does not release annual financial data.

The past few years have been a time of personal and professional growth for Strgar, also an author and blogger on how to make love sustainable.

Several things aligned, including Strgar's 50th birthday, her father's death, and her involvement in a couple of local community projects that helped her reconnect to what was important in her life and in her business, she said.

The community projects included helping South Eugene High School students found the Positive Change Club and raise $22,500 to create a memorial courtyard at the school in honor of classmates Connor Ausland and Jack Harnsongkram, who drowned off the Oregon Coast in 2011. Another effort was founding the nonprofit Positive Community Kitchen, which delivers free meals to people with cancer.

"I just decided when I was 50 that I had just a little bit of time left in my life to do what matters to me most," she said. "If we don't increase our capacity to love, it's like game over. I feel incredibly lucky that everything I do in my life is trying to get people to love each other."

Good Clean Love continued to chug along while Strgar pursued these other interests. But she admits, "there was a period where I lost focus on my business," and since 2012 there has been a resurgence.

Safety a focus

Also in 2012 Strgar discovered that Good Clean Love had been included in a study, which found it to be among the safest lubricants in the study, she said.

Many of the most popular over-the- counter lubricants contain ingredients toxic to the vaginal lining that can disrupt healthy genital flora, or lactobacilli, which help protect against infections, Strgar said.

Wanting to learn more about these studies, Strgar called one of the researchers, Richard Cone, a biophysicist at Johns Hopkins University.

"In the sex lube market, she's really unique," Cone said. "Her idea from the beginning is to try to match what's in the healthy vagina."

Cone ended up signing on as lead scientific adviser to Good Clean Love, and the company is incorporating research findings into its product development.

Good Clean Love recently introduced two new products, Restore, a moisturizing personal lubricant, and Balance, a moisturizing external personal wash. They are designed to mimic healthy vaginal conditions, with well-matched pH levels, salt balance and the beneficial lactic acid produced by lactobacilli, Strgar said.

"Love Agent"

Good Clean Love's products are available at more than 2,000 retailers nationwide, including most Kroger stores, Natural Grocers, and Whole Foods.

Strgar said her business has always been about more than the products - it's been about love. Since 2006, Strgar has been writing about how to make love sustainable - through books and a newsletter that is distributed to 10,000 readers each week.

Now she hopes to directly link that information and advice to consumers of Good Clean Love by unrolling the "Love Agent" rewards program.

About 200 people have signed on since June, but Strgar sees the potential for significantly larger growth.

Love agents (age 18 and older) are given "missions" to show love to the people in their lives. An example might be to reclaim the bedroom for sleeping and sex: adding pillows and clearing out the technology, she said. The more missions the agents complete, the more points they earn, which can be redeemed for Good Clean Love products.

To fund all the recent business activity at Good Clean Love, Strgar said she has sought outside investment.

Lesson in funding

Strgar said she was reluctant to do that after she previously ran into problems with the Willamette Angel Conference.

In 2010, Strgar, who admitted she didn't have experience financing a company, won the $165,000 investment pool put up by the conference's 33 angels. The investment was structured as a debt that would be converted to equity in 12 months if the company met milestones set out in the investment agreement. The WAC chose not to convert to equity and instead reached a settlement with Good Clean Love, which paid an undisclosed sum to end the relationship, Strgar said.

"It was an education," she said, adding that she learned that she needed help from professionals who understood startups, including a lawyer.

Skip Rung, managing member of WAC 2015 LLC, said his understanding is that the WAC no longer has any ownership interest in Good Clean Love.

"Growth curve"

Good Clean Love didn't look to outside investment again until 2012, when a buyer the company had worked with at Fred Meyer was transferred to Kroger, Fred Meyer's parent company.

Suddenly, Good Clean Love went from supplying 160 Fred Meyer stores to supplying Kroger's 1,350 stores.

Jodie Evans, founder of nonprofit Code Pink, which describes itself as a peace and social justice movement, invested $50,000 in Good Clean Love in order for it to be able to supply Kroger, Strgar said. She and Evans knew each other from Bioneers, a nonprofit educational organization.

Strgar said she recently took the step to raise more money through CircleUp because the company's "growth curve got so big."

Over 173 days, Good Clean Love raised $400,000 from eight investors, according to filings with the federal Securities and Exchange Commission, which regulates online-based investing.

Lead investors include Jamie McIntyre, CEO of Rewire Capital, and Lekha Singh, who is a friend of Evans', as well as a photographer, filmmaker, and the CEO of Aidmatrix, which uses innovative technology to change the way global aid is delivered.

Investment interest

McIntyre, who is based in Maryland, has backed more than 100 Kickstarter projects, has invested in companies through SeedInvest, an equity crowdfunding platform, and is himself a seed investor in Seed Invest, which launched last year.

McIntyre said the advantage of investing through CircleUp is "typically you're getting vetted deals."

"You're on the site with accredited investors, you get to see their questions and you can see what investors are investing in," he said.

He said he was drawn to Good Clean Love by the company's sound financials, Strgar's passion and commitment as CEO and "most of all, there's a serious problem that they're solving," he said.

"When I heard the story and found out that the leading products on the market ... are harmful to women and doctors are prescribing them," McIntyre said. "There's a severe lack of knowledge of what's in those products and what they're asking women to do. Wendy has not only a solution but a compelling solution."

"Category killer"

Before he decided to invest, McIntyre said he talked with Strgar on the phone and then over Skype.

"Then I got lucky," he said. "She was coming to Maryland to show at a natural products expo in Baltimore, so we were able to have dinner the night before. Then I met her at the expo and got to see her in action."

Most of the companies at the expo were food or supplement companies, McIntyre said.

"Out of this sea of what looked like the sameness she really stood out as having a unique product that was solving a problem," he said.

"It has the potential to be a category killer in the U.S.," McIntyre said.

"Wendy is looking global, and I think there is an opportunity for a global brand that stands for, well, love, according to Wendy," he said.
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Title Annotation:Business
Publication:The Register-Guard (Eugene, OR)
Date:Dec 7, 2014
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