Entrepreneurs Erin Levine and Sky Pace Build Business Their Way
The Alameda couple is pushing the envelope on friendly divorce and the craft soda industry from their Bronze Coast bungalow.
Photo by Lance Yamamoto
Erin Levine and Sky Pace are one of those couples who interrupt one another’s stories with compliments.
When Pace tells about how he ended up in the beverage business after film school, Levine interjects, “And you became an executive.” When Levine doubts that her legal help website could go national, Pace predicts that she will be revolutionizing the legal profession nationwide, and soon.
Add a couple of self-assured little girls popping in and out of the backyard of the family’s Bronze Coast bungalow, trailed by a sweet and efficient nanny/assistant, and you have what looks like a model of family functionality. It’s ironic, then, that this house is the cradle of Hello Divorce, a 1-year-old website that Levine and collaborator Jennifer Heller created to affordably ease unhappy couples out of marriage.
While Levine, who already had a thriving family law practice, toiled nights and weekends challenging the stodgy legal business model, Pace was pushing the envelope in his own industry, transforming Brix Beverage, his fountain soda distributorship, into a soda producer, with its own brand, Alameda Point Craft Soda Co. He stopped distributing 7 Up in favor of Golden Gate Orange, Oaktown Rootbeer, and Park Street Bridge Ginger Ale, all mixed up in Hangar 25 on Spirits Alley and served at Alameda spots including Trabocco Kitchen and Cocktails, Scolari’s, and The Star on Park.
Both businesses are humming along, allowing their founders to make it home for dinner most nights and enforce “no phone” time to focus on their daughters Zoe, 6, and Mia, 3. But that equilibrium is pretty new. Three years ago, Pace’s company was losing $200,000 a year, and Levine had to subsidize it from her law practice.
“We always do that for each other,” Levine is quick to point out, reminding Pace of all the hours he put in helping her set up her law firm and Hello Divorce’s business structure.
To make things more chaotic during that tough year, the couple were expecting their second child, and due to a kitchen remodel, they had decamped to an RV parked outside the Brix warehouse on Alameda Point.
“I can’t fit in the shower!” Levine remembered lamenting, while her husband talked about putting a second mortgage on the house.
“I was like, I don’t understand why she’s so emotional about this,” Pace joked, and puts a hand on his wife’s shoulder.
Bankruptcy looked like the most responsible move for Brix. Instead, Pace launched a moonshot to save the company by formulating his own sodas using natural flavors and real sugar instead of corn syrup.
“Everybody told me you have no money and you’re going to try to launch something? This is the stupidest thing ever,” Pace recalled.
But it worked. Selling house-made soda instead of 7 Up not only felt great, it brought his gross margin up to 75 percent and allowed him to pay back $70,000 in debt.
“We are now in the black and doubling our size every year,” Pace said.
Meanwhile, Levine launched Hello Divorce, an online service that combines the self-service affordability of legal websites such as LegalZoom and It’s Over Easy (another divorce site) with the assurance that comes with working with an established law firm — for a fraction of the cost of retaining a divorce lawyer. Targeting uncontested or low-conflict divorces, the company offers different levels of handholding, from a free “starter membership,” through the $99-a-month DIY option, up to Divorce With Benefits, flat fee $6,750.
Compare that to the average legal fees in a California divorce: $13,800. Not only is Hello Divorce cheaper than the typical law firm, it’s also more transparent about the costs and the process, Levine said. And it all comes packaged with upbeat content focused on getting to the next steps in life.
Levine’s goal with the site is to let people to pay for the help they need, while empowering them to take care of what they don’t need help with. Leveraging technology helps, such as offering forms that the client can fill out online and then have checked by attorneys and allowing clients to request a half-hour chat with a lawyer with a click of a button. Clients — the company has helped process 65 divorces in its first year — might choose to have a paralegal prepare all their documents, then purchase one or a few hours consultation time with a divorce attorney.
Legal empowerment is important to Levine.
“I spent a lot of time in the legal system when I was a late teen,” Levine said. She was a witness in criminal case and a plaintiff in a civil case against a gymnastics coach who sexually abused her. “It was so disempowering and lonely and scary. The reason I went into law is to help people get through that experience. While I get to do that to a certain extent with Levine Law, not as much as I really wanted to.”
After one year, Hello Divorce is breaking even with its monthly expenses, although the couple acknowledge that they haven’t made back the money they’ve invested in the company. Neither Brix nor Hello Divorce has taken on outside investment.
Now, both are poised to grow their businesses. For Pace, that means he’d like to start bottling his craft sodas, currently only available as fountain drinks. Levine is constantly looking to add functionality to Hello Divorce, and she figures that if she could capture even 3 percent of the 300,000 divorce petitions filed in California each year, Hello Divorce could grow into a multimillion-dollar business. Just to keep things interesting, Levine is also launching another online service, Love & Real Life, focusing on prenuptial and cohabitation agreements.
With family on the front burner, growth for all these businesses has to come on their terms.
“When we talk to investors, oftentimes they want me to grow at a pace that would not allow me to be a wife or a parent. Or Y Combinator. I can’t leave my family and go to Silicon Valley for three months,” Levine said. “We want to grow deliberately.”