Adaptogen-powered, plant-based latte maker Taika has announced the close of a $2.2 million seed round of funding from a diverse group of experienced investors, including former Whole Foods co-CEO Walter Robb. The brand also recently introduced its fourth flavor: Matcha Latte.
What is Taika?
When a former Facebook engineer, an expert barista and a food scientist all put their minds together to come up with a new concept in RTD coffee, the result was Taika. The San Francisco-based brand, launched in 2019, offers a line of premium organic coffees infused with a proprietary adaptogen blend — L-Theanine, Ashwagandha, Lion’s Mane, Cordyceps Militaris, and Reishi — that aims to “accentuate reality,” or, in other words, provide the ideal balance of caffeine and functional ingredients for optimal performance. Along with a dairy-free black variety, Taika is available as an oat milk or macadamia nut milk latte in 8.4 oz. slim cans that come in at around 80 calories each, with no added sugar.
Taking advantage of the wealth of tech companies in its backyard, co-founder and CEO Michael Sharon and the team initially beta tested the product with tech startups in the Bay Area in January 2019 to gather feedback and ideas for improvement. The approach is inspired by his background in software development, where patches and upgrades are rolled out as soon as they are created; cans even had a “version number” on the side for a time, he noted. Around that same time, the team secured a round of pre-seed investment led by Kindred Ventures. By May 2020, the brand had officially launched.
However, that version isn’t the one consumers will find today. With the COVID-19 pandemic tilting the scales in favor of ecommerce, Taika’s cold-chain refrigerated product faced significant hurdles for national growth; while working to build its retail footprint, the company had been limited to a light D2C presence with delivery available in New York, San Francisco and Los Angeles. Taking stock of the situation, the company decided to embrace iteration once more by moving to a new co-packer, changing to a shelf-stable formula and tweaking its adaptogen blend.
The new formulation was introduced at the beginning of this year, and, along with a recently launched subscription platform, has allowed Taika to evolve into a “real D2C brand,” Sharon said. Online sales are growing 25% to 45% monthly, he noted, and offline the company is beginning to add more stores to its current list of 300 retail locations, which includes Erewhon Market, Bristol Farms, Bi-Rite Market and Zabar’s.
What’s the story behind the new investment?
Through round leader (and existing investor) Obvious Ventures, Taika has the backing of a team experienced in supporting disruptive CPG brands, with a portfolio that includes names like Beyond Meat, beam and Urban Remedy. Along with Kindred, PE firms Human Ventures and Quiet Capital also joined the round.
But moreso than the $2.2 million itself, this round was about the addition of several experienced operators from a range of different backgrounds. That group includes Alexia Brue (co-Founder of Well + Good), Sophia Amoruso (founder/CEO of Business Class), Sean Tsao (co-Founder of delivery app Caviar and owner of Halal Guys), and Ryan Tedder, lead singer for One Republic and the creator of CBD-infused sparkling water brand Mad Tasty.
Also on the list is former Whole Foods Markets co-CEO Walter Robb. Sharon said Robb, a fellow San Francisco Bay Area resident whom he described as a longtime friend, had been close to the brand for some time, testing and sharing thoughts on each of the drink’s various iterations. While praising his generosity with his time and connections, Sharon said Robb’s interest in the brand was born out of his enthusiasm for the product itself (macadamia latte, in his case) rather than the business potential.
“The one thing that kind of ties it all together is that everyone fell in love with the product and believes in it,” he said, citing his experience with Amoruso, who committed to invest after trying the first-ever version of Matcha Latte. “If you don’t have people who truly believe in what you are doing, it’s not worthwhile.”
What is the new flavor?
Having nailed down a formulation, Taika’s next step is to introduce its fourth SKU and first tea-based product: Matcha Latte, available now. The drink features organic, Japanese-grown ceremonial grade matcha as its star ingredient, paired with the brand’s made-in-house macadamia nut milk and its signature adaptogenic blend. Sharon said the new flavor arrives in part due to consumer demand for a lower caffeine option (60 mg, or around half the content of its coffees).
What’s with the phone number?
As BevNET’s review team noted in its commentary on Taika, consumers would be forgiven for scratching their heads when it comes to the front of the can (designed by Day Job, the firm also responsible for Recess and GEN Z Water), which features the company’s hotline number prominently in the center. The concept (a “brand experience touchpoint,” as Sharon described it) was originally to give consumers a text-to-order platform similar to Iris Nova, but Sharon said that, these days, the platform has been more of a way to connect with individuals looking for little else beyond a sympathetic ear.
Through people texting the hotline, Taika has amassed a list of thousands of brand ambassadors that represent a glimpse of the brand’s engagement potential — even if they just want to talk.
“When somebody texts a can of coffee, that’s a high level of engagement,” Sharon said. “We basically have this network of ambassadors and fans — they text us and are entertained. We have people who have been texting us for over a year and a half, and then they go off and tell their friends about the conversation they had with the coffee can and that helps spread the word of mouth.”
“Especially over the past year when people have felt lonely and cut off from each other, it’s been phenomenal,” he added.