High Brew Coffee, one of the first “third-wave” canned cold brew brands in the U.S., has been acquired by Latin American beverage portfolio company Beliv, the company announced today.
Beliv is taking a 78% stake in the company, with the remaining 22% still owned by High Brew’s investors and its founder and CEO David Smith. Smith will remain with the brand as a consultant. Financial terms of the agreement were not disclosed.
“This acquisition is essential to continue developing a well-positioned and solid portfolio, backed by a consumer-centric vision,” said Beliv founder and CEO Carlos Sluman in a press release. “With High Brew we are adding a disruptive product in a booming category, through its distribution to 15,000 sale points in the U.S. and the collaboration with 54 strategic partners”.
“Undoubtedly, we share the same identity, commitment and vocation,” Smith stated, adding that “sustainability will continue to be a differential value in the operation since High Brew needs the best beans to make the best coffee, and this means supporting all those who participate in the value chain.”
Founded in 2013, High Brew helped to kickstart the cold brew coffee trend in the U.S. In 2016, it received a $4 million investment from CAVU Venture Partners and entered into a strategic distribution agreement with what at the time was Dr Pepper Snapple Group, prior to its transition into Keurig Dr Pepper (KDP). In 2018, the brand closed a $20 million Series C round.
Though its distribution arrangement with KDP has since ended, High Brew is sold in 15,000 retail locations nationwide – including Whole Foods, Sprouts, Albertsons/Safeway, Kroger, H-E-B, Costco, Raley’s, Wegmans and The Fresh Market – as well as online. The brand offers 11 flavors made with 100% Arabica beans.
According to the release, the deal fits into Beliv’s U.S. expansion strategy, which has focused on building a portfolio of better-for-you beverage brands through acquisition (such as its 2021 purchase of kombucha brand Big Easy) and innovation (plant-based energy line OCA).
While it proved pivotal to establishing the cold brew trend, High Brew has since seen much of its market share overtaken by competitors in the set like Starbucks, Danone North America’s STOK, La Colombe and Chobani.
Market research firm Circana reported retail dollar sales of High Brew cold brew coffees was down -31% to about $4.8 million in the 52-week period ending April 23. Ecommerce data was not included.
But that decline is more or less in line with the category: cold brew overall fell -29.2% in the period, with set leader Starbucks falling -43.2%. Other brands such as La Colombe’s cold brew line (-9.3%) and Rise (-6.7%) also faced dips. Meanwhile, brands whose portfolio is strictly multiserve like Chobani (+7.2%) and STOK (+5.5%) reported positive sales growth in the period, as did more recent, energy-hybrid launches like Monster (+689.2%)
The announcement arrives less than a week after KDP announced it had purchased a 33% stake, including a $300 million investment and an exclusive distribution agreement, with La Colombe, which makes a variety of dry and RTD coffee products, including cold brew and canned draft lattes.In recent years High Brew has experimented with a number of innovations to better differentiate itself in the crowded coffee category, including a self-heating can (not currently featured on its website), added protein, and nitro flavors.
Whipstitch Capital served as the exclusive financial advisor to High Brew in the deal.
“High Brew has proven itself as a coffee innovator through several successful product launches.” said Whipstitch co-founder and managing director Mike Burgmaier in a statement. “They built a solid independent DSD network needed to scale the brand in the US. With its strong brand and connection to consumers, we are confident they will continue to succeed in this next chapter. We are excited to watch them grow under Beliv’s ownership.”