Austin, Texas-based agua fresca maker Bawi has secured a new tranche of growth capital as it looks towards expansion in 2025.
The $3.5 million seed round led by Brand Foundry Ventures with additional funding from Rocanā Ventures, Amity Supply and TikTok president Blake Chandlee, among others.
“We launched in April 2022 and since then it’s been incredibly evident that the better-for-you, Hispanic beverage concept certainly has legs to stand on in mass market,” said Bawi co-founder and CEO Victor Guardiola. “A big chunk of this round is going to be used for operations, but also adding gasoline to our sales efforts.”
The new capital will fund Bawi’s impending launch in a “major natural channel retailer” in 2025, plus “a few upper-level management hires” that will pad out its sales team around the turn of the year, Guardiola said.
Bawi is currently working with about five DSDs across the U.S. but is primarily focused on building traction in California and Texas, where it’s courting “backyard” retailers like H-E-B.
Guardiola attributes the brand’s success so far on being a prime example of “cultural innovation.”
“Cultural innovation within the sparkling water or refrigerated juice category is quite literally bringing our Hispanicity into the mix,” he said.
Playing to that, Bawi recently launched its fourth flavor, La Guayaba, a pink guava variety that should be recognizable to anyone who has bought a styrofoam cup of agua fresca off a street corner in Mexico.
Startups like Agua Bonita, Frescoes Naturales or Bawi have increasingly had to compete with strategics maneuvering in the aguas fresca category. As that opportunity has grown, emerging brands have leaned into authenticity to increase velocities within their communities and among new consumer markets less familiar with the drink.
Bawi lives in the “Goldilocks zone” that caters to consumers looking for an alternative to traditional carbonated soft drinks but also between full-calorie and zero-sugar sodas as well, Guardiola said.
“A lot of beverage conglomerates thought consumers are binary within their tastes and preferences,” Guardiola said. “From a macroeconomic beverage innovation perspective, they weren’t innovating in the spread whatsoever.”
Part of what drew Rocanā Ventures to invest in the brand was that the brand brought “innovation not only to the Hispanic audience but to younger audiences that are looking for more adventurous and bolder flavors,” said Rocanā co-founder and managing partner Gurdeep Prewal. “It is straddling both the agua frescas category and the sparkling water category.”
Rocana’s inclusion in the round aligns with other investments the firm has made in next-generation beverages like Olipop and Recess. The investment is part of Rocanā’s Third Fund, RVP3, launched last year.
Guardiola is not shy about discussing the challenging “funding ecosystem that is not built for minorities and women” and believes that Bawi’s seed round can be an example to entrepreneurs who can’t seek startup capital from friends and family.
Previously unnamed investors in Bawi include Athletic Brewing founders Bill Shufelt and John Walker; Redbud Brands founder and managing partner Brian Goldberg; Manish Patel, former president of Nutrabolt Life Sciences; Michael Rypka, the founder of Torchy’s Tacos; and former PepsiCo CFO Bob Monza.
Guardiola has been formalizing his role as a mentor for minority and female entrepreneurs to serve a similar role that was provided to him by members of the Siete Foods’ Veronica Garza and the Athletic Brewing team in his early days launching Bawi. He sees mentorship as integral for leveling the playing field in CPG.
“The CPG industry, especially for cultural brands, is pretty difficult and can be a bit exploitative,” he said. “I don’t think a lot of people in the CPG industry want to talk about that.”