New Fund: Almanac Investments Launches
David Barber, co-owner of restaurants Blue Hill and Blue Hill at Stone Barns, has launched Almanac Investments, a $30 million fund for agriculture and hospitality technology, CPG, and experiential retail companies. Typically, Almanac will invest in seed or series A rounds for early stage brands and has already closed three investments.
Joining Barber is Zoe Feldman, who will serve as managing director of the fund. Both Barber and Feldman have experience in the investment world. Barber, an angel investor himself, is an advisor to venture fund S2G Ventures and Acre Investments, whose sole limited partner is The Campbell’s Soup Company, while Feldman, a former PepsiCo executive, most recently was the managing director for Cleveland Avenue’s fund.
Almanac hopes to set itself apart from other funds by developing a deep pool of resources – in data, marketing, public relations, accounting, supply chain, operations and more – that not only will assist with vetting prospective investments but then can be hired by companies once they are part of the Almanac portfolio. Barber hopes that assembling this team will help create a more unified support system for the entrepreneur.
“I found it shocking that [service providers] don’t talk to each other that much about the companies that they are simultaneously working on. They are working adjacently but they aren’t actually collaborating. So our idea is to get them collaborating on our behalf,” Barber said. “It’s a huge value add to the entrepreneur.”
Too often, Feldman said, small brands have to choose between initiatives due to a lack of capital. For example, having to choose between buying data and hiring a bookkeeper, or designing sales strategy and finding a great communications firm. “What we’re doing is eliminating the barriers for them to both find and afford these resources,” Feldman added.
Although Almanac is not an impact investing or evergreen fund and will only invest in companies where they expect to see a return on investment, Barber does plan for these investments to take longer to come to fruition. As a result, Almanac plans to only invest in one to two companies per year and at any one time, and expects to have up to six brands in the portfolio that require more hands-on attention and operational support.
This “long tail” capital, Barber believes, will allow Almanac to have a deeper relationship with its portfolio companies and more time for its team of resources to assist brands.
“We want to help businesses build a strong foundation in this ecosystem,” Barber said. “We think those have both the best chance of surviving no matter what and I think they are the ones that are going to contribute the most in the long term.”
Barber told NOSH that the capital for the fund was raised from individual investors and although there were offers from strategics, he felt the goals of the fund were not conducive to the ways large strategics view deploying capital. All of the individuals invested in the fund, Barber said, are interested in building a “healthy food ecosystem” and next generation companies.
Lactalis Buys Siggi’s
Icelandic-style yogurt producer Siggi’s sold to global dairy company Lactalis in January. The company will continue to operate out of its New York City office with founder Siggi Hilmarsson as CEO and Bart Adlam as President.
Siggi’s says its products, known as “skyr,” comprise the fastest growing yogurt in conventional grocery. J.P. Morgan Securities acted as the exclusive financial advisor while The Giannuzzi Group acted as legal counsel to siggi’s.
The deal will allow the brand to continue to expand while maintaining its quality standards, Hilmarsson said.
“We will just be supported even further by Lactalis, which has vast expertise in dairy operations and that knowledge will just help further enable our growth,” he told NOSH, adding that the opportunity to partner with Lactalis “[will} enable siggi’s to continue to operate independently and keep our great team in place while tapping into the dairy expertise of the biggest dairy company in the world.”
The deal was the second major dairy acquisition for Lactalis – which had previously had little business in the U.S. – in less than a year. In July, 2017, the company purchased organic yogurt pioneer Stonyfield Farm from Danone for $875 million, a deal forced by Danone’s own purchase of White Wave. Between the two brands, Lactalis now owns two of the top players in the premium, natural yogurt set.
As part of the deal, Lactalis picked up dairy conglomerate Emmi’s 22 percent ownership stake in siggi’s. the skyr business.
Reports have pegged siggi’s 2018 sales at roughly $200 million. Hilmarsson told NOSH that siggi’s topline grew 50 percent in 2017 and he expects the company will match this growth in 2018 as the brand launches additional innovations.The company’s low-fat, high-fat, drinkable, and children’s yogurts are sold nationwide in retailers including Whole Foods, Publix, Target, Wegmans and Starbucks.
$55 Million for Beyond Meat
Plant-protein powerhouse Beyond Meat announced the close of a $55 million round in December. Leading the round was Cleveland Avenue, LLC, the venture capital firm founded by Don Thompson, former CEO of McDonald’s Corporation.
“We see Beyond Meat as a strategic and compelling consumer-focused investment,” Thompson said in a statement. “Customer response to Beyond Meat’s great-tasting products has driven its growth, and we’re excited about our investment as the brand continues to innovate for the future.”
Tyson Foods, one of the largest meat providers, also contributed to the round. In October 2016, the large strategic made its first investment in Beyond Meat, acquiring a five percent stake in the company for an undisclosed amount. While terms of this latest raise were not disclosed,Tyson noted in a statement that its “latest investment slightly increases its ownership stake in Beyond Meat from the five percent established a year ago.” Beyond Meat also raised an undisclosed sum from actor Leonardo DiCaprio roughly two months ago.
The capital will be used to more than triple Beyond Meat’s production footprint – a move that follows the September opening of fellow plant-based burger brand Impossible Foods’ new 68,000 square-foot Oakland, California-based facility. The competitor has also seen capital recent months, closing a $75 million round of funding in August 2017.
Both Impossible Foods and Beyond Meat often share the spotlight for their meat-like burger patties, which are designed to closely resemble the taste, texture and look of a beef-based burger. For both companies, the goal is to focus less on the vegan consumer and more on meat eaters looking to incorporate more plant-based options into their diets.
However the two have utilized different distribution strategies thus far, with Impossible Foods remaining focused on food service distribution. Beyond Meat first launched as a Whole Foods Market exclusive, but has quickly grown to be sold in over 5,000 stores nationwide. Since then, the company has also embraced food service as well. In recent months, the company explored a soft launch in restaurant TGI Fridays, and is expected to roll out across the chain’s 469 restaurants in 2018.
In a statement, Beyond Meat also noted the capital will be used to further fund its R&D work, and expand sales and distribution. The latter will be key in fending off other plant-based players, who increasing are drawing the attention – and capital – of large corporations.
Earlier in December, Field Roast Grain Meat Co., which produces vegan meat and dairy alternatives, was acquired by major meat producer Maple Leaf Farms; also in 2017, Nestle Foods acquired Sweet Earth. These transactions have occurred as classic brands realize they need to partner with plant-based companies rather than risk losing share to them.
“Global demand for all protein remains high and we’re passionate about meeting that demand sustainably,” Justin Whitmore, executive vice president corporate strategy and chief sustainability officer of Tyson Foods, said in a statement about the acquisition. “Our investment in Beyond Meat provides another fantastic alternative for consumers as we strive to sustainably feed the world.”
Shoppers Looking Online to Save Money
More than 25 percent of shoppers are regularly buying their groceries online – and while convenience is playing a role, it’s not the whole story.
A new survey from consumer insights group IRI found that shoppers are looking online in efforts to be mindful about their spending on everything from personal care to groceries. When it comes to stocking their fridges, 28 percent of consumers said they buy grocery items online compared with 23 percent of consumers surveyed during the same time frame in 2016.
While shopping online may have more administrative costs, consumers felt that they ultimately saved money. Customers who shopped online for food and groceries noted that one of their main motivations was to cut down on impulse purchases at the store. Overall, 51 percent of total shoppers felt they make fewer unplanned purchases online. IRI also found that 20 percent of consumers expressed it was easier to find the grocery items on their lists online rather than by walking through store aisles.
Price is another contributor for customers to shop online, according to surveyed shoppers. Almost a quarter of all millennials, gen x’ers and baby boomers are shopping for food and beverages online in the hopes of saving cash. Respondents said that shopping online provides them an easier way to access discount code and coupons, as well as a more efficient way to compare prices between retailers. In fact, the report found over half of consumers in 2018 are expected to download coupons from retailer or manufacturer websites, as well as compare prices on retailer websites.
“While consumer confidence [in the economy] has improved during the last few years, consumers can still be a bit shaky about their job and financial prospects, so we’re seeing some mixed signals in our survey results,” Susan Viamari, VP of Thought Leadership for IRI, said in a statement. “Many, especially younger consumers, say they think the internet provides money-saving opportunities, so we wanted to dig further and find out what role online shopping is playing in consumers’ CPG spending.”
Though consumers are unlikely to do all of their CPG shopping online, IRI found that 76 percent of all shopping trips began online and 50 percent of CPG category growth is predicted to be online in 2018. To cash in on this growth, retailers are trying to provide shoppers with a variety of options to best fit their online shopping needs.
Of all the shoppers, 55 percent of millennials, 52 percent of Generation X, 36 percent of baby boomers and 25 percent of seniors said they like click-and-collect options. Just under a quarter of all consumers said they regularly prefer home delivery for their online grocery shopping. Subscription services for grocery purchases are less popular however, with only 12 percent of customers expected to regularly do so in the new year.
Retailers and brands have already started to adjust their business strategies to accomodate consumers who are buying items with a click of a button on their computers or phones. After After acquiring Whole Foods, Amazon has begun to explore synergies between the businesses, most recently launching free same-day shipping on thousands of products, including many sold in Whole Foods. Wal-Mart also announced last week that it would convert 12 of its Sam’s Club locations to ecommerce fulfillment centers, while Target recently acquired Shipt, Inc., an online same-day delivery platform.
“When consumers think about online CPG shopping, they have specific ideas about what is helpful in their lives,” Viamari said. “There really is no one-size-fits-all answer, so it’s critical to understand what it is that makes your key shoppers tick.”