Koia Lands Potential “Last Money” With CircleUp Investment
Plant-based beverage brand Koia has completed a bridge funding round with investment platform CircleUp Growth Partners that could possibly represent “the last money into the company,” according to CEO Chris Hunter. Details of the transaction were not disclosed.
Koia has been one of the standout performers among an emergent class of plant-based protein drinks; according to IRI data, sales of its core lineup are up 123.5% ($7.6 million) year-over-year through February 23. Sold refrigerated in 12 oz. PET bottles, the brand has since expanded to include other functional sub-lines, including keto and coffee, which launched exclusively at Whole Foods in January. Two new flavors, Protein Chocolate Peanut Butter and Keto Cookies ’n Cream, debuted last month.
Koia joins a food and beverage portfolio at CircleUp that includes plant-based brands such as Nutpods, Barnana and Rhythm Superfoods. The company will not take a seat on the board. The San Francisco-based firm launched a $125 million venture capital fund in 2017 which uses its proprietary AI platform Helio to guide investment strategy.
Koia CEO Chris Hunter said the company has kept an ongoing dialogue with CircleUp since around the time it entered the market in 2016; in a confirmation of the brand’s mission to connect with mainstream consumers, Hunter noted how CircleUp shared data from Helio showing Koia’s broad appeal. He praised the group for being “very, very patient” as he initially explored raising an internal round of bridge capital before eventually deciding to bring them on as a full partner.
The company’s original plan, according to Hunter, was to “go out for a much larger round” to close in late Q2 or early Q3 that would be “the last money in to our company.” Yet despite taking a bridge round, Koia is still on track to both hit its targets and retain the flexibility to either pursue a future sale, further equity investment, or other outcomes, Hunter said.
“We are actually in a position now where we will have a positive cash position through the end of the year and into early next year,” he said. “The reason why that’s important to us is because we expect some pretty big margin enhancement and being even potentially at break-even by the end of the year, so that could have theoretically been the last money into the company.”
The new funding will go towards supporting retail execution and saturating existing channels, with Hunter noting the company is eager to apply learnings from successful launches at conventional grocers Albertsons/Safeway and Publix. The latter, the first conventional outlet to stock Koia, now counts the core protein line as a top-10 best-selling refrigerated beverage, he said. Though in-store demos and activations are on-hold for the foreseeable future, the company has not made any staff cuts related to the COVID-19 outbreak as of April.
Jennifer Cue Steps Down as Jones Soda CEO
Jones Soda Co. CEO Jennifer Cue has stepped down from her position, the company announced on April 7. Jamie Colbourne has been named interim CEO.
Cue, who was appointed CEO in 2012, is the company’s second largest shareholder after cannabis investment firm SOL Global purchased a 9.8% stake last year. She will remain on the company’s board of directors.
“I would also like to thank Jennifer Cue for her many years of service and dedication to Jones Soda,” said Michael Fleming, Jones Soda’s chairman of the board, in the release. “Her leadership played an integral role in evolving Jones and Lemoncocco into authentic and unique brands that resonate well with consumers.”
Cue originally joined Seattle-based Jones Soda in 1995 and spent a decade at the company in various roles, including COO and CFO, before departing in 2005. She rejoined the company as CEO in 2012.
Cue told BevNET she was enthusiastic about bringing in an experienced “fresh pair of eyes” in Colbourne to run the business.
“We had a couple of challenging years, and I had the opportunity to meet Jamie, who is fantastic,” she said. “I’m going to be working hand-in-hand with him to assist through the process. I’m still very involved in wanting to see the success of this business.”
Colbourne is a Seattle-based CPG executive with a broad range of food and beverage experience, having most recently served as CEO at holding company JGC Foods. His prior roles include CFO at Quaker Oats (PepsiCo), CEO and President of Tully’s Coffee and CEO at Harry’s Fresh Foods. He is also a member of the board at Ellenos Real Greek Yogurt, Bargreen Ellison and Harbor Wholesale Foods.
“Jones Soda presents an exciting opportunity to significantly grow a brand that has developed a reputation for unique and great tasting craft soda within its current customer base,” he said in the release. “I look forward to leveraging my expertise in growing CPG and food distribution companies as we implement the necessary strategies to execute on the Company’s initiatives and return Jones to profitable growth.”
Court Approves Sale of Dean Foods Assets, Including $433M DFA Deal
In late March, a U.S. bankruptcy court approved the sale of all assets of dairy conglomerate Dean Foods, including a $433 million acquisition of properties by national cooperative Dairy Farmers of America (DFA). The decision comes roughly five months after Dean, at the time the largest dairy producer in the country, filed for Chapter 11 bankruptcy protection.
In February, DFA announced it had reached an agreement to acquire a substantial portion of Dean’s assets, including 44 of its 57 liquid and frozen facilities, real estate, inventory, equipment, parts of its direct store delivery system and other corporate assets, for a base sum of $425 million. However, the cooperative was dropped as the stalking horse bidder for Dean last month after a group of creditors filed opposition in court against the deal.
In a statement sent to BevNET, DFA EVP and chief of staff Monica Massey said that the approval of the cooperative’s bid followed “many months of uncertainty regarding the future of Dean Foods” and that the final closing is contingent upon approval by the U.S. Department of Justice and the finalization of collective bargaining agreements with multiple unions.
“Throughout this process, our main focus has always been, and continues to be, on maintaining milk markets and limiting disruption to the industry,” Massey said. “If approved, the purchase of these assets will be critical to our mission of delivering value to our family farm-owners, preserve nearly 12,000 jobs and ensure fresh dairy is available to consumers across the country.”
In addition to the DFA agreement, the court also approved the sales of eight facilities and two distribution branches to Prairie Farms Dairy for $75 million and a facility in Miami, Florida to Mana Saves McArthur, LLC for $16.5 million. California-based Producers Dairy Foods was approved to purchase Dean’s Reno, Nevada facility for $3.7 million as well as the intellectual property rights to the Berkeley Farms brand for $3 million. Texas-based Industrial Realty Group, LLC was granted the right to acquire Dean’s Meadow Gold Hawaii business — which produces brands such as TruMoo, Dairy Pure and POG juice in the Aloha State — for $25.5 million.
As well, juice brand Uncle Matt’s Organics, which Dean acquired for an undisclosed sum in 2017, will be sold to Harmoni, Inc. for $7.25 million. According to IRI, the brand’s orange juice business reported over $12 million in retail dollar sales for the 52-week period ending February 23, up 31.6%, making it one of only a handful of orange juice brands showing double digit growth. Its lemonade business reported an additional $2.7 million in dollar sales in the same period.
“We are confident that, under these new owners, our customers can expect the same commitment to quality and service that Dean Foods has lived up to over the years,” said Dean Foods president and CEO Eric Beringause in a press release. “We will continue to provide an uninterrupted supply of high-quality dairy products as we work towards completing these transactions. We appreciate the continued hard work and commitment of our Dean Foods employees throughout this process.”