Gathered Foods Reels in over $20M More, Will Expand Services
Gathered Foods, the makers of Good Catch vegan seafood, announced in January that the alternative protein play had raised a series B round of $32.3 million, $10 million of which was closed last year as a convertible note. The capital will be used to bring a new production facility online, which, in turn, will allow for international expansion of the Good Catch brand, food service opportunities and the opening of co-packing and R&D facilities for other food brands.
The raise was led by Stray Dog Capital and Rocana Ventures, with strategics 301 Inc (the venture arm of General Mills) and Greenleaf Foods (the plant-focused subsidiary of meat producer Maple Leaf Foods) taking part alongside impact investors, including Almanac Investments, CPT Capital and New Crop Capital.
Chris Kerr, who is Gathered Foods’ CEO as well as New Crop Capital’s chief investment officer, said that the funding round closed in waves: $10 million last July, another $12 million last fall, and, most recently, investment by Greenleaf and 301. Greenleaf Foods previously acquired vegan brands Lightlife and Field Roast, while 301 has also invested in plant-focused companies including Beyond Meat, Urban Remedy, Kite Hill, No Cow, Farmhouse Culture and Rhythm Superfoods.
Gathered Foods’ soon-to-open 42,000 square foot plant is the key to the company’s projected growth Kerr shared. The Ohio-based facility, which is located in a former corn field, should come online in the Spring, setting off a domino effect of benefits. Most immediately, all production will shift from the U.K. to the U.S. and Good Catch will be able to drop prices on existing products by at least $1 thanks to efficiencies of scale. Alongside this, the brand will launch new products (including its long awaited frozen line) and expand into other geographic markets, including the U.K., Europe and Asia.
Chocolate Fix: Little Secrets to Expand Offerings
Confection brand Little Secrets is ready to give consumers their chocolate fix — while also fixing conventional candy offerings. The brand launched a line of Cookie Bars (a Twix Bar alternative), a new almond butter flavor of its Crispy Wafers (which are similar to Kit Kats) and multipack bags of mini Crispy Wafers.
The brand started in 2014 with a line of Chocolate Pieces (similar to M&Ms) but really began to gain traction — and double sales — when it launched the Crispy Wafers line last spring. According to founder Chris Mears, the confection shopper craves novelty and variation.
The new products will launch into 1,500 stores including Whole Foods Market, Sprouts, Natural Grocers, Fresh Market, Earth Fare, Fresh Thyme and Central Market. In recent years, Mears said, the company decided that focusing on the natural channel is most effective. The natural chocolate confection category is worth $550 million, he added, with roughly a third of those sales coming from Whole Foods (at approximately 500 stores), another third from specialty and natural retailers and the final third from conventional retailers — where Little Secrets would have to compete with the likes of Hershey’s and Ferrero.
“Seventy percent of our business is across 2,000 doors of the pie. Otherwise you’re chasing 25,000 doors for the other thirty percent of the pie,” Mears explained “In the natural channel, you can get front register placement and on display. This is a category where 70% of purchases are driven by impulse.”
PepsiCo Acquires PopCorners Maker to Expand Portfolio of Healthy Options
In December, PepsiCo announced its intention to acquire better-for-you snack producer and co-packer BFY Brands, the maker of PopCorners snacks, from private equity firm Permira. Upon closing, BFY will be rolled into PepsiCo’s Frito-Lay North America division. Financial terms of the deal were not disclosed.
In a release, the company noted that BFY’s production facilities will remain in Middletown, New York, and Liberty, New York and that current CEO Paul Nardone and President and Chief Commercial Officer Dan Morgan expect to remain on with the brand to help “continue its current expansion plans.” The company currently has 750 employees.
The deal, PepsiCo stated in an announcement, will further expand the global brand’s portfolio of better-for-you snacks — which already includes Smartfood popcorn, Sun Chips, Off the Eaten Path vegetable puffs (which are manufactured at BFY’s facilities), Imagine yogurt crisps and bare fruit and vegetable crisps. Within that group, Bare was the company’s most recent acquisition, in May 2018.
BFY brands was formed in 2015 when Permira acquired both Medora Snacks, LLC, producer of PopCorners, and Ideal Snacks Holding Corporation, a leading contract manufacturer specializing in popped snacks. Permira then brought in Nardone, who previously served as the CEO of Immaculate Baking Company, Stirrings and Annie’s Homegrown. Since the acquisition, the company has doubled its workforce, and is sold in over 40 countries and territories around the world.