O.N.E. Sells Majority Stake to Investors

In a move that demonstrates the ongoing jockeying for position taking place within the fast-growing coconut water category, PepsiCo and co-investor Catterton Partners have purchased a majoring stake in O.N.E. (One Natural Experience).

While O.N.E. founder and CEO Rodrigo Veloso will remain the chief executive of the company, the second round of investment from Catterton and PepsiCo will turn a majority of board seats over to strategic investors. As a result in the change in control, former O.N.E. executive and co-founder Emilie Frits Veloso will leave the board.

Rodrigo Veloso is expected to remain in charge of the company’s day-to-day operations as it becomes more closely aligned with PepsiCo’s strategic plans. O.N.E. had been receiving guidance and assistance from PepsiCo with regard to distribution and retailing strategy since last spring, when PepsiCo and Catterton purchased a minority stake in O.N.E. and the company became part of PepsiCo's entrepreneurially-focused "Learning Labs" program.

Since then, sales have grown  for the category, while the three largest companies operating within the coconut water space, O.N.E., ZICO and Vita Coco, have all scrambled to fulfill expanding demand from retailers. The three organizations have adopted slightly different marketing strategies as well: O.N.E. has broadened its brand platform to employ coconut water as a co-branded ingredient in a line of smoothies with Jamba Juice and has also rolled out functional line O.N.E. Active and O.N.E. Kids, a line of children’s products. Meanwhile, ZICO has begun putting its marketing efforts behind a PET plastic bottle line for its products, while Vita Coco has begun a national rollout via Dr Pepper Snapple Group-affiliated distributors.

The new round of investment — the second from PepsiCo and Catterton — followed several days of secret meetings with O.N.E. executives and their attorneys shortly before Thanksgiving. The move is expected to allow O.N.E. to operate more effectively on an international basis but its immediate domestic effect on PepsiCo’s coconut water efforts – the company has also been pushing a line of coconut waters under its Naked brand – have not yet become clear, although an announcement of the investment is expected in the near future.