Four Sigmatic may have helped set the table for the functional mushroom beverage boom, but it isn’t the only brand eating off it anymore.
When the Finland-born, Santa Monica, California-based brand first launched in 2012, the concept of adding functional mushrooms with funky names like Turkey’s Tail and cordyceps was about as cutting edge as it came.
Fast forward to 2021 and that’s hardly the case: from energy drinks (G.O.A.T. Fuel, Odyssey) to coffee (Califia Farms, Earth & Star) to a wide range of powdered products (Laird, Rritual, Marley One), mushrooms are arguably the hottest functional ingredient of the moment. That’s generally a good thing for Four Sigmatic, makers of all things mushroom, from infused coffee, protein, latte, elixir and cacao mixes to 2.5 oz. functional shots and skincare products. As of September, the brand is currently available in about 6,000 doors nationwide, including Whole Foods, Sprouts, Wegmans, HEB, King Soopers and Fred Meyer.
But where function had previously been the focus, the proliferation of the functional mushroom category — rising to $7.98 billion in 2020, according to Allied Market Research — means Four Sigmatic is making a slight pivot in messaging with its latest release. The company this week launched a line of coconut-based powder creamers available in three varieties: Think (Cacao Coconut with Lion’s Mane and MCT Oil), Gut Health (Vanilla Coconut with Probiotics and MCT Oil) and Balance (Original Coconut with Ashwagandha and MCT Oil).
“The original users of Four Sigmatic and many other functional foods were less obsessed with flavor and more obsessed with functionality,” said founder and CEO Tero Isokauppila. “And now while functionality matters, flavor and user experience have become bigger factors.”
A natural category extension for both the brands and functional mushroom products overall, Four Sigmatic’s creamers had been in development for seven years, according to Isokauppila. And though challenges like securing organic ingredients had to be surmounted before launching the product, the long gestation period was at least in part by design.
Creamers are not typically a “hotbed of innovation,” he noted, and demand amongst Four Sigmatic fans who were already getting their dose of mushrooms from the coffee was understandably low. Experienced users, for example, can pair the Think Functional Creamer with Think Functional Coffee for an “extra boost.” But for new consumers still unfamiliar with the ingredient, the idea is to create a natural entry point where they can begin to integrate functional mushrooms into their daily habits.
“I bet a lot of our existing consumers will love this product, but more importantly this product is for the consumer who we want to talk to — a busy mom, or a baby boomer who wants to be healthier,” said Isokauppila. “This is the audience we are really making this for: one that is busy, who wants to be healthier and cleaner, but for whom flavor and convenience matter.”
With that in mind, Four Sigmatic is looking for ways to keep its existing consumers engaged while laying the groundwork for newcomers to easily get onboard. The brand’s original adopters, some of whom are vocal digital influencers, tend to bring a degree of knowledge on the ingredients, with a focus on proper sourcing and dosage. In contrast, capturing the next generation of functional mushroom fans means doing things like spending the extra money to buy real vanilla and creating a color-coded packaging design that helps steer users to different use occasions and day parts.
With wind in its sails, Four Sigmatic’s next challenge is in finding the balance between embracing innovation and maintaining patient growth. While acknowledging that liquid creamers represent a “massive opportunity” for the brand, Isokauppila noted that “it’s not a market where first mover advantage will win.”
The data seems to back that up: according to Technavio, the global coffee creamer market is set to accelerate at a CAGR of 4.31%, with North American providing 32% of overall growth. With that in mind, the brand is looking for similar categories in which it can exploit existing synergies and develop complementary products that can “support the user experience and functional properties” of other Four Sigmatic offerings, or that can be seamlessly integrated into users’ existing routines, like coffee.
With more than 12 new products slated to launch in 2022, the brand has plenty of innovation coming down the pipeline — making each decision more delicate and deliberate.
“We’re trying to be more disciplined about which products we launch, whereas before when we were one of the few players in the space, we could go a little bit wherever we want,” he said. “We’re not in a vacuum anymore. We have to be super disciplined and patient on where we go and to go aggressively.”