LIFEAID Beverage Co. announced this week that it has raised $20 million in an oversubscribed Series C financing round. The capital will go towards supporting the brand’s growth in retail in the U.S. and overseas, as well as funding new innovation and c-suite level hires.
The round included investments from existing investor Cambridge Companies SPG, who led the round, and KarpReilly, as well as new investment from Talisker Ventures, which focuses on high-growth brands and whose portfolio includes companies such as High Brew Coffee, Athletic Brewing Co. and Kettle & Fire.
Individual investors in the round included Lenny and Larry’s founder Barry Turner, Tilly’s founder Hezy Shaked, sports agent Shane Boras, former Cleveland Indians player Lonnie Chisenhall, hockey star Anze Kopitar, former Dallas Cowboys defensive end Tyrone Crawford, Green Bay Packers linebacker Preston Smith and Cincinnati Bengals star Larry Ogunjobi.
“We love having entrepreneurs and high level athletes at the table,” said co-founder and president Aaron Hinde. “We’re a performance energy brand and having these athletes that actually drink our product be part of our cap tables is a huge advantage.”
According to Hinde and co-founder and CEO Orion Melehan, the company had been preparing to begin fundraising in February 2020, but put its plans on hold after the onset of the pandemic after seeing many investors shift their focus away from growth plays and towards value investments. The funding round was previously announced as a $15 million round in June, but the company has since closed the financing with an additional $5 million.
Much of the financing will go into retail expansion. Hinde noted about 50% of sales come through ecommerce and the company still has only 50% ACV in grocery but barely 2% in convenience. In particular, the involvement of Larry Turner is expected to advise the company on the c-store channel and LIFEAID is now looking to develop specific SKUs that will potentially play well in the space. He said the company expects to add more c-stores in 2022 before kicking off a “major activation year” in 2023 .
Hinde noted that the brand’s FitAID and FocusAID products continue to play the “hero” role in the company’s portfolio and the brand will aim to innovate around those SKUs and build out larger lines from the products, including new flavors. Most recently, the company launched this summer a Strawberry Lemonade flavor for FitAID which quickly sold out online, Hinde said.
LIFEAID has also expanded its Go line of powdered drinks available in stick format, with the products now available in FitAID, ImmunityAID, FocusAID, PartyAID and DreamAID (promoting sleep) varieties. The sticks will also be expanding nationwide into about 5,000 CVS stores, Hinde said, with placement in the checkout line. Melehan noted the CVS expansion marks one of LIFEAID’s largest single store rollouts to date and the cash register placement is a first for the company, given its lack of front-of-house coolers. Although the RTD line “continues to be the lion’s share of the revenue” the company intends to focus on expanding Go in most channels, noting it is a strong trial driver for the brand.
“Not only is the [powdered] format on trend, that’s what younger consumers are looking for, but it gives us a way to build the brand at multiple points of distribution within the retail setting,” Melehan said. “At a lower price point it’s also a lower cost of entry for consumers into the brand. It’s relatively cheap to ship direct-to-consumer, so that line is just a great way to gain new consumer adoption and trial for the brand.”
To support expansion LIFEAID is hiring new sales and marketing team members, as well as retail sales analysts and additional finance personnel.
In June, the company hired former Lagunitas director of financial planning and analysis Nate Pearson as its first ever CFO. Pearson has also previously held senior finance roles at Tesla and cannabis products maker PLUS. Former 7-Eleven district sales manager John Wagner also joined the company in June as director of sales support. Hinde said Wagner is in particular focused on exploring opportunities for LIFEAID in the convenience channel.
The company is also continuing to focus on international expansion. Last year, LIFEAID fully purchased its overseas operations in Europe and Australia and is now working to expand head count and build out its presence in those markets via retail chains, independent stores and gym accounts. Despite headwinds from the Delta variant of the COVID-19 virus in certain markets — particularly Australia, Melehan said — the company is anticipating its European business to grow triple digits this year.