Yerba mate brand Clean Cause has converted $2.3 million to equity after raising the amount as a convertible note from previous investors last September.
The convertible note was part of the company’s plan to reach break even in 2025, which it did in February, according to CEO Todd Bondy.
“We needed a final push of working capital to fund some expansion and growth, and as a bridge to profitability,” Bondy told BevNET. “It wasn’t a big round for us because we just didn’t need a whole lot, which was a nice change to not have to raise a lot of money.”
Founded as a bottled water brand in 2015, Clean Cause has raised about $27.5 million over its ten years.
The funding helped Clean Cause build out inventory for two key launches this year. Over the summer, the brand entered Southeastern convenience chain Buc-ee’s. Additionally, Clean Cause launched a new Zero-Sugar Strawberry Lemonade mate variety that has rolled out in all Whole Foods store locations this month.
Clean Cause will be in about 11,000 retail doors by the end of the year with its portfolio of 13 SKUs. The caffeinated beverage has three main product lines: sparkling and non-carbonated yerba mate energy drinks in 16 oz. cans, and a Sparkling Pick-Me-Up line in 12 oz. slim cans.
Launched in 2023, Sparkling Pick-Me-Up “has a very loyal following” and gives the brand some equity in the functional set with its addition of collagen, prebiotics, and green tea-derived caffeine, Bondy said, but “it is more narrowly distributed compared to the yerba mate products.”
Now that the brand has been profitable for about eight months, it is planning its next frontier for expansion. It has “less than 2% ACV” in the c-store channel right now, so there is a “massive opportunity there to expand,” Bondy added.
Additionally, Clean Cause is under-indexed in volume-driven channels like mass and club, where it can sell bulk formats that have done well for the brand on Amazon and DTC.
Over the course of its decade in business, Clean Cause has seen interest in ready-to-drink yerba mate grow as Yerba Madre (formerly Guayaki) has expanded and more brands have entered the category. CLEAN Cause intends to put more dollars into marketing to stay ahead of the trend and prepare for a bump during “Messi Mania” at next year’s World Cup in North America.
“We’re in a position where future raises will be determined more by our growth plans,” Bondy said. “We’re sustainable right now, but we are really keen on growing faster and accelerating growth, so we’ll be exploring other opportunities to do that.”