19 December 2022
Poppi raises; Trident sold; Weber goes private; Trü Frü, Topo acquired
On this week's Dealboard, check out new investment for video shopping, footwear prototyping and headless commerce.
On this week's Dealboard, check out new investment for video shopping, footwear prototyping and headless commerce.
Welcome to Dealboard. In this weekly feature, The Current is providing a look at the mergers, acquisitions and venture capital deals making waves in ecommerce, CPG and retail.
This week, there’s new investment for top brands in functional soda, plus-size apparel and skincare. Plus, Mondelez is divesting well-known brands, Weber is going private and DSW is adding to its portfolio.
Take a look at the latest activity:
Silverwood Brands acquired a 19.8% stake in UK-based cosmetics and skincare retailer Lush for 216.8 million pounds.
Lush, which operates in 48 countries, will use the investment to expand into other sectors, including health and beauty and specialty foods. The deal comes after Lush acquired its North American business partner last year.
Silverwood also acquired Japan-based skincare business Sonatas for 18 million pounds.
Digitally native plus-size women’s apparel brand BloomChic received an investment from consumer-focused investment firm L Catterton.
Serving women sizes 10-30, BloomChic aims to help women easily find clothes that fit. The brand shares that approximately two-thirds of American women wear clothes sized 14 and above. However, these sizes make up less than half of the US women's apparel market.
Here’s how the brand describes its product development process:
Focusing on customer satisfaction and efficiency, BloomChic employs a data-driven product development process which identifies trending colors, patterns, and fabrics with consideration for different body shapes and each material's properties. New offerings are produced and tested in very small batches, leveraging the founding team's decades of production and inventory management experience as well as its extensive and deep relationships with top suppliers.
With the deal, L Catterton will offer consumer insights and operating capabilities.
"BloomChic puts its customers at the center of everything it does," said Scott Chen, a Managing Partner of L Catterton, in a statement. "This is evident not only from the range and quality of its products, but also the meaningful connections it has formed with customers and its culture of ensuring that the plus-size voice is heard.”
Poppi. (Courtesy image)
Poppi, the prebiotic soda brand, raised $25 million from CAVU Consumer Partners.
It comes in a year when the brand saw a 148% increase in overall revenue and a 250% increase in online sales. It also vaulted to become a top-10 brand during Amazon’s Prime Early Access Sale. It has also doubled its retail presence, and is now in 20,000 doors.
Poppi started as a farmers market favorite. Then, cofounders Allison and Stephen Ellsworth appeared on Shark Tank in 2018. With the funding, Poppi plans to grow its retail presence, invest in larger-scale media and further product development.
iNNBeauty Project products. (Courtesy photo)
iNNBeauty Project, a clean skincare brand, raised $12 million in a Series B funding round.
The financing was led by consumer investor Alliance Consumer Growth, with participation from Strand Equity and Beechwood Capital.
Launched by Alisa Metzger and Jen Shane in 2019, the brand is distributed online and in-store through Sephora. Following the funding, it plans to continue expanding this partnership, develop new products and hire to grow its team.
“Seeing our iconic products like Green Machine & Pimple Paste continue to engage new users in-store and on digital platforms is so rewarding as we look toward the new year,” said Metzger, in a statement.
With the funding, the brand will seek to continue growth, including an expansion with Sephora.
Heyday, a skincare company, raised $12 million in a Series B extension led by existing investor Level 5 Capital Partners. The company previously raised $20 million in a Series B round in 2020.
Heyday offers skincare services such as facials at more than 10 shops in New York, LA and Philadelphia. In 2023, it is planning to open over 30 shops, in part through a franchise model that will help it expand to Denver, Boston, Austin and Phoenix. The company is also planning to launch a line of skincare products. Additional funds will be allocated toward tech advancements, product development and growing the team.
Omar Bailey and Abhishek Som. (Courtesy photo)
FCTRY LAb, a footwear prototyping lab and venture studio founded by former Yeezy-Adidas innovation lab head Omar Bailey, raised $6 million in its initial investment round.
Bailey teamed with former private equity executive Abhishek Som to create a US-based innovation studio that aims to cut product development times when compared with those of overseas supply chains. Based in LA, the lab will harness technology such as additive manufacturing & 3D printing for use in footwear.
Here’s how a release describes the participating investors:
This initial $6 Million tranche included a diverse group of venture capital firms, top professional athletes and a myriad of pedigreed angel investors. Investors include the Co-Founder of Tinder (via Time Zero Capital), Co-Founder of WeWork, the West Coast Head of Warburg Pincus, and a consortium of NBA & NFL stars via Chicago based Aurelien Capital. Venture capital investment was led by the LA-based, Pay-Pal-backed Slauson & Co, with additional investment from Relay Ventures, Elysian Park Ventures (the private investment arm of the Los Angeles Dodgers ownership group), Level One Fund & Fog City Capital among others.
(Photo courtesy of Trendio)
Trendio, a video shopping app for beauty, raised $3 million in a funding round led by Madrona.
The startup was founded by former Amazon VP of US Prime Video and CVS head of beauty Alex Perez-Tenessa and David Olmos. They are joined by Amazon Live alum Julie Novak and former Glossier head of make-up category management Leah Grubb.
Powered by video AI, the app allows users to interact with creators through video, pin their favorite products to their dashboard and purchase items from a variety of brands directly through Trendio. The app is available on mobile devices through iOS and Android, as well as via connected TV on Roku. Brands available on the app include Merit, Philosophy, Fig1, Ursa Major, Nudestix, Kjaer Weis, Joanna Vargas, Coola and Avene.
"We launched Trendio because traditional ecommerce wasn't working for customers who wanted to discover new beauty brands and products in a way that felt personal and that they could trust,” said Perez-Tenessa, in a statement. “Our technology roadmap not only enhances the shopping journey, it reinvents how people experience video altogether - we are creating the first ever personalized video experience."
Pack, a platform for headless ecommerce raised $3 million in a second seed round.
The round was led by Norwest Venture Partners, with participation from Vanterra Ventures and existing investor Alpaca.
Following the funding round, the company plans to continue developing the product, add partnerships beyond the Shopify ecosystem and increase go-to-market efforts.
“More than the money, the funding is further validation from investors that the hard work and late nights we put in bootstrapping our way through our first three years to build the platform we have today was the right decision,” wrote CEO Cory Cummings, in a blog post.
ProfitWheel, a SaaS platform for consumer intelligence, raised $1.2 million in a pre-Series A round according to a news release.
Investors in the round include Eightfold AI CEO Ashutosh Garg, former head of Google Search
Amit Singhal and Nigel Morris, former Chief Strategy and Innovation Officer and CEO Americas and EMEA of Dentsu International. The SAFe note round values the company at $30 million. It follows a $3 million seed round raised last year.
Founded by a team of former leaders from Dentsu and Nielsen, ProfitWheel says it balances user privacy with providing brands and retailers with the ability to derive analysis from first and third-party data.
“Digital marketing is constantly disrupted by ever-changing systemic changes and privacy concerns – creating lesser audience transparency,” said CEO Gautam Mehra, in a statement. “ProfitWheel was established to empower marketers with more intelligence to help them navigate these changes and have better consumer understanding to steer their businesses.”
Mondelēz International announced plans on Monday to sell its gum business to Mentos maker Perfetti Van Melle Group. The deal is valued at $1.35 billion, which Mondelēz said is 15x estimated current year EBITDA.
The business, which spans the US, Canada and Europe, includes brands such as Trident, Dentyne, Stimorol, Hollywood, V6, Chiclets, Bubbaloo and Bubblicious.
In a statement, Mondelēz CEO Dirk Van de Put said the company "is pleased to transition our developed market gum business to a values-led, family-owned company whose portfolio is a strategic fit, and where our brands and people can thrive.”
Oreo and Ritz maker Mondelēz has been reshaping its portfolio to focus on chocolate, biscuits and baked snacks. Earlier this year, it made headlines with the acquisition of Clif Bar and Mexican confectionery company Ricolino.
Weber, the grill brand, will be taken private in a merger with investment firm BDT Capital Partners.
With the deal, Weber receive a $350 million loan that will be used to repay existing debts, invest in new product initiatives, and fund working capital for the upcoming 2023 outdoor cooking season.
BDT will purchase all outstanding Class A shares of Weber that it does not own for $8.05 per share, which is a 60% premium. This values Weber at $3.7 billion.
The deal is expected to close in the first half of 2023.
Designer Brands, Inc., which is the parent of DSW Warehouse, is set to acquire Topo Athletic in a deal that will help it expand in the athletic and outdoor footwear category.
Founded by former Rockport exec Tony Post in 2012, Topo makes footwear for running, walking and hiking. It joins a growing portfolio of DSW’s Owned Brands, which are sold at its stores alongside other brands. Sales grew 25% in this category in the third quarter, and DSW aims to double sales of these brands by 2026.
Post will remain with Topo following the acquisition.
Mars Inc. acquired Trü Frü, a better-for-you, whole fruit snacking brand.
Founded in 2017 by CEO Chief Brian Neville, President Taz Murray, and COO Brandon O'Brien, Trü Frü brings together natural fruit and chocolate. At Mars, it will join a portfolio of health and wellness-focused snack brands that includes KIND and Nature’s Bakery.
“Trü Frü is a perfect complementary fit for our health & wellness portfolio and our capabilities will help the brand strengthen its operations, broaden distribution and accelerate growth,” said Andrew Clarke, global president of Mars Snacking, in a statement.
Crisco and Cream of Wheat maker B&G Foods announced plans to divest health store snacking staple Back to Nature. Barilla Group, which is known for pasta, will buy the brand.
"Our decision to sell Back to Nature is part of a broader effort at B&G Foods to focus our portfolio on businesses that are core to our long-term strategy as we transition to a business unit structure,” said Casey Keller, President and Chief Executive Officer of B&G Foods. “The divestiture will also allow us to reduce long-term debt, while providing Barilla America with a great brand.”
For its part, Barilla is aiming to build a multi-brand bakery platform.
“We focus all our business activities and products on health and indulgence and hence Back to Nature was a natural choice," said Barilla CEO Guido Barilla.
B&G previously acquired Back to Nature from Mondelez International in 2017. The brand makes cookies, crackers, granola, nuts and trail mix.
The deal with Barilla is expected to close in the first quarter of 2023.
Plant therapeutic brand Prima acquired hemp and hemp brand Prospect Farms. The brands are joining together to form Uplifter Brands, which is described as a next-gen CPG house for clean and conscious brands across personal care, supplements, spa and hospitality, private label and pet wellness.
With the deal, Prima will own the eponymous Prospect Farms, which has over 250 acres of hemp cultivation and manufacturing facilities including a greenhouse, filing system, and on-site lab formulation and fulfillment. Uplifter Brands will be led by former Prima CEO Laurel Angelica Myers and former Prospect Farms CEO Brad Tipper as co-CEOs. Honest Company Founder Christopher Gavigan is serving as executive chairman.
"At a time when many of our competitors are shutting down, consolidating, or moving away from cannabinoids all-together, we're doubling down on the ingredient and its vast therapeutic benefits," said Myers, in a statement. "With the acquisition of a USDA Certified Organic hemp farm and an even bigger plan to lead the wellness category with the cleanest, science-backed botanical therapeutic products, we can't wait to share what's coming next."
Personal care multinational Beiersdorf acquired S-Biomedic, a life science company specializing in skin microbiome research. Beiersdorf had previously invested in S-Biomedic in 2018, and is now acquiring a majority stake. S-Biomedic will continue as a standalone company.
Founded by Veronika Oudova and Bernhard Paetzold in 2014, S-Biomedic research and develops ingredients for cosmetics that use living skin bacteria.
The North Face and Vans owner VF Corp. is mulling the sale of backpack brand JanSport, Bloomberg reported Monday. Such a deal could value JanSport at $500 million, but no final decision has been reached. The news comes after CEO Steve Rendle announced his retirement from the company.
Ask Instacart answers prompts with personalized recommendations.
A pair of recent launches from Instacart highlight how the grocery ecommerce company is integrating two of the key emerging areas of technology into its offerings: Generative AI and marketplaces.
Let’s take a look:
Instacart is seeking to harness generative AI to create a more personalized shopping experience.
A new tool called Ask Instacart that is launching this week is designed to allow customers to type in questions about specific recipes or general recommendations for an occasion. Embedded in the search bar, Ask Instacart also provides personalized questions to be asked by customers. In addition to specific items, it provides information about food preparation, product attributes and dietary considerations.
For those eying how generative AI will play a role in the shopping experience, Ask Instacart shows how search can be transformed into a place for discovery. Instacart is aiming to provide answers to the more open-ended questions that people would naturally ask, not just simply provide info in response to a question that has one answer. It shared the following sample prompts:
The tool is also showing the way for generative AI to integrate with retail media. Ask Instacart is designed to integrate with a brand's sponsored products campaign, so that the answers to questions that match consumer needs can also provide a way for brands to stand out.
To create the tool, Instacart combined the language understanding of ChatGPT with its own AI models. It added in catalog data from 80,000 retail partner locations around the country, which together have more than one billion shoppable items.
Beyond mission: Ecommerce marketplaces have honed a shopping experience where it’s easy to find what you’re looking for. But if shoppers want to happen upon something they didn’t know they needed, social media or the store is still the best place to visit. Instacart is showing how generative AI can make discovery a marketplace function. It also signals that advertising will come to generative AI by way of retail media. Going forward, the growth of discovery could make retail media more valuable as a tool for advertising that raises brand awareness, not just lower-funnel conversions.
Instacart will power a new virtual convenience store for the grocery chain Aldi.
Aldi Express will feature 2,000 of the most-shopped Aldi items, ranging from prepared food and snacks to grocery staples.
Drawing on 2,100 Aldi locations around the country, items will be delivered as fast as 30 minutes, the companies said.
“Through ALDI Express, we’re making shopping more convenient so you can satisfy a craving or get a missing ingredient in minutes,” said Scott Patton, VP of National Buying at ALDI, in a statement. “Together with Instacart, we’ll continue to find ways to innovate and make the online grocery experience even more effortless and accessible.”
Aldi began offering delivery via Instacart in 2017, and has since expanded services to include pickup as well as alcohol delivery.
Aldi’s marketplace moment? While Aldi previously offered delivery, making the assortment available through a virtual store offers the opportunity to create a marketplace for its goods. With the virtual store, it will more closely resemble DoorDash and Uber Eats, which have been expanding their grocery assortment. With a marketplace, additional revenue opportunities could open up for the grocer, such as advertising through retail media.