The Current, delivered daily.
This week, Patagonia acquires nutritious snacks, and a juice company expands through flavorless beverages. Plus, software companies in Amazon marketplace sales, behavioral marketing and EDI raise new funding.
Threecolts raises $90 million
The round was led by Crossbeam Venture Partners and General Global Capital, with participation from Stratos and CoVenture.
Launched in 2021, the company has grown revenue 6x year-over-year, and made 14 acquisitions.
"Threecolts' impressive execution over the past year means that sellers can now access a one-stop shop solution for an increasing number of pain points, easing vendor fatigue and administrative loads,” said Sakib Jamal, senior investment associate at Crossbeam, in a statement.
Wunderkind raises $76M
Financial services company Neuberger Berman led the financing.
Founded in 2010, Wunderkind recently brought on Bill Ingram as CEO. TechCrunch described the platform’s capabilities this way:
Founded in 2010, Wunderkind aims to scale brands’ abilities to foster customer relationships through digital channels. How? By analyzing smartphone and desktop web visitors’ real-time and historical behaviors to match value to intent, Ingram says.
Wunderkind claims it can determine who visitors are based on the web page that referred them and the content that they’re interacting with.
Wunderkind works with more than 1,000 brands, including Rag & Bone, HelloFresh, Uniqlo, Sonos and See’s Candy.
Odyssey Wellness raises $6.3M for functional mushroom energy drink
Odyssey Wellness, a sparkling energy drink with functional mushrooms, raised $6.3 million in a Series A round.
With functional mushrooms including Cordyceps and Lion’s Mane, Odyssey Wellness aims to promote brain performance, energy, focus, and mood without caffeine.
The brand launched in 2021, and is now available at over 5,000 brick and mortar locations, including natural, conventional retailers, and c-stores. The brand has also carved out a presence in upscale bars, restaurants, hotels and music festivals.
Crstl launches with $4.4M in seed funding for B2B ecommerce platform
The financing was led by Mastry Ventures, with support from Village Global, Alumni Ventures, SuperAngel VC, On Deck, Mensch Capital Partners, Harizury, as well as founders and executives from Uber, Faire, Instagram, Stedi, ShipBob, OpenStore, Motive.
Crstl’s technology is provides an update to the electronic data interchange (EDI) that uses APIs and is built for commerce.
“There is palpable pain felt by thousands of U.S. brands expanding into retail. Diversification from direct-to-consumer to retail and marketplaces is not a nice to have, but a necessity today. And even when these brands win business with Target or Walmart or Whole Foods, they are stuck dealing with legacy solutions that create delays and big holes in their plans, and thus P&L,” said Fatima Husain of Mastry Ventures, in a statement. “Crstl is the painkiller these brands have been looking for: a faster, better, affordable EDI solution.”
Mergers and acquisitions
Moonshot acquired by Patagonia Provisions
Moonshot is a climate-friendly snack brand that makes wheat using regenerative and organic practices, and has a supply chain where its farmer, miller and manufacturer are all located within 100 miles of each other.
Terms of the deal were not disclosed.
Gen Z acquired by Langers
Founded in 2021, GEN-Z sells “flavorless, transparent liquid” in a reusable, recyclable bottle that cuts through Zoomer's high BS-meter.”
While the brand features critters on packaging and doesn’t take itself too seriously in messaging, it has a serious mission to reduce plastic waste. The brand initially grew through ecommerce.
In Langers, it is joining a company that has sought to push away from glass bottles, and is looking to “future-proof” its business, said CMO Erin Campbell.
Terms were not disclosed.
Criteo acquires offline media platform
Over the last year, Criteo has worked with a variety of retailers to establish retail media networks that enable advertising on their ecommerce marketplaces.
The addition of Brandcrush comes as additional opportunities emerge to serve digital advertising in stores and through other offline channels such as samples and inserts.
Brandcrush’s platform provides a single place to manage orders, inventory, and supplier management across channels.
Terms were not disclosed.
Trending in Operations
Campbell Soup Company CEO Mark Clouse offered thoughts on messaging amid inflationary shifts in consumer behavior.
After months of elevated inflation and interest rate hikes that have the potential to cool demand, consumers are showing more signs of shifting behavior.
It’s showing up in retail sales data, but there’s also evidence in the observations of the brands responsible for grocery store staples.
The latest example came this week from Campbell Soup Company. CEO Mark Clouse told analysts that the consumer continues to be “resilient” despite continued price increases on food, but found that “consumers are beginning to feel that pressure” as time goes on.
This shows up in the categories they are buying. Overall, Clouse said Campbell sees a shift toward shelf-stable items, and away from more expensive prepared foods.
There is also change in when they make purchases. People are buying more at the beginning of the month. That’s because they are stretching paychecks as long as possible.
These shifts change how the company is communicating with consumers.
Clouse said the changes in behavior are an opportunity to “focus on value within our messaging without necessarily having to chase pricing all the way down.”
“No question that it's important that we protect affordability and that we make that relevant in the categories that we're in," Clouse said. "But I also think there's a lot of ways to frame value in different ways, right?”
A meal cooked with condensed soup may be cheaper than picking up a frozen item or ordering out. Consumers just need a reminder. Even within Campbell’s own portfolio, the company can elevate brands that have more value now, even if they may not always get the limelight.
The open question is whether the shift in behavior will begin to show up in the results of the companies that have raised prices. Campbell’s overall net sales grew 5% for the quarter ended April 30, while gross profit margins held steady around 30%. But the category-level results were more uneven. U.S. soup sales declined 11%, though the company said that was owed to comparisons with the quarter when supply chains reopened a year ago and expressed confidence that the category is seeing a longer-term resurgence as more people cook at home following the pandemic. Snacks, which includes Goldfish and Pepperidge Farm, were up 12% And while net sales increased overall, the amount of products people are buying is declining. Volumes were down 7%.
These are trends happening across the grocery store. Campbell is continuing to compete. It is leading with iconic brands, and a host of different ways to consume them. It is following that up with innovation that makes the products stand out. Then, it is driving home messaging that shows consumers how to fit the products into their lives, and even their tightening spending plans.
Campbell Soup is more than 150 years old, and has seen plenty of difficult economic environments. It is also a different business today, and will continue to evolve. At the end of the day, continued execution is what’s required.
“If it's good food, people are going to buy it, especially if it's a great value,” Clouse said.