Beer Marketer's Insights
Former NY hedge fund mgr and organic-chocolate marketer who's newly relocated to Austin has opened doors of venture fund called HumanCo that's in hunt for organic food/bev brands and other CPG plays, looking to assemble longterm portfolio of majority-controlled cos. The fund mgr, Jason Karp, who'd earlier launched chocolate marketer Hu Kitchen, in Jan drew $15 mil Series A led by Austin's Vista Equity Partners, and high-profile Austin entrepreneurs Joe and Kirstin Ross. Joe founded identity-protection software co CSIdentity while Kirstin is behind well-known CPG accelerator called SKU, adjacent to which HumanCo has set up its Austin office.
Even as VPX Sports garners attention for its efforts to find viable network for its non-Bang brands in wake of that brand's transition to Pepsi bottling system, a far larger player is quietly preparing to embark on similar hunt: Monster Beverage. With little fanfare, Corona, Calif-based marketer of Monster Energy, NOS and Full Throttle is approaching a milestone in its strategic relationship with Coca-Cola this summer that will leave MNST free to launch a range of non-energy items - both alcoholic and non-alc - that don't necessarily move thru red bottling system. Tho we understand initiative has been delayed a bit by need to keep core business robust during pandemic, it offers promise to distributors of margin-rich entries from proven innovator that's deep in resources to back new entries - as its all-guns-blazing rollout of Reign recently demonstrated in blunting momentum behind Bang.
We'd reported last month that carbon dioxide supplies were becoming a concern to beer and bev marketers as feedstocks used to produce them dried up (BBI, Apr 13). Wall St Jnl weighed in on issue, taking tack that with carbon dioxide output down, soft drink and beer prices might go up. It quotes Russian River brewer Vinnie Cilurzo citing issue as "a big concern" as his CO2 costs in Calif rose 25% in last month, as his supplier turns to Midwest for supplies. (He's holding prices for now.) Production is down about 30% from last yr, reports Compressed Gas Assn, which warned of potential shortage. In 2018, a UK shortage pinched Coke and other suppliers just before the World Cup, but Coke "does not foresee any concerns about supply this time," a spokesperson told WSJ. Still, Brewers Assn's Bob Pease suggested strained supplies could lead to higher prices and "this shortage could become critical in short order." We'd cited similar concerns last month from BA and copackers like Nor-Cal and Steu
Denver-based SCB Global Java Holdings has acquired another small coffee player, White Tale, also based in Denver, while appointing Rob Novick as ceo. White Tale, established by Colombian-raised engineers Nico Anzellini and Tomás Gutiérrez, brings DTC platform that will be deployed for all SCB's brands. It joins pair of earlier acquisitions: Caribbean Coffee Co of Santa Barbara, Calif, and Bona Fide Nitro Coffee & Tea, established by Caribbean Coffee founder John Goerke to promote his "Craft Draft" keg-brewing method for coffee/tea. As for Novick, he's consultant who cofounded Envision Business Consulting (Strong-Bridge Envision). He'll work closely with Russ Matthews, prexy of shareholder SCB Global Capital Management, a boutique investment shop in Denver.
With institutional investors embracing share offering, JAB Holdings said it's closing JDE Peet's offering today, a week ahead of schedule. It anticipates disclosing offer price and exact # of shares tomorrow, tho it reserves right to extend timetable if needed. Initial trading should commence tomorrow on Euronext Amsterdam exchange.
LA-based bev copacker Unix Packaging has settled on site in NC for its first East Coast facility, committing $19 mil to production plant, warehouse and distribution center in Morganton, which is in Blue Ridge Mtns northwest of Charlotte, per local media reports. Decade-old co led by ceo Bobby Melamed already produces branded and private-label drinks ranging from CSDs to kombuchas at 125K-sq-ft plant with 7 lines in Montebello, just east of LA. Few details are available so far of new site, former Ice River Spring bldg, which has been announced only by local authorities, who offered $500K incentive via North Carolina One Fund. Unix has promised 226 new jobs to area. Tho operating in low-key fashion, Unix has been go-to house for many upcoming brands via lower-volume lines and even taking equity stake in some like Pathwater.
Boston beer house Burke Distributing, which has had an on-again, off-again relationship with NA category, has hit the off switch again. After losing Red Bull and then its successor, Bang Energy, the Molson Coors and Constellation house has had enough of segment and decided to exit, once again creating a void for early-stage brands in college-rich early-adopter market that's been chronically underserved since abrupt exit of Blue Coast 4 years ago. Among brands left scrambling to find new home, per Burke website, are 3D Energy, Brew Dr Kombucha, IBC sodas, Voss Water, Virgil's sodas and Yerbae yerba mate line. No immediate response from Burke as to when doors close or whether it's making exceptions in any categories.
Ready Nutrition Enlists Antetokounmpo as Investor/Endorser of Its Sports Drinks, Protein Waters
Ready Nutrition, which is among flock of next-gen nutrition properties that are riding in Body Armor's disruptive wake in category with promise of bringing completely natural recipes, has enlisted as investor/endorser the Milwaukee Bucks star (and reigning MVP) Giannis Antetokounmpo. So-called Greek Freak plans to cultivate his burgeoning fan base in Europe and Asia while also working youth and HS athletes via platforms like Mobile Training Table Program and Ready Talks with Giannis.
When it launched in 2017 vs seemingly impregnable La Croix, many gave Waterloo Sparkling little chance of success, despite its promise of bolder flavor profiles that represent less of a compromise from the CSDs many consumers are weaning themselves from. But Austin-based co cofounded in part by Sweet Leaf and Deep Eddy Vodka spark Clayton Christopher has confounded the naysayers anticipating getting within range of $100 mil in sales by end of this year, more than half of that in channels like Costco and Whole Foods that aren't tracked by syndicated researchers. Ongoing pandemic has brought flock of new consumers into picture and company, urged by key partner Whole Foods, has begun to explore more complex "combinated" flavors like Summer Berry. Under ceo Jason Shiver, it still runs relatively tight, with just 29 on payroll currently, and has eschewed DSD in order to continue to compete against set of aggressively priced rivals that now includes not just National Beverage's La Croix but also Pepsi with Bubly and Coke with Aha. Over past week, we discussed co's strategy and how it's managing thru pandemic with Jason, with highlights as follows.
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