General Mills’ 301 INC. Leads $6.5M Round for Probiotics
March 9, 2017
General Mills’ venture capital arm, 301 INC. is in the news again – announcing its second investment within as many weeks – agreeing to lead a $6.5 million Series D for Farmhouse Culture, a category leader in probiotic foods and beverages.
Farmhouse Culture was launched in 2008 by Kathryn Lukas, who began selling sauerkraut at local farmers’ markets. In the ensuing years, the company has grown rapidly on the back of growing consumer demand for probiotic-rich foods and beverages, and has expanded its product line to include Gut Shots™ probiotic drinks, and Kraut Krisps™ – a chip made with 50 percent sauerkraut.
Now, with a new, highly experienced executive team in place, the company is expanding further, launching new probiotic lines of Fermented Vegetables including beets, carrots, and cauliflower, among others, and “Gut Punch,” a sparkling probiotic beverage line that will be launched this spring.
“Americans are embracing the positive health benefits of probiotics and are looking for more ways to nurture healthy, good bacteria from real foods,” says John Tucker, Farmhouse Culture CEO. “301 INC. and our existing investors are helping us reach our mission of cultivating generations of healthy microbiomes and improving health and well-being through nourishing probiotic-rich foods.”
301 INC.’s commitment to Farmhouse Culture speaks to the growth potential for the probiotic category.
“We’re seeing such a demand and a high level of interest from all kinds of consumers regarding probiotic foods as a whole, and the conventional retailers are showing a great deal of interest in what we’re bringing to the table,” Tucker told Food Business News.
The capital committed by 301 INC. along with existing investors, White Road Investments and Renewal Funds, will be used to help Farmhouse Culture gain national availability, scale up the production of existing product lines, grow sales and marketing initiatives, and accelerate innovation and development within the functional food category.
“We’ve been watching the functional foods space grow exponentially over the past few years, with Farmhouse Culture emerging as a leader,” said John Haugen, vice president and general manager of 301 INC. “The recipe for success is there: probiotic-rich products that taste great, led by a team with strong experience in the natural foods industry. Our collective goal is for consumers across the country to have access to the full line of these products.”
This Series D comes less than two weeks after 301 INC. and Chicago-based private equity firm, 2x Consumer Products Growth Partners (2x Partners) made a “significant” undisclosed investment in D’s Naturals – an innovative producer of No Cow Bars – plant-based, non-GMO, non-dairy protein bars that also have an extremely low sugar content, and Fluffbutters, a line of protein-infused, dairy-free, low sugar nut butters.
In the last two years 301 INC. has made investments of between $1 million and $18 million in innovative food startups – building up a portfolio that includes not only D’s Naturals and Farmhouse Culture, but organic and non-GMO plant-based snack producer, Rhythm Superfoods; organic cottage cheese startup good culture®; producer of artisanal, nut-based, alternative dairy foods Kite Hill; plant protein-based meat alternative company Beyond Meat; and drinkable soup company Tío Gazpacho.
A record such as this does not go unnoticed. 301 INC. has been noted to be one of the most active corporate venture capital funds in the world, according to a report issued by CB Insights which compiled rankings based on investment activity in the first half of 2016, reports the Minneapolis/St. Paul Business Journal.
Fellow innovative food and agriculture investor, Google Ventures (now known as GV), which just led a $40 million Series C for Farmers Business Network, ranked in the number one spot by CB Insights, but coming in at number 39 only a few years following its launch, 301 INC. already outranks the likes of Time Warner and Merck.
This strength is being recognized by startups looking to grow to the next level.
“Speed to market is a critical element of my vision for the business because I want Farmhouse Culture to be the brand that consumers see as the leader in the probiotic-rich category,” Tucker told Food Navigator. “And the beauty of teaming up with General Mills’ 301 INC. is that it gives us access to world-class resources, R&D capabilities, and supply chain expertise.”
Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration please contact Ms. Kiernan at email@example.com.
Join the Global AgInvesting Community
Share your email to be notified about upcoming events, receive leading industry news and more.
Let GAI News inform your engagement in the agriculture sector.
Receive weekly emails with ag investing and agtech news and insight. Click below to check out our subscription options.