July 19, 2017

Koia, a California-based producer of plant-based protein beverages, announced it has raised a $7.5 million Seed Series round of funding led by KarpReilly and existing investor AccelFoods.

The business was brought to reality by former medical supply salesman Dustin Baker, who witnessed the adverse effects that obesity was having on the population, and co-founded by Chris Hunter, the prior co-creator of caffeinated malt beverage Four Loko. Koia produces refrigerated, ready to drink, plant-based beverages that are soy-free, dairy-free, gluten-free, low-sugar, and non-GMO. The formula is created using a blend of brown rice, pea, and hemp proteins, sugar, and monk fruit, enabling the drinks to have an impressive 5:1 plant protein to sugar ratio.

“We are honored and fortunate to have partners like KarpReilly, AccelFoods, and Bill Moses support our company so early in its life cycle. Their support, alongside the powerful consumer response that we’ve witnessed during our nationwide rollout at Whole Foods Market and with retailers like Wegmans, is validating,” said Chris Hunter, CEO of Koia. “It is a testament to how strongly people value simple, natural, transparent products that don’t force them to compromise on flavor.”

A Return Investment

This round is a return investment for AccelFoods, which added Koia to its portfolio of companies in the spring of this year, marking the firm’s first investment in the plant-based protein category – a category that the fund stated it was targeting for continued pursuit.

At the time, it had just come to light that AccelFoods had reopened its latest funding round for Danone Manifesto Ventures – the venture capital unit of French dairy giant Danone, expanding AccelFoods’ second fund by $15 million to a total of $35 million.

“The AccelFoods organization continually seeks to bring together the key drivers in the food industry; manufacturers, distribution agents, retailers, and investors; all joining forces in an unprecedented willingness to cooperate,” said Jordan Gaspar, co-founder and managing partner of AccelFoods when the expansion was announced.  “Our expanded resources will have considerable impact on the next generation of food and beverage products being introduced to consumers.”

These expanded resources have enabled AccelFoods to reinforce its commitment to the plant-based category – one that is positioned to be at the spear tip of a shifting supermarket landscape.

“…the growing ranks of novel protein sources and potential replacements appeal to the everyday consumer foreshadowing a profoundly changed marketplace in which what was formerly ‘alternative’ could take over the mainstream,” states the Global Food and Drink Trends Report 2016 issued by Mintel.

“We are thrilled to further invest in Koia and the company’s vision of a plant-based future,” said Gaspar. “The consumer appetite for plant-based protein is only beginning.”

A Capital Idea

The capital gained from this round is being earmarked by Koia to fund the expansion of its team, to support the brand’s rapid retail growth, and to fund the launch of a multi-regional field marketing campaign.

“We are in the process of hiring a director of marketing, and we are looking to some other sales roles,” Hunter told Bevnet. “We are really trying to fill out the leadership for each different division and then trying to set goals underneath that.”

Additionally, as part of the round, Bill Moses, founder of Kevita, will join Koia’s Board of Directors.

“We are incredibly excited to partner with Chris and the rest of the Koia team,” said Allan Karp, co-founder of KarpReilly. “We rarely encounter a business that so early on has so clearly resonated with both retailers and consumers alike. Combined with an experienced and talented group of management, advisors, and co-investors, we are confident that Koia is well positioned to become a category leader.”

-Lynda Kiernan

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 lkiernan@globalaginvesting.com.