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Quarterly Consumer Review

19 October 2023

We’re back for the third installment of Dwight’s Quarterly Consumer Review, and we have much to discuss. 2023 has flown by for food & beverage brands channeling energy and capital toward growing their retail footprint, for digitally native brands breaking into brick-and-mortar, for investors closing new funds, and for all of us following along for the ride. 

This time around, we’re sharing market insights directly from Dwight’s leadership team who are in the trenches with founders every day advising on and funding growth strategies. What channels or strategies are working for top brands? What are investors looking for? What can we expect from the fundraising landscape going forward? Let’s dive in.

JULY – SEPTEMBER 2023

Quarterly Fundraising Index


In case you missed it, check out our Q2 industry review and fundraising index here.

Consumer Product Trends


Beauty

Specialty Beauty & Tanning

As viral marketing trends continue to influence consumer and investor activity in the beauty sector, a new term, ‘Quiet Luxury’ is sweeping the zeitgeist and breathing new life into familiar names like Dr. Barbara Sturm and Claudelie. While seasoned skincare customers return to pricier legacy solutions, highly specialized beauty brands catering to historically underrepresented and unique audiences are carving out their niche and shaping a more inclusive industry. 

Specialty Beauty in the news…
  • Men’s personal care brand Blu Atlas is acquired by Foundry Brands for an undisclosed eight-figure sum
  • Male grooming company Manscaped enters Boots in the UK and Ireland
  • Men’s personal care brand Dr. Squatch has entered the razor category in partnership with Henson Shaving
  • Gen-Z focused skincare brand Bubble expands to Ulta stores nationwide.
  • Bubble announces new Bubble on Campus program to drive brand loyalty among Gen Z
  • Clean Age’s teenage deodorant & bodycare essentials enter Walmart
  • Indu, a teenage beauty brand started by the co-founders of Feelunique, raised $4.8MM pre-launch.
  • Lovekins, an Australian skincare brand designed for mothers and babies, is acquired by Access
  • Proudly, Gabrielle Union and Dwayne Wade’s baby care brand, announces new line of haircare products aimed at children with curly and coily hair
  • Necessaire releases body care duo targeting body acne
  • Off court, manufacturer of care products for active lifestyles, enters 1,800 Walmart stores
  • Inclusive cosmetic brand Pound Cake expands into 800 Ulta Beauty locations
Tanning in the news…
  • Tokyo-based Kao Corporation has acquired Australian self-tanning brand Bondi Sands. Terms weren’t disclosed but the brand was reportedly valued at $450m.
  • Bondi Sands continues US expansion with Walmart roll out
  • Aria Growth Partners is reportedly close to acquiring a minority stake in Australian suncare brand Ultra Violette
  • Private equity firm Gauge Capital has acquired Australian self-tanning brand Loving Tan. Terms weren’t disclosed

Food

Ready-to-Eat Global Cuisine & The Restaurant Collab

While some of the most decorated dining institutions around the world celebrate authentic global cuisine, the same cannot be said for the pantry aisle. Until now. Finally the same inspired flavors are flying off the shelves and establishing cult-like followings of their own. Another way that the food & beverage industry is bridging the gap between hospitality and CPG is through strategic collaboration.

International flavors in the news…
  • Japanese BBQ sauce Bachans releases new Miso flavor at Sprouts
  • Nona Lim, better-for-you Asian street food producer, is acquired by DayDayCook (DDC)
  • Mexican-American food brand Siete Foods launches a new line of taquería-style and casera-style salsas at Whole Foods. 
  • Sweetgreen and Siete Foods collaborate  on limited edition potato chip that pairs Siete’s heritage flavors and Sweetgreen’s popular Green Goddess dressing. 
  • Emil Capital Partners invests in A Dozen Cousins, producer of flavorful dishes inspired by Caribbean, Creole, and Latin American recipes.
  • Babas Hummus opens first retail location in Minnesota after its authentic Middle Eastern dishes gain traction through eCommerce. 
  • Grammy nominated group Sofi Tucker partner with Novo Fogo on limited edition sugarcane spirit that honors traditional Brazilian flavors.
  • Momofuku Goods, the CPG arm of Celebrity chef David Chang’s contemporary Asian-American restaurant chain, raises $11.5MM growth funding round led by Alliance Consumer Growth. Siddhi Capital also participated. 
  • SOMOS Foods is launching its easy authentic Mexican recipes at 1,800 Target nationwide
  • Rupee Beer, an Indian-inspired beer shares Indo-Mex collaboration with Maya Kaimal Foods
Restaurant partnerships in the news…
  • Malk launches a smoothie at Erewhon in collaboration with influencer Marianna Hewitt
  • Sweetgreen and Siete Foods collaborate on limited edition potato chip that pairs Siete’s heritage flavors and Sweetgreen’s popular Green Goddess dressing. 
  • NYC’s Funny Face Bakery partners with Graza on Olive Oil Lemon-Thyme Cookies
  • Shake Shack announces partnership with Zero Acre Farms to pilot their healthier, more eco-friendly cooking oil at two locations in NYC
  • SkinnyDipped and Blank Street Coffee team up on limited edition line of dark chocolate almonds that are dusted with coffee

Beverage

Ready-to-Drink Energy (RTD)

Caffeinated and performance-enhancing beverages have the RTD beverage sector buzzing.

Energy RTD in the news…
  • Fitness drink Barcode receives investment from fresh basketball phenom, Victor Wembanyama.
  • Beanless coffee brand Minus receives new seed funding from Amplifica Capital.
  • LIFEAID introduces 10th Flavor in FITAID line of performance and recovery drinks.
  • Keurig Dr. Pepper takes 33% stake in coffee roaster & retailer La Colombe for $300MM.
  • Alani Nu is considering a sale
  • PRIME Hydration, sports & energy drinks and mixes by Logan Paul, heads into Wawa.
  • PHOCUS releases new Pineapple flavor exclusively sold at The Vitamin Shoppe
  • Energy drink brand G FUEL has pushed into the snack category with the launch of its Protein Puff line.
  • Chamberlain Coffee reveals re-formulated RTD lattes.
  • Plant-based energy drinks & seltzer producer Yerbae secures $4 million in additional funding through its private placement of 2.2MM company shares priced at $1.83 per unit.
  • The Rock’s ZOA Energy rakes in another investment from Molson Coors.
  • Nguyen Coffee Supply expands into Target locations nationwide
  • Cometeer unveils new packaging for coffee capsules at Expo East
  • Functional coffee brand Taika is now available at 265 Whole Foods Market stores in 16 states
  • Celsius named official energy drink of Major League Soccer
  • UK-based beverage firm Britvic acquires Jimmy’s Iced Coffee
  • LA-based Later Days Coffee launches sustainable packaging  at Whole Foods Markets throughout California
  • Super Coffee launched their new XXTRA Iced Lattes at 7-Eleven in New York
  • Third Wave Coffee completes $35MM Series C led by Creaegis. Westbridge Capital also participated in the round.

Child Health & Personal Care

Entering the Better-For-You Era

The better-for-you era for children’s products is in full swing as parents, investors, and celebrities alike rally around premium quality CPG brands for their little ones.

Children’s Health & Personal Care products in the news…
  • Organic infant formula brand Bobbie raises $70MM in Series C funding to acquire Nature’s One. PowerPlant Partners led the round with a $35MM investment.
  • LesserEvil partners with Disney on a line of Toy Story-inspired puff snacks. 
  • Genexa launches new organic flavor of their best-selling kids’ medicine.
  • Teton Waters Ranch introduces Teton Taste Buds line of better-for-you meal options for kids.
  • ByHeart, DTC baby formula, celebrates first retail move after entering 1,000 Target stores
  • Target adds baby and toddler products to its private-label food brand Good & Gather
  • Proudly, Gabrielle Union and Dwayne Wade’s baby care brand, announces new line of haircare products aimed at children with curly and coily hair. 
  • Freestyle diapers are now available nationwide at Whole Foods
  • Clean label infant nutrition brand By Heart launched nationwide at Target

Fundraising Landscape


We’re halfway through 2023, and we’re starting to see which brands have managed to thrive in the face of economic fluctuations and shifting investor and consumer interests. Dwight team members and industry pros Jessica, Todd, and Ben are here to share a few of the successful strategies and emerging patterns of brands and equity providers at the top of their game.

What recent fundraising trends have stood out to you in Q3?

“We all know that investor sentiment has shifted in the last 9 – 12 months from a focus on growth at all costs, to slightly tapered growth paired with profitability. As a result, we’ve seen a number of investors pull back on new equity checks as companies figured out this new model. Rounds have been taking more time to close, and have yielded lower valuations.

However, there is still a ton of dry powder on the equity side that needs to be put to work. In Q3, we started seeing a pick up of equity processes in the market, which is a positive signal that companies are growing with healthier metrics and a great sign for the consumer category overall.”

Jessica Bates

Managing Director + Head, Business Development

What business trends have stuck out to you?

“Most food & beverage brands are leaning into relationships with the key players in retail and distribution to attract customers in new regions. There’s also a major emphasis on building out their Club channel, and many businesses have found success from programs like Costco’s physical or digital MVM. While achieving national scale through this channel is known to be challenging, stand-out products were able to stay on shelves, consistently attracting new retail partners and customers as a result.

On the DTC side, the brands that are able to accurately forecast out their inventory needs are seeing the most success. It’s easy to overlook when demand is skyrocketing, but effective inventory planning is the key for CPG and digitally native brands to free up cash flow and invest in growth.”

Todd Scobell

Director, Portfolio

What can we expect going into Q4 and beyond?

“For a multitude of reasons, businesses are going to start to transact. While a turbulent economic environment is not always the ideal environment to command the best price, we will see some success stories come out of the public markets. We will also see some M&A in the private markets amongst smaller brands that are combining to reach scale, and amongst breakout brands that may look for majority transactions.”

Ben Brachot

Co-Founder, Managing Director


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