Bevscape/NOSHscape/Brewscape Bossa Nova Returns; Last

Bossa Nova Recruits Neil Kimberley to Steer Relaunch as Functional Sparkling Brand

Seventeen years ago, Bossa Nova helped create the market for acai juices in the U.S. Now, its founder Alton Johnson – working alongside beverage industry veteran Neil Kimberley, himself fresh off a nineyear stint as Chief Strategy Officer at premium water brand Essentia – is bringing the defunct brand back, although this time it will be dancing to a different beat.

Bossa Nova relaunched in August online and in California retailers with a line of functional sparkling waters made with plant-based ingredients like acerola, acai berry, dragonfruit, yerba mate and lotus flower. The seven-SKU line is built around various functional benefits including Immunity (Orange Acerola), Thrive (Raspberry Acai), Recover (Limelyte), Protect (Mango Dragonfruit), Energy (Lime Yerba Mate), Renew (Pinot Grape) and Relax (Pineapple Hop). Each 12 oz. can contains 5% fruit juice and sells for $29.99 per 24-pack online.

Johnson, who is serving as CEO, recruited Kimberley to serve as Bossa Nova’s president earlier this year, after the former Snapple exec bowed out of his role with Essentia in July, having helped build the company into a category leader and guided its exit to Nestle Waters North America in last year.

“I’ve been fascinated by the sparkling water space for a while,” Kimberley told BevNET in a call in August. “I came from Snapple, which is a flavor-oriented business, and then ended up at Essentia, which is very much about package, pricing and location in store. So I was always really intrigued by how you can merge together water concepts with the flavor experience that I’ve had.”

Johnson originally founded Bossa Nova Beverage Group in 2001 after learning about the health benefits of the acai berry; a bottled juice line didn’t hit stores until 2005 but made waves as the first RTD acai beverage in the U.S. The brand was later acquired by Beverage Holdings LLC in 2009 and placed in the same portfolio as Sunny D. Two years later, Johnson left the brand and the beverage industry altogether, making a career move into real estate. Without him steering the ship, Bossa Nova struggled under a mismatched brand management strategy and ultimately was taken off the market.

In 2017 Johnson said he was approached with an opportunity to repurchase the IP and, inspired by the growth in the sparkling water category, he began working on the new product lineup with plans to relaunch the brand as a whole new company.

Johnson told BevNET in a separate interview that he has been working full-time on the new Bossa Nova for about four years, attempting to fill what he sees as a white space for low calorie, plant-based sparkling beverages. While there have been a number of functional sparkling water entrants over the past few years – including brands like Recess, Good Idea, Limitless and Soulboost, among others – Johnson said he believes Bossa Nova provides “a more elegant,” plant-based solution for consumers.

In particular, Johnson said Bossa Nova will be a more affordable option with a focus on breaking out into mainstream channels; “The plants have the ability to shine without it being a $2.99 premium single-serve,” he added.

While recent years have seen several relaunches of nostalgic legacy brands like Slice and Clearly Canadian, Johnson said he isn’t aiming to invoke the memories of the old Bossa Nova acai juice so much as he’s bringing the brand into the present day while remaining true to its platform of plant-based nutrition. Beyond Kimberley, Bossa Nova has also hired another Essentia veteran: Patrick Katchak, formerly the director of national accounts - Central Division for the premium water brand, as its new VP of national accounts. The company has also hired a CMO with beverage industry experience, Johnson said. Zolezzi Enterprises CEO and founder Anthony Zolezzi has also joined as a co-founder and board member. The company is currently raising a friends and family funding round. According to Johnson, Kimberley will play a vital role by overseeing much of the operational strategy and he is currently working to establish a distribution network for the brand as it rolls out to stores this month.

“Neil Kimberley, he is who he is and I thought he was the ideal partner to be the yin to my yang. I’m the product guy and I want to connect with consumers with this culture of plants with benefits,” Johnson said.

Kimberley said he is targeting small tastemaker retail chains to seed the brand’s brick-and-mortar presence, eyeing stores like Erewhon, Fresh Thyme, Earth Fare, Harmons and Molly Stones. Currently, he said Bossa Nova is in its “tweak process,” where the company will closely monitor early performance to ensure the packaging, formulation and communications are resonating with shoppers, before making a strong push into conventional channel outlets.

This new venture also places Kimberley in unfamiliar territory – startup culture. Although he played a pivotal role steering Essentia to its exit to Nestlé last year, the brand was already 15 years old when he joined the company. Now, Kimberley said he hopes the team’s broad beverage industry experience will help shorten the growth curve for Bossa Nova. But despite starting from the ground up, he said he’s looking forward to confronting the challenge.

“We used to say at Essentia that every year you stood at the bottom of the mountain and looked at the peak and wondered if you could get there. This is that, but I guess 10x right now,” Kimberley said. “So we’re standing at the bottom of the hill, looking at the top of the mountain trying to figure out ‘Okay, how are we going to get up there?’ And that’s the exciting part at the end of the day.”

Lance Collins, Mike Repole Reunite to Launch RTD Tequila Cocktail Casa Azul

With tequila and ready-to-drink (RTD) cocktails becoming two of the hottest alcohol categories, Lance Collins is looking to have a hand in both.

As the founder and chairman of tequila soda brand Casa Azul, launched in August, the beverage mogul behind Fuze, NOS, BodyArmor and Core is confident his new line of tequila soda will hit the sweet spot for consumers of spirit-based canned cocktails who enjoy the low-ABV and low-calorie qualities of a hard seltzer.

Collins, whose other beverage endeavors have reached stratospheric success, is positioning the 12 oz bright blue can in opposition to ranch waters or canned margaritas that use malt liquor by framing it as a product with a simple ingredient list. The 5% ABV sodas will come in four flavors and are made of sparkling water, tequila, natural fruit flavors and agave nectar.

“We’re reaching both hard seltzer drinkers looking for a premium offering, and canned cocktail drinkers looking for ease and convenience,” he said. “People want real spirits and quality ingredients, but also something that’s easy to drink anytime and anywhere.”

This is the first alcohol-based release from a team of beverage industry veterans whose latest innovations have made their marks in the wellness and energy drink categories. Former Glaceau president and BodyArmor chairman/co-founder Mike Repole joins Collins as a co-chairman of the board, along with Bryan Crowley as board director and interim president. Crowley brings over two decades of building and accelerating brands like AB Inbev, Pabst, and VEEV Spirits.

NOS Energy Drink, part of FUZE, and BodyArmor Super Drinks sold to the Coca-Cola Company in 2007 and 2021 respectively, with BodyArmor, which Collins co-founded with Repole, ranking as the beverage giant’s largest acquisition at the time at $5.6 billion. Core Hydration was acquired by Keurig Dr. Pepper in 2018.

By bringing tequila into the mix, the founder is hoping to capitalize on the agave spirit’s upwards trajectory. Tequila was the second-fastest growing spirits category in 2021 according to the Distilled Spirits Council of the U.S. and canned tequila 355ml offerings increased share from 7% in 2019 to 31% in 2021, according to the IWSR. Casa Azul’s tequila is produced in Jalisco, Mexico, with the product crafted and canned in the U.S.

“It’s a broad audience because we’re bringing real Tequila to the party, but still offering something that’s low on calories and carbs and sessionable for daytime drinking,” he said.

The brand will join low-ABV tequila RTDs on the market such as Onda and Crook & Marker that also tout low-sugar and real ingredients, as well as canned line extensions from established names like Hornitos and Tequila Cazadores.

Throughout the year the company will be announcing “exciting celebrity and influencer partnerships” according to Collins, and has plans to continue to expand the line in 2023.

All flavors will be sold in single flavor 4-packs and a variety 8-pack with two of each flavor, an increasingly popular format for RTDs. The suggested retail price is $12.99 for a 4-pack.

The beverage initially launched with national distributor RNDC and was first available in California, Colorado, Texas, Georgia, and Florida. Plans to roll out in Mexico are also in the future.

Electrolit Names Christian Patiño Webb as CEO

Seth Goldman’s Eat the Change Raises $14.5M to Fuel Just Ice Tea Launch

Hydration beverage producer Electrolit has named former Red Bull senior director of marketing Christian Patiño Webb as its new CEO.

Patiño Webb comes to the company from Unilever, where he served as VP of marketing for SmartyPants Vitamins. He began his career at Procter & Gamble where he spent seven years, moving up from a fi nance and sales intern to become an associate brand manager for Herbal Essences. He later held executive level positions at Natural Hemp Company and Brandable, as well as spending fi ve years at Red Bull.

“It is an exciting opportunity to lead a brand with the legacy and momentum that Electrolit has and even more with the potential moving forward,” said Patiño Webb said in the release. “My focus for the company is to take the brand from a regional to a global landscape, becoming a talent incubator, and continue driving growth for beverage industry behind best in class innovation.”

Eat the Change, the healthy snack brand founded by Seth Goldman, has raised $14.5 million in new funding to support its expansion into the ready-to-drink tea category.

In June, Goldman announced plans to launch a new organic bottled tea line called Just Ice Tea under the Eat the Change platform after The Coca-Cola Company said it will discontinue Honest Tea, which Goldman co-founded and ran from 1998 to 2019. The new brand, Just Ice Tea, is intended to “fi ll the void” for a clean label, semi-sweet tea drink that Honest will leave behind when it is offi cially discontinued later this year.

According to the Washington Business Journal, which fi rst reported the story, the latest fi nancing round was led by Collaborative Fund and S2G Ventures, which combined contributed around $10 million. Collaborative Fund founder Craig Shapiro and S2G senior executive partner Walter Robb will join the brand’s board as observers. Additional investors include Honest Tea co-founder and Eat the Change board member Barry Nalebuff, tea suppliers and some Honest customers, Goldman told the publication.

Eat the Change is now seeking an additional $500,000 in fi nancing to meet a $15 million goal, according to Goldman. The brand, whose core product lines include carrot chews and mushroom jerky, previously raised $4.5 million in March.

A subsidiary of Mexico-based Pisa Pharmaceuticals, Electrolit was originally created in the 1950s as a medical-grade rehydration solution. The brand launched in the U.S. in 2015, positioning itself as both a sports drink and a hangover recovery beverage, and has now established a nationwide footprint – in over 30,000 doors across the country as of 2020.

According to IRI, Electrolit is now the fourth largest brand in the U.S. sports drink category, up 103.8% to $309.2 million in retail dollar sales for the 52-weeks ending June 12, 2022. Comparatively, Powerade ranks directly above the brand, up 3% to $1.25 billion, but private label drinks trail behind it, increasing 66.8% to $56.6 million in the same period.

The brand has continued to target mainstream consumers through its marketing efforts. In May, Electrolit partnered with Mexican racecar driver Pato O’Ward for the 2022 season and mountain climber Juan Diego Martinez Alvarez. In June the company announced a new omnichannel campaign including TV ads, billboard, transit center displays, social media and infl uencers. The campaign intends to further Electrolit’s appeal to active consumers, featuring athletes and fi tness enthusiasts.

Last year, Electrolit introduced a sugar free zero calorie line in Berry Blast, Lemon Breeze and Fruit Punch Splash fl avors, intended to meet consumer demand for low sugar drinks.

Goldman told BevNET in June that Just Ice Tea will launch with six SKUs. The fi nancing will go towards expanding Eat the Change’s manufacturing operations to support the new line in addition to distribution. The company also plans to hire at least six employees in the near future.

According to Business Journal, Just Ice Tea was scheduled to begin a pilot run in August and the drinks will start rolling out to select Maryland stores in September, with two more national retail partners set to begin carrying the brand in October. About 1,000 stores are already committed.

On LinkedIn in August, Goldman hinted that the brand will have additional news coming but did not specify beyond that.

“With the snacks, we weren’t always getting our calls returned, just because it was more unknown,” Goldman told Business Journal. “With this, it’s known — and there’s an urgency on the customers’ part because the shelf space is opening up; just because Coke is pulling out doesn’t mean that the category, or the consumer, has disappeared.”

Class Action Alleges DFA Has Acted as Raw Milk Monopsony in Northeast

Dairy Farmers of America (DFA) is the target of a class action antitrust lawsuit fi led in July, alleging the largest national dairy cooperative has acted or has tried to act as a monopsony by constraining the Northeast raw milk market.

The complaint, fi led on July 29 in the U.S. District Court in Vermont, claims DFA has created a confl ict of interest with its member farmers by expanding into dairy processing, withheld profits from its processing operations, and has moved to control the Northeast raw milk market through “predatory and exclusionary actions” by coercing farmers to become members through acquiring competing businesses and exclusive supply contracts.

According to the complaint, the alleged actions began at least on May 10, 2016 and add up to DFA creating a monopsony – a single buyer market – for non-organic raw milk. That environment kept milk prices lower while simultaneously pushing competing dairy cooperatives “to the brink of insolvency,” allowing DFA to acquire the distressed organizations and further consolidate the market.

The lawsuit also claims DFA purchased milk hauling fl eets that serviced non-DFA farmers and then withdrew services until those farms agreed to join the cooperative and also that it withdrew its fee-based marketing services from non-members as another tactic to force membership. DFA also allegedly sought to acquire processing facilities, removing more options for non-members.

Among the deals cited by the complaint are DFA’s 2017 purchase of Cumberland Dairy Milk Producers in Bridgeton, New Jersey; the 2019 merger of Vermontbased St. Albans Cooperative Creamery; its 2020 acquisition of defunct dairy conglomerate Dean Foods; and a 2021 exclusivity agreement with Wakefern Food Corp. to serve as the sole supplier for its Readington Farms branded milk bottling plant in White House, New Jersey.

While the alleged control would provide a challenge for independents in any sector of food and beverage, the suit notes the fast-paced nature of the raw milk market – in which cows must be milked twice daily and the product is highly perishable – poses a more urgent threat for these non-member farmers who “could go out of business within days or weeks if they cannot access a market for their raw milk,” the complaint states.

The Northeast region includes 11 states, including all of New England, New York, New Jersey, Delaware, Maryland and eastern Pennsylvania.

“The result of DFA’s anticompetitive, exclusionary, and predatory conduct is that it has reinforced and extended its monopsony buyer power over the Northeast market for raw milk (measured as a % of volume marketed), from approximately 40%-55% on the eve of the Class Period to approximately 50%-60%,” the complaint states, noting that one report estimated DFA controls 85% of milk processing in the Northeast region.

In a statement shared to media outlets, Kristen Coady, SVP, corporate affairs for DFA, called the allegations “baseless and completely without merit.”

This is not the only antitrust lawsuit fi led against DFA this year. In April, a class action fi led in New Mexico made similar allegations against the cooperative for its actions in the Southwest region. The complaint accused DFA of conspiring with Select Milk Producers Inc. to “stabilize and depress pay” for member farmers through price data sharing and skimming profi ts. Two of the law fi rms involved in this new case – Hagens Berman Sobol Shapiro LLP and Lockridge Grindal Nauen PLLP – are also representing plaintiffs in that class action.

Notably, the Southwest lawsuit is focused on a specifi c conspiracy claim, while the Northeast case revolves around monopsony, despite the end impact – farmers facing fi nancial distress due to price control – being fairly similar. However, the different violations alleged in the two suits means decisions made by the court in one case may not necessarily impact the other.

Beyond that case, DFA has been a frequent target of antitrust claims and other lawsuits over the past decade with varying results. According to Lancaster Farming, “the co-op and other defendants agreed to pay a $159 million settlement with Southeastern farmers in 2013” and in 2016 a federal judge approved a $50 million settlement to be paid by DFA to Northeast farmers, however 116 of those farmers rejected the settlement and reached a new settlement in 2020 for undisclosed terms.

DFA also faced challenges in response to its acquisition of bankrupt dairy producer Dean Foods Co., which was settled for undisclosed terms in February 2021. Prior to that, the two companies settled a lawsuit alleging price fi xing in 2014 for $350 million.

Last year a federal judge dismissed a lawsuit fi led by farmers in New York asking DFA to be broken up. Also in 2021, DFA settled with the Maryland & Virginia Milk Producers Cooperative Association and Food Lion, who had sued the cooperative.

The lawsuits come at a time where the number of U.S. dairy farms has been in a decades long decline. A 2021 USDA report found 31,657 total licensed dairy producers in the U.S. in 2020, down 2,550 from the year before. Between 2003 and 2020, the total number of farms fell by more than 55%.

While the DFA cases deal primarily with non-organic milk, the issue has also impacted organic farms as well. Last year, Maple Hill Creamery and Danone-owned Horizon Organic both moved to terminate purchase contracts with Northeast family farms. In response, Stonyfi eld Organic announced it would invite impacted farms to join its direct supply program. Stonyfi eld co-founder Gary Hirshberg also founded nonprofi t group Northeast Organic Family Farm Partnership to support the independent operations.

Meanwhile, Wisconsin-based cooperative Organic Valley is also making moves into the Northeast. In August, it announced 51 new member farmers in Vermont, New Hampshire, Maine and New York – its fi rst partners from the region.

CENTR Grows Inside and Outside CBD With New Product, ‘Traditional’ Execution

In a category buzzing with noise, CENTR has been quietly waiting for its moment to roar.

Thanks to its eponymous CBD-infused soda, the publicly traded Vancouver-based functional wellness beverage brand has emerged from the pioneering days of CBD drinks as a fast-growing category player. According to data from Brightfi eld Group, in the fi rst half of 2022, CENTR, which is sold in stores in 25 states, had 1.03% share of the U.S. CBD beverage market, a category projected to reach nearly $192 million in sales this year.

With wind its sails, the company is preparing to amplify its message in the coming months, investing in marketing and releasing a brand new non-infused product line.

“A lot of the investments that we’ve made over the past three years are ones that you don’t see,” said CEO Arjan Chima. “We are really investing in the retailers through traditional beer-style marketing and advertising because that’s what retailers get and understand.”

The brand itself was created by a small group that included Chima and Paul and Melissa Meehan; the latter pair are the founders of distillery and spirits business Goodridge&Williams, maker of NUTRL Vodka, which was sold to Labatt Breweries of Canada, a division of Anheuser Busch InBev, in January 2020. NUTRL has since been launched in the U.S. as a ready-to-drink vodka seltzer. Chima was involved in that business as Chief Commercial Offi cer in addition to his work at the Meehan’s marketing agency, me&ideas. He subsequently has held various roles at CENTR including Board Member, CFO and President before taking on the CEO role in June.

The brand’s success thus far has been based primarily on service and execution, partnering with independent retailers and driving traffi c for its two-SKU line of sparkling soft drinks in 12 oz. cans. During the onset of the COVID-19 pandemic, Chima said the brand focused on independent groceries and c-stores, making the investments with those partners to keep CENTR on the shelf and in coolers. Healthy margins helped make their case; delivering 30mg of CBD for $4.99 per can, CENTR is more cost effective, even though Chima acknowledged consumers “aren’t there yet.” Consistent collaboration with retailers on promotions, temporary price reductions and ad buys “within their ethos and ecosystem” decreases the need for CENTR to constantly reinvest.

Whereas many startups seek out younger talent to handle fi eld operations, CENTR sought experience, stacking the sales team with veterans from Red Bull, Gallo and across the beverage industry, which Chima said was invaluable in helping the brand become one of the fi rst CBD drinks to be nationally distributed by Southern Glazer’s Wine & Spirits in April 2021, providing further market validation.

“It was sort of let us show you how we can do this together,” he said. “The conversations that we’ve had to convince the retailer and the distributor has been the experience on our team. Having done it from a top of the house level before and knowing how to invest properly in a brand, as opposed to just putting it on the shelf and letting it die.”

As for the product itself, CENTR is all about simplicity. The formulation uses a CBD isolate, rather than a full-spectrum extract. The can’s basic black and white design makes it more approachable for a wider age demographic, Chima argued, while focusing on a single, signature fl avor available in regular (cane sugar) and zero-sugar versions with no natural or artifi cial sweeteners. That approach will continue as the brand creates more products.

“It’s kind of like how Red Bull just tasted like Red Bull before they started launching their other fl avors,” Chima said. “For us, CENTR tastes like CENTR.”

And like Red Bull, the company has targeted c-stores as its primary growth channel. Along with brands like Kill Cliff (also distributed by Southern Glazer’s), CENTR is part of a cohort that is developing the segment as a path to bring CBD-infused beverages to middle income consumers that may not fi t the yoga-and-wellness profi le that other brands have attached themselves to. According to Brightfi eld Group, CBD-infused products generated $162 million in dollar sales in cstores in 2021, with that number expected to rise to $193 million in 2022, or about 4% of the total pool. The channel represents around 19% of the $175 million CBD beverage market.

For other channels, CENTR has other products. The brand has showcased more dynamic fl avors (Pomegranate Hibiscus, Cucumber Yuzu) in its three-SKU line of powder drink mixes, but Chima sees CENTR’s non-CBD drink Enhanced, set for launch in October, as a “game-changer.” The single-fl avor sparkling product will feature adaptogens and nootropic ingredients aimed at promoting immunity, mood, focus and other functional need states, and will be available in caffeinated (Enhanced+) and non-caffeinated varieties.

It’s become something of a standard play for CBD beverages to release a complementary non-infused line that can seed brand awareness in a larger pool of retailers that would otherwise not be available; see Cloud Water, VYBES, Recess and others. That’s why marketing and educating consumers about why to choose CENTR will be critical in fueling its continued expansion. CENTR will spend “signifi cantly” on marketing and advertising in this fi scal year, Chima said, by investing in infl uencers and media buys, as well as experiential wellness-themed activations, one of which is scheduled for this Thursday in Los Angeles.

“That’s what’s exciting,” he said. “I’ve been waiting for three years to really invest in the marketing side of it and now we’re going to spend a considerable amount of money in marketing to drive our online sales, brand awareness and really leverage infl uencer partnerships.”

That work will focus around marrying functional wellness with active lifestyles, not exactly a stretch in California where CENTR does most of its business. But the brand is also looking to take the overall category into new directions. CENTR is the fi rst CBD drink to do a digital media buy with rapid delivery platform Gopuff, while Chima said CENTR Enhanced is in discussions with New York University to study how functional ingredients included in the product can impact e-sports performance.

“People talk about the scale of [the category]; now if you’re gonna invest in it, you gotta invest in it properly and take that long term approach, as opposed to that quick adrenaline shot in the arm and hope someone buys you out,” he said. “That’s not our play. Our play is truly to build a business.”

Brain Boost: Mindright Makes the Jump Into Chips

Functional food and beverage brand Mindright is moving further into the snack set with the launch of a new line of nootropic-infused puffed chips.

The chips arrive a little over a year after the brand fi rst launched its “brainboosting” bars. Though the brain health focused company fi rst made a detour into powdered beverages late last year, co-founder Chris “Bernie” Bernard said Mindright wanted to plant a deeper stake into the snack aisle.

“Year one was all about testing, making sure that the product fi t was viable and that customers were enjoying [the line],” Bernard said. “Now [we’re] staying in our lane with snacking and additives to support mood, energy and focus is the prime goal.”

Available in Chili Lime, Cinnamon Churro and Turmeric Ranch, the chips are sold on Mindright’s website and on Amazon with an MSRP of $4.99 per 4 oz. bag and 1.99 bag per 1 oz. bag. Along with a base of cassava fl our, potato fl akes and spices, the grain-free chips contain Mindright’s signature blend of nootropics including lion’s mane, vitamins B6 and B12, ginseng and L-theanine and are cooked in avocado oil.

While Bernard acknowledged the salty snack set is crowded, Mindright believes there’s still opportunity to launch cleaned up alternatives to conventional products. Consumers may not even fully grasp the functional benefi ts to start, cofounder Rob Dyrdek said – and that’s to be expected. The company hopes to fi rst lure in shoppers with attributes such as taste, and then use the functionality as a way to encourage repeat purchases.

“When we think about the product, a lot of people are going to discover it for the fi rst time when they see it…We call it ‘capture, compel, convert’ in the way that the packaging is designed,” Dyrdek said. “It’s really trying to draw you in and then give you the benefi ts that go along with having a really high quality product with infused nootropics and adaptogens.”

The brand plans to expand distribution outside of ecommerce and into specialty and natural retailers across California and the Pacifi c Northwest later this year and has commitments for 800 doors, Dyrdek said.

The focus on brick and mortar stores comes after a slight revision to its distribution strategy. According to Bernard, consumers are still largely discovering new products in store, rather than online. While the brand previously invested heavily in digital ads to send shoppers to its own website, it’s also reallocated some of that budget towards Amazon, which has proved to be a means of driving trial.

To support these marketing and sales costs, Dyrdek’s family offi ce, Dyrdek Machine, has invested another $1 million into the brand, bringing the company’s total funding since inception to $2.8 million.

Ultimately, the goal is to create a larger platform of products that span from morning to night, Bernard said. Other functional benefi ts such as sleep or beauty may come down the line, but right now brain health is the focus, in part because it’s easier to show an immediate effect, such as energy or focus.

“We’re a little bit ahead of [the trend] but nootropics are coming in a much bigger way,” Bernard said. “The data shows that these brands that are using these ingredients are continuing to grow at an exponential rate, and I think the market will catch up.”

Chamberlain Coffee Raises $7M to Support Omnichannel Growth

Chamberlain Coffee, the Los Angeles-based specialty coffee brand founded by YouTube sensation Emma Chamberlain, announced it has closed a $7 million funding round to fuel omnichannel business growth. The company had previously raised $1M during a seed round in 2020.

The round was led by venture builder Blazar Capital and Chamberlain herself, with participation from Ole & Steele/ Lagkagehuset founders Ole Kristoffersen and Steen Skallebaek, Grin founder Brandon Brown, D2C expert Nik Sharma and beverage industry veteran Ken Sadowsky.

“Chamberlain Coffee has grown exponentially since its inception, and this is only the beginning. In fi nding a group of investors for the brand who believe in and share our vision, we know Chamberlain Coffee will reach new heights and become the go-to coffee brand of this generation,” said Chamberlain Coffee CEO, Christopher Gallant, in a press release.

Founded in 2019 by YouTube star Emma Chamberlain, Chamberlain Coffee started off as a D2C brand that marketed a range of organic blends in whole bean, ground and steeped varieties. Since then, the business has grown into categories such as matcha, hot chocolate and chocolate covered espresso beans and into fl avored blends (Witty Fox Hazelnut and Fluffy Lamb Vanilla) while expanding beyond D2C into limited retail with partners including Sprouts, Bristol Farms and Erewhon and digital delivery market Gopuff.

With the new capital, the specialty coffee brand plans to grow its D2C —which accounts for 80% of its business — and retail presence even further.

Referencing Black Rifl e’s Q1 2022 earnings call, Gallant said that a lot of coffee brands are facing declines in their D2C sales and their primary focus moving forward is in the retail channel. As coffee is still largely purchased at grocery stores, Chamberlain Coffee emphasized the importance of an omnichannel approach.

“It’s really important, at any company, to meet your consumers where they want to buy your product, whether that be in retail, on Amazon, on your own website, in cafes and foodservice channels,” Gallant told NOSH.

Chamberlain Coffee will build up its retail and wholesale presence, starting with traditional and natural grocery stores, with hopes of reaching 250 doors by the end of the year.

“We’ll use the latest funding round for [growth] as we think about the fi nancials. I think all D2C businesses right now are taking a look at how expensive it is to acquire new consumers [in the] D2C space with all the changes that are happening across every platform,” said Gallant.

According to LinkedIn, the brand is also looking to fi ll several roles, including Marketing Manager, Chief Marketing Offi cer and Chief of Staff while still running relatively lean in the face of potential future headwinds.

“In just the general economy [...] often the mistake companies start to make is raising money around hiring a lot of people. But we do have a couple of key roles we need to fi ll,” said Gallant. “[Chamberlain Coffee] is looking for someone that has worked with food and beverage brands to deliver an omnichannel experience.” Recently, Chamberlain Coffee explored new opportunities in the RTD segment through partnerships with Swoon and Nutpods. In May, Chamberlain Coffee and Swoon launched Matcha Lemonade, a LTO available exclusively online in 12 oz. cans. In June, Nutpods and Chamberlain released a cobranded variety pack featuring “Emma’s favorite fl avors” – unsweetened French Vanilla, unsweetened Caramel and sweetened Sweet Crème – for $14.95. Gallant, who has a background in the RTD space, including stints at Aqua ViTea and Red Bull, told NOSH in May that the brand is “super excited” about its potential for a direct move into RTD products. However, said jump will not happen within the next year. Thus far, the brand has found its ‘sweet spot’ in single-serve products like sachets and will use the new capital to “develop new and innovative products to further its mission of being an innovator in the beverage space.” The brand has also seen success with its matcha powder, its strongest selling SKU, and recently added two new fl avor innovations – Vanilla and Mango – available online for $23 per 30g tin.

“To be able to grow this business, launch new products and work in this space every day is a dream come true. I am so thankful that we have been able to grow Chamberlain Coffee into the brand I dreamed it to be, and I can’t wait for what the future holds,” said Chamberlain in the release.

Luxury Brand Last Crumb Closes $3M Round To ‘Go on the Offensive’ & Enter Brick & Mortar

Luxury cookie company Last Crumb has closed a $3 million seed round which will help the direct-to-consumer company fund marketing and R&D and move into an “offensive” position ahead of its next growth phase.

The seed round, announced in July, was led by Electric Feel Ventures, the venture capital arm of entertainment management company Electric Feel Entertainment, with Chetrit Ventures, hospitality entrepreneur David Grutman, fashion executive Andrew Rosen and Venus ET Fleur founders Seema Bansal and Sunny Chadha also taking part. The company previously raised $1 million last year, just a few months before it began selling product.

“We were able to bring in existing people who’ve been with us from that first fundraise who saw that we did what we said we were going to do over the last nine months,” CEO Mathew Jung said. “Then we were really strategic in bringing on some new people that we thought could be really interesting, both for future expansion and … [who] could help from an advisory standpoint, as we think about what the evolution of Last Crumb is.”

Last Crumb offers a single product: a 12-pack of smallbatch, ultra-premium hand-made cookies that retails for $140. With flavors including Better Than S*x (a play on chocolate chip), Netflix and Crunch (cinnamon sugar) and Not Today Mr. Muffin Man (blueberry), each 4.5 oz cookie is designed to be indulgent and shareable. Its signature cookie boxes are available to purchase for only a few hours every Monday, and routinely sell out within hours.

The company has spent the last 14 months largely focused on making operational improvements, including moving into a larger Pasadena-based production facility and bringing on new staff. With its infrastructure revamped, Jung said the company is now ready to change gears and look to the future.

“If the last 18 months were a super pared-down, less-is-more approach … I would say we’re now entering a new phase,” Jung said. “Part of raising the money was [to go on the] offensive, to start to do [more outbound efforts and collaborations] and some of it was defensive, given the economy and everything that’s going on in the world.”

Last year the company began to dabble with one-time offers; its Black Friday Member’s Only subscription, which includes a box of 24 cookies every two months for a year – plus early access to new flavors and a collectable box – sold out at $1,000 each. This Valentine’s Day, the bakery launched its first limited edition box and assortment, a model the company plans to replicate for other holidays.

Ahead of the release of its second cookie collection later this year, Last Crumb has also in recent months done limited test drops for new varieties, such as Florida Man, a key lime

pie flavored cookie. These efforts, Jung said, are designed to further develop customer longevity and encourage repeat purchasing.

Having built a dedicated direct-to-consumer base, Jung said the company is approaching its retail launch cautiously. While collaborations with other brands or retailers have been considered, the current plan is to open luxury-oriented, Last Crumb-owned stores in the US at some point in the future, with Jung using Las Vegas as an example of a potential launch market in late 2023 or early 2024.

But neither reduced prices or a smaller pack size are on the docket, Jung said, as supply chain and production costs are only rising. Last Crumb’s core audience of high-income consumers are also seeing less financial impacts on their discretionary spending and aren’t asking for lower prices.

Jung hasn’t denied his interest in an eventual exit for Last Crumb, though he maintains that this may or may not mean an outright sale. While the past year has been about building the ops side of the business, the next is about growing sales and profitability, a goal he believes the company will hit in the next 90-160 days.

“While our goal, yes, has always been to be conservative with cash and to exit the business at some point. We also want to build a business … we aim to be profitable, we’re not trying to be a DTC loss leader,” Jung said.”We believe that we’re building something, regardless of selling it or keeping it or whatever, that will be here for a long, long time.”

Yumi Moves into Brick & Mortar to ‘Build a Healthier Generation’

E-commerce focused baby food brand Yumi is taking its fi rst step into brick-and-mortar retail through a national partnership with Target, the company announced in July.

The company had always planned to expand beyond digital sales into physical retail, according to Yumi co-founder, CMO and president Evelyn Rusli, but wanted to wait until it had more fully saturated the online market before making the jump. The wait also allowed the brand to test and iterate its core line of products, she added, as well as its value proposition.

Target is taking two lines: Superfood Veggie Organic Toddler Bars (MSRP $4.99) and Organic Meltable Puffs (MSRP $3.99). The former is available in Strawberry & Rhubarb, Blueberry & Purple Carrot, and Apple Cinnamon & Squash, while the latter comes in Apple & Broccoli, Strawberry Basil and Sweet Pea. Yumi will have dedicated 4-foot, in-aisle sets along with endcap displays in select Target stores.

“There’s so many different pathways to discover amazing products… so we always wanted to be where consumers are and where they can discover us,” Yumi co-founder, CMO and president Evelyn Rusli said. “Our mission is really to build a healthier generation and you don’t just build a healthier generation with a subset of the population [that’s online].”

To prepare for the expansion, Yumi raised $67 million last December, bringing its total funding close to $90 million since its inception in 2017. That capital helped fi nance new brokers as well as new sales and marketing team members.

Yumi’s packaging was also revised to better perform in a retail environment: Online, the products are displayed as single serve bars or cardboard tubes of puffs decorated with whimsical illustrations, Rusli said, but for Target, the brand is selling fi ve-count boxes of bars and plastic tubes of puffs with callouts regarding functional benefi ts and superfood ingredients.

“When you’re looking at brick and mortar and you have an end cap or you have just a piece of packaging, you have to make that design work really hard for your brand,” Rusli said of the changes.

Yumi plans to add more accounts over the next year. Still, the growth will be deliberate, Rusli said, because the company understands launching with Target is a large undertaking itself.

Though the company is best known for its line of globallyinspired, refrigerated baby food cups, partnering with Target meant shifting its focus to on-the-go snacking, Rusli said, because it felt like a more approachable introduction to the brand for a mass audience. There also was a clearer point of differentiation, she added, because the toddler and kids snack category is so heavily saturated with sugar-ladened options. Baby food isn’t off the table completely, but will not be an immediate focus.

The pickup of Yumi comes as retailers are responding to consumer interest in baby and toddler food options with simpler and more nutrient-dense ingredient decks. While this demand mirrors larger health and wellness trends, recent investigations into the toxins and heavy metals found in other baby food brands has also ramped up awareness.

In July, Target also picked up clean-label baby formula brand Bobbie. Meanwhile, organic chilled baby and children’s food brand Once Upon a Farm released its own line of frozen baby food meal starters to age up the brand and offer parents more complete meal solutions.

While Yumi may command a higher price point, like Bobbie, it also stresses transparency and community, making parents feel comfortable during an unsettling time.

“We are not just solving mealtime, we are helping parents feel confi dent in the food products that they feed their kids,” Rusli said. “But also helping parents feel like they got this and that they don’t have to worry. There’s actually a lot that you’re solving for psychologically and emotionally, for that parent and for that family.”

Night Shift Scales Back Production in Favor of Contract Brewing

Night Shift leadership told its 12 production employees work could dry up as early as late July, as the company prepares to wind down brewing and packaging operations at its Everett, Massachusetts location.

The company will shift to contract production at Framingham-based Jack’s Abby Craft Lagers and Pawtucket, Rhode Island-based Isle Brewers Guild (IBG), which had been producing about 50% of Night Shift’s volume.

“What we’ve told the production staff is like there might not be any work after today, but we are going to guarantee everybody’s paycheck till October 1, so two months,” co-founder Rob Burns said. “Then, if they have to sit at home, that’s what’s going to happen. After that, we’re still unsure because we’re reacting to this news and we wanted to be transparent and forthcoming to the staff and give them as much notice as soon as we knew.”

If employees are still sidelined by October 1, the company will offer them severance packages, Burns said.

Burns and co-founder Michael Oxton pointed to supply chain disruptions of carbon dioxide (CO2) as a driving force behind the immediate production pivot to other locations.

“CO2 is definitely a catalyst for this, or maybe the final straw in a lot of ways,” Burns said.

Since finding out in mid-July that its supply was about to be cut, Night Shift has called several other suppliers, only to be told that there is no CO2 available for purchase.

CO2 is used to move beer throughout the production process, to package it into cans and bottles and to push it through draft lines for taproom service. The beer industry dealt with a shortage during Summer 2020, when production of CO2 – often a byproduct of ethanol production – plummeted along with demand for gasoline.

This time, disruptions to other CO2 streams are causing the problem. Ammonia plants, which aid in fertilizer production and also give off CO2 to be captured, have been offline for offseason maintenance, according to Gasworld, which predicted a “long, hot summer ahead” for the U.S. CO2 market. In addition to that, a CO2 well in Mississippi is contaminated, Gasworld reported.

CO2 aside, Night Shift has struggled to mold the Everett location to meet its needs as a craft beer and hard seltzer producer, and has relied on off-site production.

“It’s been a problem-solving effort since we moved in, but really over the last three years investing dollars and ideas and schedules and all sorts of shifts to just like ‘How do we make this work?’ so that it’s optimized and it’s still not,” Oxton said.

The Everett brewery is “in a dense urban environment with limited land and small ceiling heights, and it is not designed to match the scale,” Burns said. Night Shift has expanded the facility several times since it opened in 2012. In the decade since, both Night Shift’s business and the craft beer industry have evolved at a near-breakneck pace.

“When we signed a lease here, we had brewed about 500 barrels of beer,” Burns said. “Nearly all of our beer went to 750 mL cork-and-cage or capped bottles. It was a different industry and we had a different product we were making, and now the No. 1 thing we sell is 12-packs.” For the past few years, about half of Night Shift’s volume has been produced at other locations, and the Everett brewery is on pace to produce 22,00025,000 barrels this year – a lot of volume to make in less-thanideal conditions, Burns said. “We have known for a long time that the Everett facility is not optimized as a major craft beer production plant,” he said. “Our plan to solve that was to build the Philadelphia brewery, and once that plan got canceled in spring of 2020 you could say that was the start of this snowball.

“We still, despite that, continue to spend money to make Everett more successful,” he continued. “We’ve spent $10 million in the production space since 2019 to try to increase the efficiencies and make it more capable for the scale production but despite all that, we’re just not able to get there.”

The Philadelphia brewery, announced in August 2019, would have provided 30,000 barrels of capacity immediately, with the ability to scale to 200,000 barrels over time. But the tumult the COVID-19 pandemic wrought upon the beer industry made the plan too risky, and Night Shift abandoned the plan in May 2020. Once the Philadelphia brewery was off the table, Night Shift signed a contract with Jack’s Abby to help with production.

In 2020, Night Shift’s volume only declined -2%, a loss that was recouped threefold with a +6% increase in 2021, according to the May/June issue of the Brewers Association’s (BA) New Brewer. Last year, Night Shift produced 38,840 barrels of beer, excluding its Hoot Hard Seltzer.

The company took a margin hit last September, when Night Shift Distributing shut down and Night Shift sold the rights to distribute its products in Massachusetts and Connecticut to Sheehan Family Companies.

Monster Reveals Plans for 6% ABV FMB Beast Unleashed

Allagash Adds First IPA ‘Hop Reach’ to Year-Round Lineup

Monster Beverage Company confi rmed its long-rumored entrance into beverage alcohol during its Q2 2022 earnings call, announcing that Monster Beast Unleashed, a four-SKU line of fl avored malt beverages (6% ABV) will launch in late Q4 2022 with the goal of being nationally distributed by the end of 2023. It will be the energy drink maker’s fi rst major alcoholic beverage launch since acquiring the CANarchy Craft Brewery Collective in early 2022.

Beast Unleashed will come in a 16 oz. single-serve can, as well as a 12-can variety pack in 12 oz. cans. The four fl avors will be

Allagash Brewing Company has resisted the urge to add an IPA trend for quite some time – at least within its core lineup – with growth driven by the success of its fl agship Allagash White Belgianstyle witbier. But next year, the Portland, Maine-based brewery is getting hoppy with the addition of Hop Reach IPA to its year-round offerings.

Hop Reach IPA – a 6.8% ABV “balanced, citrusy and tropical IPA, with a snap of bitterness,” – was developed over seven months by Allagash’s pilot team, and received more than 400 employee reviews. The offering is meant to be a “classic, timeless beer,” for both IPA lovers and consumers familiar with the Allagash brand.

Hop Reach will begin rolling out in January, with Allagash’s full footprint covered by mid-March, in time for spring retail resets. The IPA will be available in 16 oz. 4-packs, 12 oz. 6-packs and 12 oz. 12-packs of cans, varying by territory, as well as draft.

“We’ve designed it to complement Allagash White,” Naomi Neville, Allagash director of sales, said during a virtual tasting event with media members. “Allagash White is still by far our fl agship beer, It’s the beer that we started our business …this beer isn’t designed to take any focus or emphasis off the Allagash White brand. This is to sit next to it, to complement it, [and] give us a strong second brand in a very approachable style that a lot of people are familiar with.”

Allagash White is up +9% year-todate in IRI-tracked channels, with draft based on some of the brand’s “most well-known and popular fl avors,” Monster CEO and chairman Rodney Sacks said during the call.

“Beast Unleashed will leverage Monster’s brand equity while carving out its own unique space in the beverage-alcohol sector, and will be distinguishable from the many hot seltzer brands that have become so ubiquitous over the last several years.”

Sacks said the company’s alcohol innovation pipeline is “robust with a number of additional innovative product lines currently under development.”

up +27%, Neville said. In 2019, Allagash increased off-premise accounts for the brand by +35%, and increased “off-premise effective placements” by +74% compared to 2019, founder Rob Tod said in a November press briefi ng.

Allagash decided to add an IPA to its core lineup partially due to wholesalers asking for an IPA offering “for years,” Neville said. Last year, Allagash released Swiftly IPA as its spring seasonal, however, IPA remained a year-round gap in the company’s portfolio. A year later, Allagash expects Hop Reach to fi ll that gap and become the company’s No. 2 offering after Allagash White, passing Tripel, a Belgian-style golden ale.

“It is pretty much the fi rst question you get when people walk up is ‘What’s your hoppiest beer?’ or ‘Do you have an IPA?’” Neville said. “Finally we will be able to say ‘Yes, we’ve got this beer right here.’”

IPA is the best-selling style in the craft beer segment, accounting for 45.1% of all craft dollars at off-premise chain retailers year-to-date through July 10, according to IRI. In that period, IPA has earned $1.13 billion. Although the style’s dollar sales have declined -4.3% compared to last year, its dollar share has increased +1.3%, far more than any other style in the segment. The next largest craft style is, coincidentally, Belgian wits.

Hop Reach is not a hazy IPA, despite the subsegment driving IPA sales in IRI-tracked channels. The decision was made to prioritize aroma and fl avor over appearance, as Allagash made sure to make an IPA entrant that was still inherently an “Allagash beer,” Allagash brewmaster Jason Perkins said.

“It’s based on not blindly ignoring what’s happening in the trade, but very much based on things that we want to do,” Perkins said. “We wanted to make a beer that we hope resonated for many years to come. Something you could see yourself drinking a few years from now.

“We’ve never been trend followers per-se here,” he continued. “This was no exception. We were focused on trying to make the best beer we could, and not necessarily following what trend was out there.”

Ball to Close 2 Can Manufacturing Plants; Delays Construction of a 3rd

Ball Corp. plans to permanently close can manufacturing facilities in Phoenix, Arizona, and St. Paul, Minnesota, and delay construction of a new plant in North Las Vegas, Nevada, the Westminster, Colorado-headquartered company announced during its second quarter fi nancial results.

Ball, the world’s largest manufacturer of can packaging, said the plans to cease operations at the two facilities and delay building a third were “in response to the deceleration in customer demand late in the second quarter” and “to address localized supply-demand imbalances.”

The company did not indicate how many employees would be affected by the closures.

According to Ball president and CEO Daniel Fisher, the two landlocked, three-line facilities were built in the late 1960s and mid-1970s and had a net capacity of about 4 billion units.

Ball CFO Scott Morrison indicated that one of the facilities will likely close in the back half of 2022, while the other would close “early next year.”

Ball operates 15 other can manufacturing and can end production plants in the U.S., according to its website. The move to shutter two facilities follows actions taken by the company to rightsize its customer base by increasing the order quantity for printed cans to 1 million per SKU.

Ball leaders seemed to put the decision to close the plants at the feet of its customers, who they said have taken price increases over the last year in excess of infl ationary cost pressures. Fisher said the pricing behavior of its customers has occurred each quarter over the last four quarters, with its customers raising prices by 7% on average.

“So you’re getting to a point now where year over year, you’re looking at 20%, almost 30% price increases in some of these products,” Fisher said. “That absolutely has an impact on discretionary and consumer buying. And we’re looking at that and we’re making adjustments, we’re optimizing our footprint. This is a near-term balance for us.”

Fisher highlighted that total alcohol was down -3% in the second quarter, “mostly driven by domestic beer.” Non-alcoholic beverages were “a bit more resilient,” he said, with carbonated soft drinks and energy drinks growing and total non-alc beverages up +1%.

Morrison said Ball was “building inventories for what we thought would be a more robust season here in North America that didn’t show up.”

Fisher, in his prepared remarks, stressed that “cans continue to win in the fastest growing beverage categories and underlying demand for aluminum packaging continues to be resilient, despite retail shelf price increases by our customers ranging as high as 20%.”

“Early indications are that North American customers will continue to emphasize price over volume during the second half of 2022,” he added.

Fisher called on Ball’s customers “to return to a semblance of pricing strategy, which they’ve implied and implored over decades,” instead of “pushing forth price in excess of infl ationary costs” and “margining on that.”

“If there’s a modicum of return to a different pricing strategy, we will benefi t from that in terms of an uptick in volume in North America,” he added.

Decisions by Ball’s customers to increase price has led the company to back away from double-digit growth projections in North America, Fisher added. In spite of “economic challenges” this year, he said Ball globally would deliver 5% growth in 2022.

Asked about the North American can market which had been sold out, Fisher said “a confl uence of events” are happening and in the near term, “there could be slack capacity for the near term” due to Ball ramping up “large asset bases” in Pittston, Pennsylvania, and Glendale, Arizona, and investments in canning lines that have increased effi ciency.

Judge Affirms $56 Million Jury Verdict in Stone Brewing Trademark Infringement Case

A federal judge has denied Molson Coors’ attempt to toss a $56 million jury award to Stone Brewing in the San Diego craft brewery’s trademark infringement lawsuit over the 2017 refresh of Keystone Light packaging.

Judge Roger T. Benitez wrote that although he disagreed with several of the jury’s fi ndings, he would “not second guess” their March 25 decision. As such, Benitez denied Molson Coors’ motions for judgment as a matter of law, affi rmative defenses and declaratory judgments.

Throughout his order, Benitez made a point of agreeing with several of Molson Coors’ positions. Nevertheless, he concluded that “this court’s disagreement with the jury’s ultimate conclusion cannot give rise to a judgment as a matter of law against Stone.”

“Here, because the jury’s verdict is supported by evidence on the record, the Court fi nds it to be reasonable,” he added in denying Molson Coors’ motion for judgment as a matter of law.

Although the judge noted that Molson Coors’ attorney “presented strong evidence,” including “testimony that showed the structural fl aws” of Stone’s surveys, Benitez wrote that the jury found the survey evidence “convincing enough to fi nd a likelihood of confusion.”

“The court will not second guess this determination,” he wrote.