Matt Matros

Roundup of All Things CPG This Week: (Follow for weekly roundups like these every Friday) 💼 Mergers & Acquisitions → Kirin Completes Fancl Buyout: Kirin finalizes the purchase of Fancl for $1.4B, continuing its strategic shift from beer (WSJ). → Newport Craft Distilling Acquires KEEL Vodka: Newport Craft adds KEEL Vodka to its portfolio (PR Newswire). → Walmart Acquires Vizio: Walmart buys Vizio for $2.3B, expanding into electronics (Intellizence). → Paramount Global Merges with Skydance: Paramount Global partners with Skydance in a $22.26B deal (Inside Arbitrage). 💰 Fundraising Highlights → Funding for UK’s Common Beverage: Secures six-figure investment led by James Watt (The Drinks Business). → InvestBev’s Ambitious Goal: Launches its fifth fund, aiming to raise $150M for beverage brands (Axios). → Emma Watson’s Renais Gin: Raises $2.3M to fuel growth in the luxury gin market (SEC). → ZeroFox Holdings Raises Funds: Secures investment from Haveli Investments to enhance digital risk protection services (Stock Analysis). → Agiliti Secures Funding: Thomas H. Lee Partners invest in Agiliti for growth in medical equipment services (Stock Analysis). 💄 Apparel, Cosmetics, and Wellness Updates → Briogeo Expands Product Line: Introduces new hair styling products at Ulta and Sephora (Glossy). → Unilever Prestige CEO Resigns: Vasiliki Petrou resigns to start a new investment fund (Business of Fashion). → Care/of Closes Operations: The personalized vitamin brand shuts down (Twitter). → Goop Launches Mascara: Gwyneth Paltrow’s brand expands its makeup line with a new mascara (WWD). → GlaxoSmithKline Acquires Aiolos Bio: GSK enhances its respiratory care portfolio (Stock Analysis). → Amgen Launches New Wellness Initiative: Focuses on personalized health and wellness products (Inside Arbitrage). 🍽️ Food, Beverage, and Alcohol News → Liquid Death’s New “Death Dust”: Enhanced flavors now available on Amazon (Instagram). → SCiFi Foods Shuts Down: Cultivated meat startup ceases operations after raising $40M (AgFunder). → DAVIDsTEA Introduces Sparkling Iced Teas: Launches its first ready-to-drink product (Instagram). → Mondelez Collaborates with Lotus Bakeries: New cookie and chocolate products in the works (Food Dive). → Top of the Mornin’ Coffee’s New Flavor: Introduces French Toast Flavored Coffee (Instagram). → Hulk Hogan’s Beer Launch: Debuts Real American Beer (Brewbound). 📊 Data and Distribution Developments → MERIT’s Financial Success: On track to reach $100M in sales this year (Business of Fashion). → Verb Energy Debuts at Earth Fare: Available in Earth Fare stores. → Burnt Faith Brandy at Tesco: Expands to the UK market. → Pioneer Natural Resources Partners with ExxonMobil: Focuses on sustainable energy solutions (Stock Analysis). → Alpine Immune Sciences Teams with Vertex: Enhances its immunotherapy offerings (Stock Analysis). Enjoyed this? Follow James Ball for roundups every Friday.

1

The Long Drink Company is on fire right now... The most recent RTD alc-bev brand to break $100m in retail sales, Long Drink has been on a growth tear since entering the US market in 2018. Jay-Z has taken notice. Marcy Venture Partners (Jay's VC firm) just announced an undisclosed but 'significant' investment in Long Drink, adding the brand to its portfolio of CPGs which now includes Partake Foods, Savage x Fenty, and Maker Wine. The Marcy investment comes on the heels of a $25m funding round in 2021 featuring several high-profile backers like actor Miles Teller, DJ Kygo, and Rickie Fowler. Quite the crew of influential investment partners. So why is everyone so bullish on Long Drink? Here's what stands out: --- 1 / Unique Product The Traditional Long Drink is a gin-based cocktail blended with grapefruit and juniper berry flavors. Gin as the alcohol base separates Long Drink from the vast majority of competitors in the RTD market which leans towards vodka, tequila, and malt. 2 / Marketing Prowess Long Drink has a fascinating history dating back to the 1952 Olympics in Helsinki. The Finnish government actually commissioned the creation of the drink to satiate the millions of visitors attending the games. It was a smash hit. The brand has done an excellent job blending that nostalgic story with modern day sports marketing tactics, tapping into professional athletes like Finnish F1 driver Kimi Raikkonen and golfer Justin Thomas. 3 / Distribution Focus Now available nationwide, Long Drink started by taking a scaled approach to the US market with a focus on select markets. 2021 marked a key turning point when the brand struck a partnership with Southern Glazer's Wine & Spirits, one of the top distributors in the industry. --- $100m ✅ $200m ❓ We'll see. As a betting man I'd take the under on the timeline to $200m. Regardless, what a great success story. Congrats to the team Brady Evan Burns Sakari Manninen! h/t Numerator for the insights 🙌 #cpg #alcohol #gin #RTD #cocktail

688

57 Comments

Papa Johns $PZZA just released their Q2 2024 earnings report, and it's a slice of reality in a competitive market 🍕. Revenue dropped due to economic pressures, but Papa John's is implementing strategies to tackle those challenges head-on. The company is focused on international restructuring and investing heavily in digital technologies to meet evolving customer preferences. They're also emphasizing operational efficiency and customer-centric initiatives. Despite the headwinds, Papa Johns remains optimistic about their long-term growth strategy. Will they succeed in navigating the current climate? Read More ➡️ https://lnkd.in/gc9Q37bz #PapaJohns #PZZA #Q2Earnings #Pizza #RestaurantIndustry

1

1 Comment

🚀 The rise of functional beverages is more than just a trend—it's a movement reshaping how we think about what we drink. 📖 Great piece by Keren Landman at Vox on why the better-for-you beverage category is surging, with the market set to surpass $200 billion by 2027. Millennials are leading the charge, consuming these beverages at twice the rate of other age groups.   🌱 This is just the beginning. The rapid innovation and demand we’re seeing are a testament to consumers seeking healthier, more mindful alternatives to traditional drinks.   🌵 We look forward to continuing to pave our own unique path forward for MAGIC CACTUS and provide consumers with a refreshing, healthier beverage that can be enjoyed by a broad base of drinkers nationwide. ✨   Link to full article below:

39

1 Comment

It's no longer just elite athletes who care about sports nutrition. Everyday consumers are paying more attention as health becomes further ingrained in the public consciousness. To succeed in this changing market, brands need to realize that these consumers aren't training for marathons or peak athleticism — they just want to be active and healthy. Creating products that cater to this desire is key to capturing this segment, and Prinova's product development team makes it easy. #NutritionTrends #SportsNutrition #ConsumerTrends #WeArePrinova #PrinovaGlobal

20

Great time with Elanie and Kay from the Renegade Nutrition Podcast! Their content is always so timely related to changes in the science of nutrition, it's impact on our wellness, and how we can all be better at 'biohacking'. We discussed the importance of polyphenols in the diet for longevity, data from blue zones, and Goode Health. Give it a listen (if you have an hour or listen at 1.75x speed) and follow Renegade!

19

Sprouts Farmers Market just reported Q3 comp store growth +8.4%, a significant acceleration on top of 3.9% in the prior year. Further they guided the street to +8% to 10% in Q4. Those are crazy comps for such a big established chain. Premium food & beverage CPG consumer demand is ripping right now for #wellness and better-for-you positioned brands and products, same theme shown in underlying UNFI earnings last Q. The trends are showing up everywhere, consistent, and accelerating, especially over the last 18 months. Sector outlook remains incredibly strong IMO. If your brand is struggling right now, it's not the consumer, it's something else.

397

49 Comments

The non-alcoholic drinks market continues to grow and grow (and mature). Check out recent insights + stats from our friends at Grüvi: March Off Premise Retail Sales: → $48.6M > Identical to February, up 23% YoY → You can see subcategory performance in the chart below. Gruvi predicts: → 30-35% of YoY NA category growth. → 25%+ in off-prem and 50%+ in on-prem. → Premium, high quality craft or import NA beers will capture most of the growth of the NA beer market. → Big bet on NA RTDs to surpass NA wines by end of year. Gruvi has some more great stats in their blog post (link in comments). I’m hearing this same type of growth from members of the Adult Non-Alcoholic Beverage Association (ANBA). There's been some questioning about the growth of the category because of the recent Chapter 11 bankruptcy by non-alc beverage retailer Boisson and the closing of their retail locations. I was going to share some thoughts on this but the Gruvi team summed it up well: “Having served as a supply partner for Boisson, and being intimately familiar with their retail locations, it became apparent that they faced challenges across their retail and e-commerce channels. Boisson positioned itself as the upscale destination for NA beverages, boasting premium locations and a curated assortment. However, despite the overall growth in the NA market, it remains predominantly composed of NA beer (80%) and NA wines/RTDs under $12 (10%). As larger retailers expanded their NA offerings to target the mainstream consumer—the 90% of the market as seen above - Boisson was left with a small addressable market. Unfortunately, the demand proved insufficient for Boisson to sustain its operations.” Andrea Hernández also has a great take on it in her most recent Snaxshot (link in the comments). The adult NA category is maturing. Brands that do not have good business models, have bad product-market, or average quality products will need to adapt or close their doors. And this is not a bad thing. Because what rises out of this are business and products that better serve the consumer. I’m always impressed by the continued release of higher and higher quality NA products, with each raising the bar for the category. And this is great for people looking to moderate or not drink alcohol for whatever reason, and in whatever situation that best suits them. The adult NA category is getting bigger and better each day. And ANBA, our members, and I are here to continue to create a world where everyone has access to great tasting adult non-alcoholic beverages to enjoy in every social situation. And that is something we can all celebrate! 🍾 🥂 🍻 You can join us in growing the category and this movement by visiting ANBA's website and signing up for a soon to launch newsletter (link in comments). And you can follow me, Marcos Salazar 🍺🍷🥃, (& click the bell under my profile banner) to get regular insights and news about NA drinks. ♻️ #Repost if you like this post :-)

147

22 Comments

Are you in CPG? 𝗡𝗲𝘃𝗲𝗿 𝗯𝗿𝗲𝗮𝗸 𝘁𝗵𝗶𝘀 𝗚𝗼𝗹𝗱𝗲𝗻 𝗥𝘂𝗹𝗲! 𝗬𝗼𝘂 𝗵𝗮𝘃𝗲 𝘆𝗼𝘂𝗿 𝗳𝗼𝗿𝗺𝘂𝗹𝗮 𝗿𝗲𝗮𝗱𝘆. 𝗧𝗵𝗲 𝗽𝗮𝗰𝗸𝗮𝗴𝗶𝗻𝗴 𝗹𝗼𝗼𝗸𝘀 𝗳𝗮𝗻𝘁𝗮𝘀𝘁𝗶𝗰. 𝗘𝘃𝗲𝗿𝘆𝘁𝗵𝗶𝗻𝗴 𝗶𝘀 𝗽𝗿𝗲𝗽𝗮𝗿𝗲𝗱 𝘁𝗼 𝘀𝘁𝗮𝗿𝘁 𝗺𝗮𝗻𝘂𝗳𝗮𝗰𝘁𝘂𝗿𝗶𝗻𝗴... STOP NOW!!! Before entering manufacturing, you must follow one golden rule: 𝗔𝗹𝘄𝗮𝘆𝘀 𝗽𝗿𝗼𝗱𝘂𝗰𝗲 𝗯𝗲𝗹𝗼𝘄 𝘁𝗵𝗲 𝗺𝗶𝗻𝗶𝗺𝘂𝗺 𝗼𝗿𝗱𝗲𝗿 𝗾𝘂𝗮𝗻𝘁𝗶𝘁𝘆 (𝗠𝗢𝗤). If the MOQ is 10k units, negotiate to make just 5k or fewer. No matter how thoroughly you prepare, I can almost guarantee there will be issues with your first batch. In the worst-case scenario, the product could have a defect that makes it unsellable. Even in the best-case scenario, you might need to make changes to your label. And the absolute worst-case scenario is that the product doesn't sell 🫣 𝗡𝗼𝘄, 𝗹𝗲𝘁 𝗺𝗲 𝘀𝗵𝗮𝗿𝗲 𝗮 𝘁𝗮𝗰𝘁𝗶𝗰 𝘁𝗵𝗮𝘁 𝘄𝗶𝗹𝗹 𝘀𝗮𝘃𝗲 𝘆𝗼𝘂 𝗧𝗛𝗢𝗨𝗦𝗔𝗡𝗗𝗦: Most manufacturers set their MOQs based on the volume of their tanks. Ask them to produce the full MOQ but only use a fraction to fill finished product, keeping the rest in bulk for later. This strategy saves you money on packaging, filling, and labeling upfront. Taking this cautious approach minimizes risk and prevents potential costly mistakes with your first batch. Always play it safe and avoid unnecessary risks with your initial production run. 𝗦𝘂𝗯𝘀𝗰𝗿𝗶𝗯𝗲 𝘁𝗼 𝗺𝘆 𝗻𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿 𝗮𝘁 jackbenzaquen.com

16

7 Comments

Whether you are an avid golfer, runner, pickleball player, or participate in any other active sport, you know that taking care of your body is the key to long lasting and engaged performance. Our consumers continue to choose Entourus salves for both pre and post workout and anytime they are physically active, to lend a helping hand. Our latest blog for the month of June details how to best use CBD muscle cream, how frequently to apply, and how to establish the right dosage for you!

12

The surge in non-alcoholic beer sales has been amazing to watch over the last year or two, and reflects the incredible growth that we have seen in NA spirits at Ritual Zero Proof. While it feels as if there has been more media focus than ever on the NA market, we are still at the beginning of a broader movement towards mindful drinking, with high quality non-alcoholic options readily available and sought after. It’s an exciting time for the entire sector, and the latest investment in Athletic Brewing Co. is another indicator of the momentum we are building collectively as an industry. The growth of the non-alcoholic beverage sector is more than a trend—it’s a cultural shift. Consumers are not just looking to cut back on alcohol; they are actively looking for a healthier, more mindful lifestyle. They want to have great experiences with friends, and they want to feel good the next day. That’s what Ritual, Athletic and other brands are working on as we shape and meet the demands of new generations of consumers. Bill Shufelt at Athletic Brewing is pioneering the non-alcoholic beer sector in the same way that we are doing for spirits at Ritual. I couldn’t be more thrilled for him and the team at their new investment. A rising tide lifts all boats. Investors are excited about the potential for this market, and that’s good for companies such as ours – but it’s also good for consumers who want more choice, better products and deeper availability. The future of mindful drinking is here, and it’s only going to get brighter.

111

7 Comments

There's a subtle but HUGELY important trend playing out in CPG that may have ripple effects across the entire industry: Modern consumers are starting to care less about legacy brands. This article was specifically about Kraft Mac & Cheese, but I think it's indicative of a wider trend happening across the CPG landscape, and in alcohol in particular. Many multi-national, household name brands don't carry the same weight with consumers that they did even five or ten years ago. So, what does this mean & what are the implications? Well, it has lots of implications but two things I feel strongly are true: 1. This is a particularly interesting time to be launching and scaling challenger CPG brands 2. Big CPG conglomerates will need to get aggressive in shaking up their portfolios Going to be an exciting and interesting few years in the space!

28

13 Comments

The Alcohol Industry "Reset" of 2023/2024. Some of my thoughts on current market and what we might expect in 2025 👇

52

13 Comments

An accurate take on the evolution of consumers and brand building strategies… The acceleration of FMCG/CPG startups is definitely changing the landscape and the Legacy brands will be facing a ‘change or die’ juncture! #FMCG #CPG #Consumer #Brand #Homegrown #Change

20

1 Comment

Keurig Dr Pepper to acquire GHOST lifestyle for $1.6 BILLION 🤑 Ghost sales have quadrupled over the last 3 years after launching a joint venture with ZX ventures (Anheuser Busch) to launch the brand into energy in 2020. Let's break down the deal👇👇 1/ First, a brief history on GHOST Founded in 2016 by Dan Lourenco & Ryan Hughes & based in Chicago (shoutout!), GHOST was the original ‘label transparency’ pioneer that differentiated it. I think of the brand as somewhere between gym shark & liquid death. GHOST did not raise much money until 2020 when it launched a joint venture with ZX ventures (AB-Inbev). The partnership with AB was a joint venture, and purposeful to launch GHOST into the energy category. Unclear the valuation at that point but my checks say 10 figures. 2/ Deal Structure There are two bites here. First, KDP will buy 60% for $990m in cash - a $1.6B valuation / 3x FY24 sales In the second part of the transaction, KDP will buy the remaining 40% in 2028 at a valuation that has already been decided depending on 2027 financials 3/ Comps Valuation - this is the largest private bev M&A in recent history. I've been tracking headline M&A in a database since 1/1/2023, and this one dwarfs the rest in beverage: 👻 Ghost - $1.6B ☕ La Colombe - $900m ⚡ Bang Energy - $362m 💪 OWYN - $280m Revenue - Ghost is the most scaled private & independent asset in energy outisde Red Bull. KDP told us the valuation was 3x FY24 sales, imputing ghost has $530m. I describe a 3x sales multiple in the category as 'good not great' as there are a handful of recent precedent transactions that have a higher multiple: 🥜 Nutpods - 4x 🏺 Humm Kombucha - 3.75x 🌡 Celsius currently trading around 4.4x The 'good' sales multiple leads me to believe that Ghost also commanded a 'good' ebitda multiple - which would be around 13x in my comp set. This would imply that Ghost had very strong EBITDA margins in excess of 20% after KDP accounted for synergies/addbacks 4/ Time to Value (IRR) 1 thing that has stood out recently is the age of the businesses being acquired. GHOST was founded in 2016, 8 years ago - this is an outlier for a transaction of this size. HUGE time to value. OWYN was around the same age and was acquired for $280m - a huge success in its own right that gives you some reference for just how well Ghost has done. 🛀 Aesop - $2.5B / 36 yrs 🚬 NJOY - $2.7B / 17 yrs ☕ La Colombe - $900m / 29 yrs -- I'll be going deeper into the deal & providing the data/comps I used to make this analysis, + my notes from the earnings call in my newsletter going out tm Yes I woke up to listen to the earnings call, so please subscribe to my newsletter at the link pinned to my profile 🙂

121

10 Comments

Check out this insightful interview with Richard Schenkel in the latest Food Service Director Online podcast episode. A quick and interesting listen!

4

General Mills splurges $1.5bn to strengthen its (very successful) Pet Food division wit a Whitebridge Pet Brands acquisition GenMills continue to progress its Accelerate strategy that saw the disposal of its yogurt business in Europe & NA at a time it is over-exposed to categories/ countries that display the most volume growth slowdown in the entire FMCG industry (Core Food/ US) This deal is their 5th deal on Pet Food that led them to become #3 Pet Food player in the US =>Blue Buffalo (2018) =>Nudges, Top Chews, and True Chews (2021) =>Fera Pets (2023) =>Edgard & Cooper (2024) Whitebridge is a $325m revenue cat food & pet treat US business, it complements nicely their current portfolio 𝐀𝐬 𝐩𝐫𝐞𝐝𝐢𝐜𝐭𝐞𝐝 𝐚𝐭 𝐭𝐡𝐞 𝐛𝐞𝐠𝐢𝐧𝐧𝐢𝐧𝐠 𝐨𝐟 𝐭𝐡𝐞 𝐲𝐞𝐚𝐫, 𝐰𝐞 𝐚𝐫𝐞 𝐜𝐮𝐫𝐫𝐞𝐧𝐭𝐥𝐲 𝐰𝐢𝐭𝐧𝐞𝐬𝐬𝐢𝐧𝐠 𝐢𝐧 𝐭𝐡𝐢𝐬 𝐇𝟐 𝟐𝟎𝟐𝟒 𝐚𝐧 𝐚𝐜𝐜𝐞𝐥𝐞𝐫𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐚 𝐯𝐞𝐫𝐲 𝐬𝐩𝐞𝐜𝐢𝐟𝐢𝐜 𝐭𝐲𝐩𝐞 𝐨𝐟 𝐌&𝐀 𝐭𝐫𝐚𝐧𝐬𝐚𝐜𝐭𝐢𝐨𝐧𝐬, 𝐭𝐡𝐞 𝐨𝐧𝐞 𝐭𝐡𝐚𝐭 𝐡𝐚𝐯𝐞 𝐝𝐢𝐬𝐩𝐥𝐚𝐲𝐞𝐝 𝐨𝐯𝐞𝐫 𝐭𝐡𝐞 𝐥𝐚𝐬𝐭 𝐝𝐞𝐜𝐚𝐝𝐞 𝐭𝐡𝐞 𝐡𝐢𝐠𝐡𝐞𝐬𝐭 𝐌&𝐀 𝐑𝐎𝐈 (cf. our last year publication on FMCG M&A Winners & Losers - https://lnkd.in/eXUfjHxN): - Mostly mid-size growth assets ($0.5-5bn EV that have a brand growth model proven enough to be scaled but with still a lot of growth left) - On existing categories in large existing markets - Ready to benefit from the acquirer's GTM synergies to accelerate scale-up 𝐄𝐱𝐜𝐢𝐭𝐢𝐧𝐠 𝐭𝐢𝐦𝐞𝐬 𝐟𝐨𝐫 𝐌&𝐀 𝐢𝐧 𝐭𝐡𝐞 𝐅𝐌𝐂𝐆 𝐢𝐧𝐝𝐮𝐬𝐭𝐫𝐲 #fmcg #cpg 𝗧𝗼 𝗴𝗲𝘁 𝗮𝗹𝗹 𝗼𝘂𝗿 𝗶𝗻𝘀𝗶𝗴𝗵𝘁𝘀, 𝗳𝗼𝗹𝗹𝗼𝘄 𝘂𝘀 & 𝘀𝘂𝗯𝘀𝗰𝗿𝗶𝗯𝗲 𝘁𝗼 𝗼𝘂𝗿 𝗙𝗠𝗖𝗚 𝗖𝗘𝗢 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀 𝗻𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿: https://lnkd.in/ea4gy65y 𝗔𝗯𝗼𝘂𝘁 𝘂𝘀: FF&A solves the most complex strategic problems of the world largest FMCG companies across Corporate Strategy, Organic Growth, Digital RTM (Ecommerce, DTC, EB2B) and M&A. 14 out of the world 20 largest FMCG companies are repeat Clients (more on FF&A website: https://lnkd.in/dc6jY4Qp)

18

1 Comment