Functional hydration brand Pond is entering a new growth phase that will quadruple its retail presence starting in 2021, assemble its leadership team and close $5.6 million in Series A funding.
It’s been a hot minute since TechCrunch got into the product — about three years, in fact — and it’s carving out a niche in the $10 billion functional beverage market, which founder and CEO Lauren Picasso told TechCrunch has “exploded” over the past 12 years. months.
Picasso is mostly for consumer behavior with more environmentally friendly products, including the use of powders and ready-to-drink liquids, which are heavier and bulkier to ship.
Hydration isn’t a new concept (who could forget the real thing?), but consumers looking for healthier options, in turn, have created a more competitive landscape in recent years.
Picasso describes Cure as “the only female-founded electrolyte brand” and notes that its biggest competitor is Liquid IV, which was acquired by Unilever in 2020. He also said, “Legacy players are doing very well because many new players have entered the market” in the past few years. Some other functional beverage startups are also venture-backed. For example, Hydrant, also in Hydration, Olipop and Poppy in Soda Space and The Ryl Company in Tea.
To further differentiate itself from the plethora of wetsuit options, Pond has gone through a rebrand in 2022 to focus more on its products. For example, coconut water uses powder and pink Himalayan salt, while other drink mix companies use cane sugar, dextrose, high-fructose corn syrup, and synthetic and artificial ingredients, Picasso said.
“We wanted to reinvent and better communicate pure and herbal ingredients,” added Picasso. We feel like products like Liquid IV are effective, but we’re using much better ingredients. There’s a really clear point of differentiation, and because of that, we’re starting to attract more diverse consumers than any of our competitors. Our product tends to sway the most discerning woman, and the most active health conscious consumer.
In the year Since launching in 2019, Cure has grown an average of 230% in revenue annually and will expand its retail footprint from 4,000 stores in 2021 to 15,000 in 2023, Picasso said.
The company’s products are already in CVS and Walgreens, but now they will be in retailers, including Sprouts, Albertsons, Kroger, Stop & Shop, Wegmans and HEB. In total, there are nine flavors, four of which are new: Lemon and Orange launched in 2022 and Lemon and Strawberry Kiwi this year.
As Pond accelerates its retail presence, it continues to make about 60% penetration in e-commerce, and in the first quarter of 2023, growth is 121% higher than last year’s quarter, all with just nine full-time employees, Picasso said. .
In the year Cure’s $5.6 million Series A funding, which closed in March after securing $2.6 million in seed funding in 2020, gives the company a total of $8.2 million in venture-backed capital. With the new capital, the company, Picasso’s pool price is now 2x higher than the previous round.
Series A was planned, Picasso said, “This will be our last round. From here, we will work towards profitability, aiming to be profitable in early 2024.
Lehrer Hippe, who led Kure’s seed round, returns to lead the new investment and is joined by a group of new and existing investors including Valleder Partners, Simple Foods Ventures, Grand Oaks Venture Capital, Joyance Partners, Silas Capital and Kim Clijsters.
Cure intends to invest the new capital in rapid retail expansion, growing its management team, acquiring new customers and developing new products, including the bulk pot option that subscribers have been asking for.
As for its leadership team, the company recently hired Laura Kendrick, formerly of SmartyPants, and Stacey Gillespie, formerly vice president of innovation at Gaia Herbs, to help with distribution and overall revenue.
Cure has been successful in recruiting 700 influencers through its ambassador program, while Picasso brought in Kendrick to “really help balance the brand,” while Gillespie will drive the company’s product development and expansion into other functional categories. For example energy and health.
“We were looking for someone who could scale all these different marketing channels and drive the product strategy forward,” Picasso said. “Meanwhile, Stacey is an industry veteran who has brought 1,500 new products to market in her career.”
To that end, Pond’s products have hit the shelves of several new retailers in the past four months and doubled its footprint at CVS. He is now working on some new products that will open in the next year or so, Picasso said.
“We have a lot of retail expansion planned, so the next couple of years will be about executing through these doors and coming up with a marketing playbook to be successful in stores,” she added.
Editor’s note: Cure, which stated a valuation of $22 million during the interview, declined to comment further, although the current valuation is now higher.