Magic Spoon, the maker of better-for-you cereals, secured $85 million in Sequence B funding as three of its manufacturers make the bounce from direct-to-consumer-only choices to Goal retailer cabinets for the primary time.
HighPost Capital led the brand new spherical, which brings Magic Spoon’s whole funding thus far to $100 million. HighPost is joined by Siddhi Capital, Coefficient Capital, Constellation Capital, Carter Comstock and a bevy of celeb buyers, together with Shakira, Russell Westbrook, Halsey, The Chainsmokers, Amy Schumer, Odell Beckham Jr. and Nas.
Co-founders Gabi Lewis and Greg Sewitz began New York-based Magic Spoon in 2019, creating cereal flavors like Fruity, Cocoa and Peanut Butter, however with higher substances, zero added sugar, excessive protein and low carbs, in addition to gluten free and keto-friendly.
These three flavors are the primary amongst Magic Spoon’s eight flavors to enter 1,300 Goal areas starting Monday.
The pair declined to share exhausting numbers to help the corporate’s progress, however did say that Magic Spoon’s merchandise have reached greater than 1 million prospects prior to now three years.
And, whereas it has principally been a direct-to-consumer model, Lewis says including retail was a part of the plan all alongside.
“The plan was to develop the enterprise as quick as we will and layer in new issues over time,” Lewis advised TechCrunch. “We needed to do one factor at a time, do it effectively after which transfer on to the subsequent one. We began with our web site, then Amazon, with the aim of layering on extra channels to develop in new and alternative ways. Now we’re able to lean into retail and go onto cabinets.”
Actually, Lewis and Sewitz have all the time deliberate to launch merchandise away from the cereal field. Sewitz mentioned he couldn’t go into extra element right now as to what different merchandise are within the pipeline, however Magic Spoon has a line of limited-edition cereal bars, which is able to develop into everlasting members of the product line this month.
Magic Spoon co-founders Gabi Lewis and Greg Sewitz. Picture Credit: Magic Spoon
Magic Spoon isn’t alone in tackling a more healthy model of breakfast. They’re amongst corporations like OffLimits and Crispy Fantasy in cereal and Kreatures of Habit and Yishi within the oatmeal house. Some have additionally wolfed up enterprise capital {dollars} as they seize a chunk of a breakfast cereals market poised to be valued at $51 billion by 2028.
When requested who they suppose their rivals are, Lewis and Sewitz say they don’t technically consider themselves as competing in opposition to simply cereal manufacturers, however with breakfast and snack manufacturers, as an entire, for the suitable to be on the kitchen desk.
The brand new capital injection positions Magic Spoon as “very effectively capitalized with its retail launch,” Sewitz mentioned. He famous that investments can be made in progress and including expertise to scale up round logistics, customer support and progress advertising as the corporate balances each DTC and retail.
The corporate at the moment has 41 staff, up from 20 a yr in the past, and has about a dozen open jobs on its web site. With the enlargement of its gross sales channels, it made the transfer to herald Rachelle Lynch as head of gross sales in March to guide that division and work alongside the digital group to construct that enterprise, Lewis mentioned. Lynch beforehand held gross sales roles at Mason Dixie Meals, Hu Merchandise and Jeni’s Splendid Ice Lotions, according to her LinkedIn profile.
David Moross, co-founder, chairman and CEO of HighPost Capital, mentioned in an announcement that, “In a brief time period, Gabi and Greg have constructed an incredible model with a fiercely loyal and engaged client base by their unwavering dedication to innovation and creativity. We look ahead to leveraging HighPost’s deep client sector experience to help Magic Spoon’s continued progress.”
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