Food Tech Startup BetterBrand Notches Record $170 Million Valuation After Series A Funding

Food & Drink

BetterBrand, best known for its flagship line of low-carb, high-protein frozen bagels produced with IP-protected Grain-changing Technology™, has amassed $6 million in a recent financing round, making the startup’s founder Aimee Yang one of the 147 sole women founders who have ever raised a series A over $5 million from institutional investors, Crunchbase data showed.

This round was led by VERSO Capital with additional participations from returning VCs and notable individuals, including Gaingels, Alexis Ohanian’s Seven Seven Six, Craft Lane, Cruise’s founder and CEO Kyle Vogt, venture capitalist Chris Hollod, as well as Harry Styles’s manager Jeff Azoff and his spouse from Apple
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Music Glenne Azoff. BetterBrand is also backed by Sean Thomas of the Wendy’s Family, MOSH’s cofounder Patrick Schwarzenegger and actress Emmy Rossum.

“Aimee Yang is an incredible entrepreneur and a solid operator,” Vogt said in a statement. “Her company offers life-changing, clean, functional products for those who previously felt they had to give up some of their favorite foods to fit their nutritional needs. It’s an exciting journey to be a part of.”

Also commenting on the raise, Gaingels’ managing director Lorenzo Thione said: “Aimee’s unique combination of determination, vision, and ability to innovate sets her apart as a founder. At Gaingels, we are thoroughly convinced that under her leadership, BetterBrand is poised to redefine our very relationship with carbohydrates, by combining health and taste in one innovative package.”

As a result, BetterBrand also scored a record-breaking valuation of $170 million, according to Crunchbase, surpassing that of some of the biggest tech players, including Meta ($100 million upon series A) and Tesla
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($22.9 million). Yang attributes this milestone to a combination of BetterBrand’s market potential, brand resonance with the consumer, and projected revenue growth over the next 12 months.

“We were trying to figure out a fair place to land on price,” Yang recently told me during an exclusive interview. “Given the ambition we have, and how quickly we’ve grown from our direct-to-consumer data and wholesale velocity, we landed at this valuation which is very encouraging.”

BetterBrand launched exactly two years ago starting with its classic flavor, and has since expanded with five additional varieties, including chocolate chip, cinnamon, everything, as well as recently added pretzel and sesame. Each product provides 5g of net carbs, equivalent to two slices of banana, and around 25g of protein.

The company’s Grain-changing Technology™ can reduce carbohydrates in traditionally high-carb foods, while increasing short-chain fatty acids production, improving metabolism in the human body, Yang previously explained.

During its first year, the company has reportedly seen its sales increase by 800%. After launching in Whole Foods globally last year and subsequently, entering over 1,000 retail stores, including Sprouts, Fresh Market, Gelson’s, Bristol Farms, Giant, Plum Market, Foxtrot, BetterBrand anticipates similar growth momentum in 2023.

“We launched into retail in a pretty significant way, and Whole Foods, as our key partner, has been incredibly supportive,” Yang said. “The most exciting part is that all our growth has been happening virtually and organically, which really speaks to the excitement the product is able to generate among the consumer, and our messaging around freedom, inspiration, and empowerment.”

She stressed how keeping her team lean (fewer than 10 full-time employees) and optimizing margin from the onset are key to maintaining BetterBrand in tip-top shape, especially as a frozen brand. “We’re incredibly efficient: we haven’t spent a dollar on influencer marketing, and a lot of traffic and posting on social media just proliferate themselves,” said Yang. “We also decided on the frozen aisle in the first place because consumers are looking for products made without additives or preservatives, and we maintain as clean label.”

The low-carb diet market was worth $10.93 billion in 2021, Data Bridge Market Research estimated, and it’s expected to grow at a 6.9% CAGR rocketing up to $8.65 billion by 2029. BetterBrand hopes to take a bigger bite out of the market by reinventing adjacent high-carb baked goods.

“We’re launching a new product next in combination with Thrive Market, and that will transform an everyday food item with a ton of use cases into the same amount of carbs as two slices of apple,” Yang said.

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