Supplement brand Gainful to raise $20M to $30M round
Gainful, a provider of performance nutrition products, plans to raise around $20 million to $30 million in the second half of the year, its CEO Dean Kelly tells Axios exclusively.
The big picture: Gainful's move is part of a larger trend of DTC brands expanding into retail and wholesale because acquiring customers online continues to be both more difficult and more expensive.
The New York City-based company is seeking a strategic investor as it ramps up expansion into retail.
Driving the news: Gainful recently began offering its products in 1,800 Target locations, which has been adding new supplement brands to its health and wellness section.
Of note: Before March, Gainful only had a DTC business.
Details: Gainful is seeking an investor with experience in guiding brands to several hundred million in sales, Kelly says.
- Tied to that, the company wants to add a woman to its board of directors, he says.
- In addition to bringing in a new growth firm, existing investors and well-known athletes and celebrities are keen to participate in the round, according to Kelly.
By the numbers: To date, Gainful has raised more than $10 million.
- The company is generating tens of millions in revenue, Kelly says, declining to be specific.
- Gainful hopes to double the business this year, he says.
- Proceeds will be invested in retail expansion, product development and improvements in its digital personalized nutrition platform, which collects data from customers.
What's next: Further retail expansion is expected, into mass, specialty, club and gyms.
How it works: Gainful offers a line of products such as protein powders — whey, keto or vegan — personalized for gender, dietary restrictions, nutrition goals and exercise regimen.
- It also sells hydration, pre-workout and performance-boost products.
Be smart: The supplement business has been focused on acquiring a higher quality, stickier customer, which has resulted in an increase in the average order size, Kelly says.
- The company has also hired a VP of brand, given the growing inefficiency of existing marketing channels, he says.