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BFD Expert Voices - Retail Deals

BFD Expert Voices

Foodberry, a Boston-based food tech startup, is raising a $15 million Series A round that will close by the end of this year, CEO Marty Kolewe tells Richard exclusively.

Why it matters: After taking years to hone its product and branding, the B2B provider of plant-based packaging is finally coming to market this year.

Details: Prospective investors will include its multinational B2B partners, Kolewe says.

The raise coincides with commercial launch milestones and proceeds will be invested in accelerating growth, he says.

Foodberry has raised around $13 million in seed financing since 2019, Kolewe says.

How it works: Foodberry has reverse-engineered fruit skins, creating edible, non-permeable, plant-based coatings from fruit and vegetable fibers that can replace packaging such as plastic.

Theoretically, its products could be sold alongside apples and oranges, with coatings akin to that of tomato or blueberry.

Foodberry is working with various CPG companies, including an unnamed $1 billion-plus coffee brand.

Catch up fast: The startup has partnered with dairy-free ice cream company NadaMoo to develop a line of frozen snack treats.

It's also been working with a startup in New York City that uses its wrapping for fruit.

Flashback: Foodberry, once known as Incredible Foods, was founded in 2012 under the original name WikiFoods by Harvard professor David Edwards.

The initial premise was to make sustainable and edible packaging inspired by fruit skins.

It earned recognition from Time magazine in 2014 for creating what was deemed an edible wrapper.

What's next: Currently, the company co-manufactures products in its facility in Boston, but the business model will rely mainly on royalty and tech transfers, Kolewe says.

What they're saying: "We are a technology company. We are providing real innovation that's better for people and actually makes an impact, so let's partner up with some major players," Kolewe says.

1 big thing: Foodberry raising $15M Series A

Bite-sized balls of cheese are coated in Foodberry's edible packaging.

Alibaba, the Chinese tech giant, plans to raise financing from outside investors for its Digital Commerce Group, Kimberly writes.

Why it's the BFD: The company is undergoing a major restructuring effort that would split its business into six.

Details: The company says the funding will support the digital commerce unit’s geographic expansion, investment in new technologies, and help it expand its consumer and supplier base.

Its international digital commerce group includes its Lazada and AliExpress online shopping platforms.

What’s happening: The company said today it plans to spin off its cloud division into a separate, publicly traded company.

“We are taking concrete steps towards unlocking value from our businesses,” CEO Daniel Zhang said in prepared remarks.

The company posted its financial results for the March quarter, recording a 2% increase in revenues, behind analysts’ estimates, and a jump in adjusted earnings.

Of note: Alibaba is also planning an initial public offering of its Cainiao Smart Logistics unit, for which it holds a 67% stake.

It will also aim to IPO its new retail business, Freshippo (Hema), which it expects to close in the next six to 12 months.

2. The BFD: Alibaba's revamp and outreach

Photo: Rafael Henrique/SOPA Images/LightRocket via Getty Images

🛏️ PE firm Apollo, which was part of a 2020 lawsuit against Advent that argued that a Serta Simmons' debt restructuring would have inappropriately pushed debtholders like it down the repayment stack, has settled with the now bankrupt mattress maker, our colleague Dan Primack writes.

It's a situation, however, where neither side "comes out of this looking good," Primack writes.

Advent lost its money on Serta Simmons and suffered some reputational damage on the 2020 debt deal. Apollo only gets 50 cents on its debt dollar, in exchange for sparing one of its partners from having to testify under oath.

🇮🇳 Lifelong Online founders bought back majority ownership and control of Thrasio, an Indian brands house and Amazon aggregator, in a sign the company is pulling back from the key market, TechCrunch reports.

Investors Tanglin Venture Partners and Hero Enterprise have also increased their stakes in Lifelong Online.

⚖️ HF Foods Group, a food supplier to Asian restaurants, filed a lawsuit against a group of investors asserting the group is illegally trying to take control of the company, MarketWatch reports.

In the suit, it claimed the group filed false and misleading regulatory disclosures and that it had conducted an illegal tender offer that coerced HF Foods stockholders to sell their shares.

3. Retail therapy

Illustration of two speech bubbles in the shape of shopping bags.

• Stacklok, a supply chain security startup, raised $17.5m in Series A funding from Accel and Madrona. https://axios.link/41Q90ul

• J.H. Whitney & Co. hired Goldman Sachs to find a buyer for Alphia, an Ogden, Utah-based pet food maker that could fetch more than $1b, per Reuters. https://axios.link/3MFI1O8

4. Retail transactions

• Freshpet refreshed its board, elevating Walter George, the chair of the nominating, governance and sustainability committee, to its new independent board chair. David Biegger, former Conagra chief supply chain officer, joins the board. Chair Charles Norris won’t stand for re-election. https://axios.link/3IoqYNI

• Mats Heimes (ex-Summit Partners) and Chris Wilson (FT Partners) joined Great Hill Partners as vice presidents, while Erik Kreukniet (Macquarie) joined as an associate. www.greathillpartners.com

• Wetzel’s Pretzels promotes COO Vincent Montanelli as its brand leader and will maintain his operating chief title. CEO Jennifer Schuler has left the company. https://axios.link/3MgGBrV

• Focus Brands, the Cinnabon and Carvel parent, has named Dave Mikita as its president of Focus Brands International and retail channels and Nathan Louer as its new chief brand officer at Jamba. https://axios.link/3IlvJaS

5. It's Personnel

Happy Thursday, Retail readers! Let's dive in.

Situational awareness: Walmart reported a 7.6% increase in Q1 sales, including a 27% jump in U.S. e-commerce sales, and raised its full-year guidance with CFO John Rainey noting consumers are still spending.

🍽️ What we're doing: Kim is hosting an awards dinner this evening for the Deadline Club, the New York chapter of the Society of Professional Journalists.

🙏 Many thanks to newsletter editor Claire Rychlewski and copy editor Mickey Meece for today's edits.

May 18, 2023

1 big thing: Foodberry raising $15M Series A