New York-based investment firm VG Growth Partners acquired an undisclosed stake in Free2b Foods earlier this month.
A Colorado family remains the Boulder-based food firm’s largest investor.
"But VG Growth Partners is a close second and has a board seat. It will be very involved operationally," Mike Murray, CEO of Free2b Foods, told ConfectioneryNews.
VG Growth Partners invests in very early-stage startups with $500,000 to $3m plus investments. It is building up a portfolio of plant-based foods. Last year, it acquired a stake in bean snack brand Crunchsters, also based in Boulder.
Distribution, marketing & R&D
Murray – who was a senior brand manager at General Mills from 2001 to 2011 – said VG Growth Partners’ investment would support Free2b Foods’ expansion plans.
"The equity is very useful for a number of things. We've got it earmarked to fund new distribution, building the brand with marketing and fueling innovation initiatives.
"We’re going to continue to innovate in confections with flavor varieties and forms, but we also want to expand into broader snacking.
"The next really new stuff will be in Q1 2018. We prefer chocolate to be involved, but not necessarily the lead component of the recipe,” he said.
Snack Breaks launch
The company is working to a five-year plan in which it aims to "become the most trusted free from snacking brand across multiple categories", said Murray.
Free2b Foods launched in 2008 with Sun Cups, an allergen-free alternative to Reese’s.
It introduced chocolate bar range ‘Top 12 Allergen Free’ last year and recently moved into premium snacking chocolate with Snack Breaks.
The company’s dairy-free chocolate uses organic rice syrup powder to replace milk ingredients.
Free2b Foods hopes to grow distribution in the US natural channel with its chocolate bars and Snack Breaks. It will then target conventional retail and grocery stores.
The company's chocolate bars have US listings at retailers such as natural chain Sprouts and supermarket chain Giant Eagle. Its primary brand Sun Cups is sold throughout the US, including at mainstream retailers such as Target.
Free2b Foods will soon expand distribution to Canada.
"We have a large order in Canada for our Snack Breaks launch. Canada is a prominent player for the first time for us with Snack Breaks - we don't have any business there with our cups and bars yet,” said Murray.
"We want to shore up and build momentum in the US as the first priority and then move upward in North America to Canada as the next priority,” the CEO continued.
Free2b Foods has its own factory in Boulder, Colorado. The company uses Rainforest Alliance certified cocoa and its products are non-GMO Project verified.