BATTLE CREEK, Mich.-- Kellogg Co.'s venture capital fund, eighteen94, has made its first investment in food startup Kuli Kuli, leading a $4.25 million funding in the maker of superfoods.
Based in Oakland, Calif., Kuli Kuli manufactures and distributes nutrition bars, powders and beverages featuring a plant protein from Africa called moringa.
Other institutional investors in the round were InvestEco and S2G Ventures.
Moringa is a complete plant protein produced by trees grown in semiarid and tropical areas. Kellogg said its leaves, pods and oil can provide a good source of iron, calcium, vitamin A, and other nutrients.
"We are excited to partner with eighteen94 capital and Kellogg, and we're thrilled that they see the potential in our company and in moringa as a next-generation superfood," said Lisa Curtis, Kuli Kuli founder and CEO. "We want to create a world where everyone has access to nutritious sources of food. Through this relationship, Kuli Kuli will benefit from Kellogg's resources and global presence, both of which will help us achieve our goals."
Curtis said Kuli Kuli is interested in expanding distribution into new stores across channels, but there are no current plans to distribute to convenience stores. "While we have no concrete plans to expand into convenience stores, we think there could be a good fit with our Moringa Green Energy shots in particular as more health-conscious consumers seek to find nutrition on the go," she told CSP Daily News. Kuli Kuli products are sold in more than 3,000 stores, including Whole Foods, Safeway-Albertsons and Sprouts Farmers Market.
Curtis founded the company in 2013. She discovered moringa while volunteering with the Peace Corps in Niger, West Africa. Products include Moringa Superfood Bars in crunchy almond, dark chocolate and black cherry varieties; Moringa Green Energy Shots in coconut lime, ginger lemon and raspberry flavors; Pure Moringa Vegetable Powder; and Organic Moringa Tea.
"By investing in Kuli Kuli and helping them grow, we're backing a new superfood category, one in which we see the potential for ongoing high growth," said Simon Burton, managing director of eighteen94 capital and now a member of the Kuli Kuli board of directors. "We love the company's strong management team, great products and the authenticity of their social mission."
With this investment, Kellogg's joins other major U.S. food manufacturers who are partnering with or investing in startup ventures to expand their offerings of natural foods as consumers are demanding healthier options. Others including Campbell Soup, Tyson Foods and General Mills have launched similar venture capital initiatives. PepsiCo and Dr Pepper Snapple Group recently acquired companies they had invested in when the products (KeVita for Pepsi and Bai Brands for Dr Pepper Snapple) performed strongly.
Kuli Kuli is the first investment for eighteen94 capital. The fund was launched in June 2016 to invest primarily in companies pursuing next-generation innovation, giving Kellogg's access to cutting-edge ideas and trends. The investment mandate includes a focus on startup businesses pioneering new ingredients, foods, packaging and enabling technology. The Kellogg's venture capital arm has vowed to invest about $100 million.
Curtis said Kuli Kuli sources moringa from women's cooperatives across West Africa, South America and the Caribbean. "We continue to grow our moringa supply chain by providing fair, sustainable wages to farmers and women-led co-operatives around the world," she said.
Kellogg's brands include Keebler, Special K, Pringles, Frosted Flakes, Pop-Tarts, Rice Krispies, Cheez-It and Eggo. The Battle Creek, Mich., company had 2015 sales of $13.5 billion.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.