WSJ: KarpReilly Backs LifeAID Beverage Co.

Updated July 21, 2016 6:16 p.m. ET

LifeAID Beverage Co., a maker of nutritional supplement drinks, said it secured an investment from private-equity firm KarpReilly to fund the company’s expansion efforts.
Terms of the deal, described as a minority position, weren’t disclosed in a news release.

Santa Cruz, Calif., company said it would bolster its sales and marketing teams as well as expand its footprint in conventional retailers.

Orion Melehan, a co-founder at the company, said LifeAID had been approached by other private-equity firms before choosing to partner with KarpReilly. He said firms had heard of the business because of its presence in the CrossFit market.

Aaron Hinde, also a LifeAID co-founder, said the influx of capital would help the company hire more employees and invest in marketing and expanding its inventory base. Additionally, the founders noted that the company aims to expand into the golf market and grow its burgeoning food product division.

LifeAID’s performance and recovery supplement products include FitAID, FocusAID, PartyAID, TravelAID, GolferAID and FitAID Fuel Pouch.

KarpReilly invests in companies in the consumer sector, targeting retail, online commerce, restaurants, branded products, apparel, natural products, foods and beverages. The Greenwich, Conn., firm makes equity investments as small as $3 to $5 million and as large as $75 million.

KarpReilly said in February it acquired Zola, a maker of coconut water drinks, Acai juices and dark chocolate-covered fruit.

-Laura Cooper, Dow Jones reporter, contributed to this article.

SOUCREhttp://www.wsj.com/articles/karpreilly-backs-lifeaid-beverage-co-1469119927

Silicon Valley Business Journal: Private equity investor pumps money into Santa Cruz fitness drink maker

Gina Hall | Jul 22, 2016, 11:28am PDT

Beverage startup LifeAID raised an undisclosed round of funding on Thursday to pump up its growth.

KarpReilly led the round and now maintains a significant minority position in the Santa Cruz company. The private equity firm has also backed food ventures such as Sprinkles, The Habit Burger and KeVita.

Santa Cruz fitness drink maker LifeAid has raised money from private equity firm KarpReilly.

Santa Cruz fitness drink maker LifeAid has raised money from private equity firm KarpReilly.

CEO Orion Melehan and President Aaron Hinde co-founded LifeAID in 2012 after meeting each other at a CrossFit gym. The two partnered up to fill what they say was a gap in the market for premium, healthy and convenient nutritional products. They now sell five specially-formulated low-sugar, natural supplement beverages and a protein/carb food pouch, each designed to boost performance and speed recovery for fitness enthusiasts.

“We are building our brand to serve consumers with functional products that fit their lifestyle,” Melehan said in a press release. “There is a momentous shift happening in the beverage market. Consumers are waking up to what they are putting in their body, demanding alternatives to traditional sports drinks, energy drinks and sodas.”

The company sells its beverages at more than 7,000 domestic outlets and in more than 22 countries. A prime target is non-traditional retail outlets such as golf courses and CrossFit gyms. But it also sells in The Vitamin Shoppe, H.E.B and atWhole Foods.

The company said it will use the new funds to add to its sales and marketing teams and support the company’s footprint at conventional retailers.

Santa Cruz Sentinel: LifeAID Beverage hiring with investment from KarpReilly

LifeAID co-founders hiring, plan to expand to conventional stores

SANTA CRUZ >> For Orion Melehan and Aaron Hinde, the 40-something co-founders of healthy beverage startup LifeAID, year five may be their breakout year.

The day after their FitAID brand drink sponsored the Crossfit Games after-party for 2,000 people, the pair is on their way to a “flavor house” in Los Angeles where they will finalize a blend for a daily beverage.

This one will be called LifeAID.

“It’s a diet cola replacement,” said Hinde, a chiropractor and the company’s formula expert.

Check the FitAID label: 45 calories and 9 grams of sugar, lower than most carbonated drinks. You’ll find glutamine, glucosamine, Omega 3 essential fatty acids, CoQ10, turmeric, magnesium, vitamins C, D and E — ingredients athletes value.

Melehan pops in to mention the company’s two new blends, FocusAID to enhance workplace acuity and TravelAID to boost the immune system. Each recipe is slightly different; both are low in sugar and calories.

Both debuted in March at Expo West in Anaheim, which is the largest trade show for the natural, organic and healthy products industry.

The new products joined their first one, GolferAID to help golfers maintain energy, and FitAID, targeting athletes especially those at CrossFit, and PartyAID to feel good on your night out.

“After Expo West, we had a whole host of parties soliciting us, interesting in partnering with us and investing,” said Melehan. “We bootstrapped this from the beginning, we needed more money to scale.”

Last week, they announced an investment from KarpReilly, a private equity firm in Greenwich, Connecticut. This will fund their plans to bring their products, which are at New Leaf Community Markets, Whole Foods and have authorizations at multiple Albertsons/Safeway divisions to independent grocers, convenience stores and mom-and-pop markets. They have signed an agreement with Elyxir Distributing, which serves Santa Cruz County, and last week pitched grocery giant Kroger.

Currently, LifeAID has 26 employees and is hiring in sales, customer service and logistics. Hinde expects that number to grow to 40 by year-end.

The exact amount of the KarpReilly investment was not disclosed but Melehan said it’s in the “high seven figures.”

Melehan ticked off several reasons why the East Coast firm was a fit.

KarpReilly has taken 16 companies public.

KarpReilly invested in The Habit, a burger chain ranked as best by Consumer Reports and based in Santa Barbara. Melehan was a regular while attending UC Santa Barbara.

KarpReilly was co-founded by Allan Karp, who graduated from UC Santa Cruz with a chemistry degree before going to MIT. Karp has joined LifeAID’s board.

The investment allowed early shareholders to get some liquidity, “over 1,000 percent return,” Melehan said.

Are the LifeAID founders considering going public?

“That’s years down the road,” Melehan said.

Hinde recalls how Santa Cruz juice startup Odwalla was acquired by Coca-Cola.

“We don’t want to dilute our method and our brand,” he said. “We want to change people’s habits for the better.”

The Santa Cruz venture launched as consumers began to seek out healthier alternatives to soda.

Among the newcomers: KeVita, based in Ventura, selling cocoanut organic probiotic drinks, and Spindrift, based in Massachusetts, which offers fruit seltzers, and Suja, based in San Diego, specializing in organic, non-GMO, cold-pressured juice and a new line of drinking vinegars.

Carbonated soft drink sales sank to a 30-year low in 2015, Beverage Digest reported in March.

That trend, Melehan said, was evident to KarpReilly, which saw soft drink sales declining 10 percent a year in their portfolio of restaurants.

Glenn Ely of Elyxir Distributing expects to have FitAID in his Watsonville warehouse by the end of next week.

LifeAID BEVERAGE CO.

What: Manufacturer of premium, healthy and convenient nutritional products for active people.

Headquarters: Wrigley Building, 2833 Mission St., Santa Cruz.

Founded: 2011.

EEmployees: 26.

Leadership: Co-founders Aaron Hinde, president, Orion Melehan, chairman.

Information: Lifeaidbevco.com/ and 888-558-1113.

SOURCEhttp://www.santacruzsentinel.com/business/20160727/lifeaid-beverage-hiring-with-investment-from-karpreilly?source=most_viewed

PR Newswire: Capital Influx from KarpReilly Set To Accelerate Growth For LifeAID

SANTA CRUZ, Calif., July 21, 2016 /PRNewswire/ — LifeAID Beverage Company has secured an investment from private-equity firm KarpReilly, LLC (Dollar Tree, Sprinkles, The Habit Burger, Kevita, Zola…) to fund its continuing path of growth. The total amount of the transaction remains undisclosed, although represents a significant minority position according to company reps.

LifeAID’s line of “better-for-you” products includes FitAID, FocusAID, PartyAID, TravelAID, GolferAID, and the FitAID Fuel Pouch.

LifeAID co-founders Orion Melehan and Dr. Aaron Hinde considered other PE firms before selecting KarpReilly as the ideal partner. “The team at KarpReilly understands current consumer trends and passionately supports the functionality and nutritional value of our products. Additionally they were impressed with our go-to-market successes in non-traditional channels such as golf courses and CrossFit® gyms,” stated company president Dr. Hinde.

CEO Melehan added, “KarpReilly has a long-view approach and an impressive track record of scaling consumer brands. With their capital investment and imitable expertise, we now have greater resources to continue on our roadmap. We are building our brand to serve consumers with functional products that fit their lifestyle. There is a momentous shift happening in the beverage market. Consumers are waking up to what they are putting in their body, demanding alternatives to traditional sports drinks, energy drinks and sodas. LifeAID is the answer.”

“We were impressed with what Orion, Aaron and the entire team has done in such a short time with the resources they had available,” says KarpReilly co-founder Allan Karp, who will be joining the LifeAID board. “LifeAID is full of tremendous promise and is a great addition to our beverage portfolio. The writing is on the wall… functional beverages represent an evolution, we are betting on the best suited team to lead that change.”

The proceeds from this raise will expand the LifeAID sales/marketing teams, supporting LifeAID’s growing footprint in conventional retailers through a DSD network.  The brand is currently sold in The Vitamin Shoppe, H.E.B, and Whole Foods, with authorizations at multiple Safeway/Albertsons divisions. The natural channel will continue to be serviced by UNFI.

About LifeAID:
LifeAID is the leading manufacturer of premium, healthy and convenient nutritional products for different active lifestyles. Products are currently sold in over 7000 domestic outlets and in over 22 countries.  For more information, visit www.lifeaidbevco.com

About KarpReilly:
KarpReilly, LLC is a private investment firm, founded by Allan Karp and Chris Reilly, whose primary mission is to partner with premier small to mid-size growth companies and help them achieve their long-term vision. KarpReilly currently manages funds and affiliates with capital commitments in excess of $500 million. Over the past 15 years, the principals of KarpReilly have invested in, sat on the boards of and nurtured over 25 growth companies. For more information, please visit www.karpreilly.com.

SOURCE:  http://www.prnewswire.com/news-releases/capital-influx-from-karpreilly-set-to-accelerate-growth-for-lifeaid-300301825.html

 

BEVNET: LifeAID Founders Discuss KarpReilly Investment

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LifeAID, a functional beverage brand based in Santa Cruz, California, has completed its first capital raise outside of friends and family with an investment from private equity firm KarpReilly.

After announcing the news in a press release last week LifeAID co-founders Aaron Hinde and Orion Melehan discussed the investment in a call with BevNET on Tuesday, indicating the amount of the raise was in the “high seven figures.”

“Building out our distribution and sales networks is an endeavor and we knew it would require an institutional partner to back us,” said Melehan.

The duo went go on to discuss how the investment came about, as part of the company’s ongoing move beyond the targeted, niche communities – Crossfit gyms, golf courses, music festivals – where it’s built a following into more conventional channels of distribution, including Vitamin Shoppe, Whole Foods and several Safeway/Albertsons divisions.

“The plan was always to first build the consumer base and brand awareness in the on-premise market and dominate those niche channels,” said Melehan. “This raise will really help bridge the chasm between our niche communities and conventional.”

“Instead of pushing our way into conventional we’ve gotten pulled into conventional,” added Hinde. “How is it we’re doing so well at H-E-B? Well, Crossfitters shop at H-E-B, golfers shop at H-E-B, the Burning Man community shops at H-E-B. Our community is already intact and already shopping at these retailers and they’re demanding our product.”

The company’s move into conventional retailers will also see the introduction of a more mainstream, less specialized addition to its product line. Later this year the company will launch LifeAID, a beverage high in antioxidants and natural anti-inflammatory ingredients, targeting the soda consumer looking for better-for-you alternatives.

“This is a beverage people could easily swap out their daily diet soda habit for and then they’ll continue to have their FitAID with their fitness, and FocusAID at work when they need a pick-me-up, and PartyAID on the weekends,” said Hinde.

For KarpReilly, its investment in LifeAID is the latest addition to a growing beverage portfolio. The firm has previously invested in Kevita and Spindrift, and in February of 2016, the firm announced its acquisition of Zola.

SOURCE: https://www.bevnet.com/news/2016/lifeaid-founders-discuss-karpreilly-investment

Review from Jason Cappetta Executive Chef/Partner, Dawn of Thyme

Continue to put out this amazing product. I stand behind it for its flavor and authenticity. As a professional chef and coach I can only recommend FitAID and your products as the best of the best. Our company is unique as it services and provides meals to countless crossfitters and beyond. From your sales team to your product developers we thank you all for your commitment to excellence!

Cheers!
Jason Cappetta
Executive Chef/Partner
Dawn of Thyme LLC