Sproud, the Swedish pea-based vegan milk brand known for its bold zebra-esque packaging, has raised £4.8 million (US$6.57 million) in its latest round of funding. The news comes amid a high for the alternative dairy sector, with investors placing their bets on the fast-growing sector as mainstream consumers continue to propel the dairy-free trend.
Sproud announced on Tuesday (January 26) that it has secured £4.8 million (US$6.57 million) in funding from VGC Partners, a London-based growth capital firm based in London, bringing the startup’s total capital raised to date to US$11.9 million. The Swedish startup, who is known for its line of plant-based milk products made from pea protein, described the investment as a “huge step forward” for the company and will enable its expansion into new markets.
“We are really pleased to have the backing of VGC on our mission to create the best tasting, and most sustainable plant-based offering on the market,” said Nicklas Jungberg, Sproud’s co-founder and board chairman. “We have reached a stage where most people are now aware of the positive impacts that swapping dairy for vegan substitutes would have on our planet and health.”
According to the company, its pea-based plant milks are not only far more sustainable than traditional dairy, but are also more eco-friendly and less water-intensive than other plant-based options on the market, such as almond-based milks. In addition, Sproud’s pea milks pack five-times more protein than almond milks and triple that of oat milks.
We have reached a stage where most people are now aware of the positive impacts that swapping dairy for vegan substitutes would have on our planet and health.Nicklas Jungberg, Co-Founder, Sproud
Currently, the brand offers four different products in total – original, barista, unsweetened and chocolate – all of which are 100% vegan, fortified with vitamins, and also completely shelf-stable from production to store shelves, which slashes a third of the carbon footprint required for refrigerated products.
Revealing further specifics of its expansion plans to FoodNavigator, the Malmö startup said that the capital will help the brand double down its presence in its core markets, which includes the U.K., where it is retailed by Waitrose and Ocado, as well as in the U.S. and Canada, where it has been sold via Amazon and select grocery stores since February last year.
The funding news comes as plant-based dairy undergoes major growth, particularly in the wake of the coronavirus, which has accelerated the shift that consumers were already making prior to the crisis, dealing what experts have described as a death-blow to big dairy.
Investors, now bullish on the future of alternative proteins, have been pouring funding into startups like Sproud, such as its fellow Swedish brand and perhaps one of the best known vegan plant milks to date, Oatly, who controversially landed US$200 million in a Blackstone-led round and is now reportedly considering an IPO.
We believe Sproud has the potential to become a global leader in the huge and growing dairy alternative market, owing not only to its superior taste and nutrition profile, but also due to its positive environmental and sustainability credentials.Parminder Basran, Managing Partner, VGC Partners
Commenting on the decision to back the Swedish pea milk makers, Parminder Basran, the managing partner of VGC Partners who lists plant-based egg pioneer Eat Just among its portfolio companies, believes that the alternative dairy market is only getting started.
“Through our experience of backing innovative food and drink brands, we have a deep understanding of the plant-based market, including from the perspective of evolving consumer demands and the cutting-edge product innovation that is catering to this,” said Basran in a statement.
“We believe Sproud has the potential to become a global leader in the huge and growing dairy alternative market, owing not only to its superior taste and nutrition profile, but also due to its positive environmental and sustainability credentials.”
Other startups who are using different technologies to develop alternative dairy products have also been keenly watched by investors, such as Singapore’s TurtleTree Labs who have bagged US$6.2 million in a Pre-A round for its lab-grown milk, and Israeli startup Remilk, raising US$11.3 million to scale its microbial fermentation dairy platform.
Perhaps the most notable fermentation category funding to date is Perfect Day’s US$300 million Series C, a record-breaking round for the up-and-coming alternative protein sector, propelling the startup to launch ice creams made with its precision fermentation animal-free whey proteins in the U.S. with its Brave Robot label and in Hong Kong.
All images courtesy of Sproud.