Summary
During my time in strategy consulting I analyzed a plethora of growth equity deals. 95% of them had weaknesses that would have kept me at bay. Only a couple of products were exciting enough from a growth profile that I wanted to put my money behind them.
Both instances involved natural food snack companies that were growing at an exorbitant rate. This growth is driven by the fast pace of growth at the intersection of snacking and healthy eating. This is why I am so excited to cover the Avoke story. The team is working to bring avocados to your everyday snacking lineup.
This on-trend product will have an opportunity to become a snacking staple as Americans demand more superfood products and delicious snacks. Check out how this team is executing on their vision in our latest founder profile with Esther Bernstein, Co-Founder & CEO of Avoke.
Esther, can you provide us with a bit of background on yourself and how you decided to co-found a natural, vegan avocado snack company called Avoke?
As speech language pathologists and mothers, my sister Leah and I, spend our days helping people achieve their potential. When Leah’s son was failing to thrive due to severe food allergies, she began blending avocado with fruits and vegetables to create wholesome and nutritious meals full of the goodness and the naturally rich taste only avocado has. After tasting one of her blends she experienced an “aha!” moment. and decided to share the magic of avocado with everyone!
When Leah shared her vision of creating healthy organic foods with an avocado base, I was inspired. We also realized that this portable nourishment option was one that all people could feel good about and would be excited to eat. We saw what was missing from the cold-pressed juice craze was a healthy option with low sugar and filling fiber that didn’t leave people feeling hungry and deprived, but instead made them feel good about themselves and their choices. Wouldn’t other healthy consumers like ourselves be just as enthusiastic to get a nourishing blend of avocado, superfoods, vegetables and fruits in a convenient, on-the go bowl? The answer was a profound yes, and the rest is Avoke history.
For those that don’t know how do you define the Avoke product?
Avoke has created the first grab-and-go, smoothie bowl available on the market. The smoothie bowls come in four delicious flavors: Berry Mint, Greens & Ginger, Spicy Carrot, and Coconut Curry. Each cup contains half an avocado, two servings of fruits and vegetables, a toasted quinoa topping, and 1 billion CFU’s of probiotics. Packaged in an attractive, patented avocado-shaped cup with an eco-friendly spoon inside, Avoke’s smoothie bowls will make the grab-and-go snack of choice!
Avoke’s products are kosher, gluten free, and vegan as we use only the highest quality and freshest ingredients and production methods. Our smoothie bowls are cold blended and pasteurized using high pressure processing (HPP) and not heat. High pressure pasteurization process kills bacteria, but keeps the flavor and nutrients intact.
What other similar products currently exist in the avocado snack category if any and how do you differentiate?
Currently, there are many products that contain avocado as an ingredient but there is no known complete product line with avocado as the main focus outside of guacamole. Though there are several products like avocado mayonnaise and oils that are quickly coming to market. Additionally, some Hpp juices, Gazpachos, and humus may feature avocado in some of their flavors.
Who is your target consumer for this product and what early signals have you seen from the direct-to-consumer channel?
Avoke is the solution to a healthy and vegan snack/meal replacement for the busy but health-conscious millennial consumer on-the-go. The growth of the ‘grab-n-go’ category is exploding as the consumer is skipping meals and eating snacks on the go! Avoke’s product attributes has the ability to attract busy consumers and bring new users, including men, into the fresh veggie snack category. Moreover, veg options are a nascent but growing segment of the snack and meal replacement market that has arisen from consumer desire for healthier options. We have showcased at the Natural Products Expo East in Baltimore and had gotten rave reviews and have even been nominated for the Nexty Award.
How do you determine the types of flavor profiles to release and what type of market research have you done to produce the Avoke product that exist today?
We’ve tried and tested several flavors with some small focus groups and hit upon the right balance of sweet and savory. Our Greens & Ginger and Berry Mint flavors will definitely appeal to those craving a healthy, sweet snack with a fresh, earthy punch. While our Coconut Curry and Spicy Carrot bowls cater to the growing demand for savory and spicy snacks.
What is the price point of your product, and what types of margins do you see on that price point?
Avoke will retail in stores with an average SRP of $4.99 with initial margins at 20-25%. As we scale we project the margins will increase substantially.
What types of retailers do you plan to sell into (e.g., specialty, mass market) and how far off do you think opportunities like that are?
Our focus is to create deep distributional capabilities within key geographies while retailing nationally in chains that align with our core naturals business or target consumer demographic. We hope to sell the smoothie bowl line direct to major retailers as well as to distributors into smaller retailers and in foodservice.
What type of progress have you seen on building out relationships with the retail channels and when do you think we will begin to see Avoke on retail shelves?
We have a large distributor that is ready and waiting to take on our product. They have plans on putting Avoke into several regional healthy supermarket and grocery chains. There are also several stores that are ready to put Avoke on their shelves. Currently, we are awaiting organic certification and project our launch to be in mid-Fall.
What is your sourcing strategy for avocados and your other ingredients to ensure everything is vegan, organic, etc.?
We have done a lot of research on sourcing and are only using high-quality fresh and frozen produce from reputable vendors with vegan and organic certifications.
Can you talk about your sustainable packaging and how that plays into the overall attractiveness of the product?
Instead of conventional packaging, Avoke uses BPA free lite weight plastic cups, shaped like half an avocado, and included in the packaging is an eco-friendly spoon. We love helping to reduce packaging waste! We have a patent on our custom, avocado shaped cup and our packaging has garnered rave reviews from consumers and buyers alike. In our focus group tests, this cup along with the eco-friendly spoon had a ‘WOW FACTOR’ response.
What trends in snacking support the growth of a business like yours?
With our product we are hitting many of the most popular current food trends; chiefly trends like avocado, Grab-and-go healthy snack, vegan, and even probiotics. If you look at the growth in popularity and increasing consumption of avocado, you see that it is no longer fringe or just for the health minded. It’s gone mainstream.
The global avocado market registered sales revenue of about $12 billion in 2016. Likewise, the growth of the grab-and-go snack market continues to explode as consumer’s busy lives call for convenience with healthy options. According to Grandview Research, the healthy snack market was valued globally at $21.1 billion in 2016. Additionally, the trend to go vegan is growing exponentially. In the USA 6% of the population now identify as vegan, showing a increase of 500% since 2014. Recently, restaurant consultancy group Baum+Whiteman named “plant-based” as the biggest food trend in 2018.
Why did you decide to pursue an equity crowdfunding raise and how do you plan to deploy that capital?
We felt that Avoke will pique the interest of many consumers and investors, as who doesn’t get excited to a new and unique food product?! We have in the past raised over 300K from friends and family as we worked on creating and developing Avoke. We want to use the funds from this raise to help support our launch into the retail market and to drive our PR and marketing.
With a $12B avocado market and grab-and-go on the rise we like the investment prospects of the Avoke team. Partaking in this round has the potential to yield a positive social and capital return. Be sure to invest HERE.
