The firm, which recently hired Barney Acselrod (who has worked at Snapple, Vitamin Water, PopChips and Bai Brands) as its executive VP of sales, has achieved significant growth under its own steam, but needed more capital to take it to the next level, said Breen.
Speaking to us after announcing he had sold a minority stake in the business (Live Better Brands) to ACG, he said: “We’ve had a lot of success building distribution on our own but this capital will really help us build out our sales infrastructure and bring in more great people.”
Breen, who left his role as VP of sales at Hain Celestial in 2010 and launched his first Way Better tortilla-chips in 2011, has since achieved the kind of success that most entrepreneurs can only dream about, with his products now in thousands of stores from Walmart to Whole Foods with an ACV of almost 90% in the natural channel and around 50% in mainstream grocery.
Red fife and spelt 'pita-ahh' chips and sprouted barley crackers rapidly followed and new products are also in the pipeline, but he still feels like he’s scratching the surface, said Breen. “There are so many opportunities. The ACV figures are good but they only tell you so much. Within stores we are already in there are also so many opportunities to go from two items to four to six and so on, as well as picking up new accounts.”
Very significant growth
While he would not disclose revenues, Breen said the brand had generated “very significant growth” at the “upper end of the category” as consumers had bought into its strategy of taking familiar snack products (tortilla chips, pita chips, crackers) and making them healthier by using high quality ingredients, notably sprouted grains.
“It’s just about providing better options for consumers.”
The fact that the seeds in Way Better Snacks are sprouted (where the germination process is started by adding moisture, and then halted just after the ‘sprout’ begins to grow by drying the seeds again) is not the sole purchase driver, but is a key part of his brand’s appeal, added Breen.
Speaking to us last year, Breen said consumers were starting to see the word ‘sprouted’ appear on more products: “Consumers don’t necessarily understand why sprouted is better, but they think ‘Hey, sprouting, that's good for me’; they were just really responsive to our brand and to our products right from the start.”
According to Breen, the nutrients in germinated seeds and grains are more bio-available because the sprouting process eliminates or reduces components such as phytic acid which are designed to lock in the nutrients and stop the seed germinating before it’s planted.
Tests conducted by third parties also show that the sprouted seeds - which are used as ingredients in Way Better Snacks products after being gently dried - are also higher in certain vitamins and minerals, beta carotene, biotin, choline and folic acid (depending on the seed/grain), and have higher ORAC scores, because they naturally increase during the germination process.
As for his meteoric success, said Breen: “Every entrepreneur will sit on the couch at the beginning and visualize where they want to be in three years and they have this trajectory, this is where I’ll be in year one, year two and so on. But the reality is usually quite a bit different from that.
“But for us, what we were fantasizing about actually happened, which is pretty unusual. We were getting commitments from marquee retailers before we’d even shipped products.”
Other high-profile companies ACG has invested in include KRAVE Jerky (subsequently acquired by Hershey), EVOL Foods (subsequently acquired by Boulder Brands) and Shake Shack (which recently completed an IPO).