Brain food startup Mosh closes $13M series A as cognitive wellness goes mainstream

A $13 million investment in the pioneering brain food brand Mosh underscores the potential of the emerging cognitive health food and beverage market, which is estimated to be worth $18.1 billion globally and projected to reach $40.3 billion by 2030, according to Grand View Research.

The successful series A fundraise, announced last week and led by Main Street Advisors with support from Great Circle Ventures, Rogers Healy and Morrison Seger, PCG and Tonic Ventures, also comes at a time when investment in packaged food is significantly harder to come by than five years ago – highlighting the importance of the startup’s strategic focus on establishing strong fundamentals, including proof of concept, before fundraising.

It also doesn’t hurt that the brand is co-founded by celebrities Maria Shriver and Patrick Schwarzenegger, who can shine a light on both the brand’s mission to raise awareness for brain health and Alzheimer’s research and its products, including bars and peanut butter cups made with a “signature brain blend” of lion’s mane, ashwagandha, vitamins D3 and B12, omega-3 and Cognizin.

Brain health goes mainstream

Even when venture capital investment in food and beverage was at its peak, a $13 million investment – especially a series A – would have been unusual and an indicator that a brand, or the category in which it played, was on the precipice of rapid growth.

This appears to be true for both the brain health category and Mosh as a brand.

According to Grand View Research, the brain health food and beverage sector will grow at a compound annual growth rate of 10.5%, which is faster than the overall functional wellness food and beverage market, which is growing at an estimated 9.4% CAGR and will reach a staggering $1.59 trillion by 2030.

“Brain health is not niche anymore. If you do a Google trend search for brain health, you see that it started accelerating around the COVID pandemic and it is has continued to accelerate from there. It hasn’t slowed down,” Mosh President Jeff Gamsey said.

He explained interest in brain food continues to grow post-COVID in part because cognitive decline “touches almost every family in the world in a very personal way.” For example, Gamsey said, he lost his grandmother to Alzheimer’s disease, and Shriver lost her father to the disease more than 20 years ago, after which she became a champion for women’s health and a brain health advocate.

Mosh is an extension of Shriver’s work, and a portion of the company’s proceeds are donated to support women’s Alzheimer’s research, advocacy and awareness. So far, the company has donated more than $349,000 to the cause.

Mosh’s playbook reveals what it takes to fundraise in today’s economy

While a strong mission to do good can help companies pique consumer interest and even earn loyalty among those with whom it resonates, it is not enough to convince investors – especially in a difficult economy – that a business can deliver long-term, sustainable growth.

And that is where Gamsey said the startup’s “playbook to vault Mosh from a breakout brand to a category-defining, durably profitable business” helped win over its investors.

“There is no doubt that investors are being more selective right now, and I actually think that helped us, because our story is pretty straightforward,” Gamsey said.

He explained that in addition to the the brand’s celebrity-backing and on-trend benefits, Mosh is “unique and stands out because it has a model where the business and the mission reinforce each other.”

This is illustrated in the brand’s “meaningful retail momentum,” he added. He explained, Mosh’s first national account was with Sprouts Farmers Market where it “had great velocities,” which helped it gain entry to Kroger, where it subsequently demonstrated its appeal beyond the natural shopper in the conventional channel.

“We really wanted to prove that we had great traction in conventional retail accounts. And we did. For all of our Kroger accounts we have velocities in the top-quartile, and in a couple of their banners we are in the top-decile,” Gamsey said.

After proving the appeal of Mosh’s flagship nutrition bar in the natural and conventional channels, the company expanded its portfolio to include a high-protein line that earlier this month expanded into 2,000 Target doors – almost doubling the company’s door count.

“We’ve been in conversations with Target for a long time. They are repositioning their merchandising strategy to focus more on food and health and wellness. And we check a lot of the boxes that their strategy calls for: We serve an underserved consumer, we are mission driven, and we check the boxes for all the trends that are hot, including high-protein, high-fiber and low sugar,” Gamsey said.

“With those proof points and the market conviction, we knew it was time to bring in additional capital and start scaling retail event faster,” he added.

Mosh’s 4-prong capital deployment strategy

The $13 million capital infusion announced this month will help Mosh expand in national grocery, launch its high protein line, support both through marketing “that drives consumers to the doors that we are opening” and increase its mission-driven donation to Alzheimer’s research, Gamsey said.

Of these, the most immediately challenging could be creating effective marketing that educates consumers without overwhelming them or running afoul of regulations that restrict the types of health claims foods can make.

“Everything from the package design to the way we communicate with our customers, we want to be very, very approachable, very warm. We don’t want it to be overly clinical or a scary topic. If it feels like homework, you lose,” Gamsey said.

While the messaging may not be overly scientific, the research that backs the brand’s products is “built around clinically studied ingredients, not hype,” he added.

For example, the brand’s signature brain blend includes Cognizin, a patented “gold standard version of the nootropic citicoline,” for which the brand has an exclusive license with the ingredient manufacturer Kyowa Hakka Bio to include it in protein bars.

“When we were evaluating different brain health ingredients, Cognizin really stood out because it is the second most studied supplement on the planet, behind creatine, which is also in our new high protein line. But it has such a robust set of studies. It is credible and functional and it also is one of these magic ingredients that is stable and doesn’t create formulation issues around taste or texture,” Gamsey said.

“But we also have other brain health ingredient in our brain blend that support brain energy and cognitive function,” he added. “We include vitamins B 12 and D3, both of which play important roles in neurological health and are nutrients a lot of people are chronically under consuming. All of our bars have omega-3s that support brain structure. We have lion’s mane, which is an adaptogenic mushroom, and we have ashwagandha, which is one of the most well studied adaptogens for stress resilience, which matters because chronic stress is one of the most documented contributors to cognitive decline.”

Altogether, he stressed, “we have the most robust set of brain supporting ingredients in our bar, and I think it’s been one of the reasons it’s helped us stand out.”

The brand also stands out in the increasingly crowded brain food market because it does not make exaggerated claims that Gamsey said may be tempting to some to make because they are easy to understand, but which could harm a brand’s reputation long-term.

“There are a lot of brands out there that play fast and loose with the rules, and I think the food industry can sometimes be the Wild West when it comes to health claims. But, I think, those brands will eventually be exposed. And, I think, brands that do things the right way will build credibility and trust and be the ones that endure,” he said.

Next steps

Looking forward, Gamsey said Mosh will be “heads down and focused” on the new product launch and supporting its increased distribution, but longer term he said the company wants to solidify its position as a pioneer in the brain health food category.

“We want to be the first brand anyone thinks of when they think about brain nutrition. I think we are already at the front of the back, but we want to extend our leadership and continue to grow and scale and meet customers where they are,” he said.