Liquid Death, a canned water company, made headlines on March 11 by announcing a $67 million funding round at a $1.4 billion valuation and reaching $263 million in sales in 2023.
Despite being in a challenging category for investors, Liquid Death has managed to raise over $267 million in venture funding. Science Ventures’ managing director, Michael Jones, explained that they backed Liquid Death due to its disruptive potential in the industry, aiming to challenge big players like Pepsi and Coke.
Cutting through the fizz
Innovative beverage startups are changing the game by creating new drink categories, much like tech companies approach innovation. Liquid Death, drawing inspiration from beer marketing, has found success not only on shelves but also at various social venues.
The market is shifting towards healthier alternatives, with startups like “Not Beer” targeting consumers looking to reduce alcohol consumption while still engaging in social activities.
Who else is popping?
The beverage industry is attracting investment in brands offering unique products like infused drinks with vitamins, minerals, and botanicals. Companies like Odyssey, Olipop, and Poppi have raised significant amounts to cater to health-conscious consumers.
Recognizing the market trend, investors are eyeing potential acquisition targets in the beverage sector, with successful exits like BodyArmor and Bai highlighting the sector’s lucrative opportunities.
New innovation cycle for beverages
The beverage industry is experiencing a new innovation cycle, evident from the increasing number of startups and exhibitors at trade shows. Despite funding challenges, resilient brands that resonate with consumers and show growth potential are attracting investor interest.
Identifying long-lasting brands amidst changing consumer trends remains a challenge for investors, requiring expertise and careful evaluation. For those willing to navigate the complexities, the beverage sector promises strong returns.
