Remember Prepd? The “lunchbox you won’t be ashamed to carry” raised over $1 million on Kickstarter in 2016, and now it is returning with an iPhone 5c-esque sequel that is both cheaper and more colorful. Prepd, in case you missed it, isn’t some kind of IOT, smart, next-gen lunchbox. Rather, it’s an unashamedly premium take on the […]
Prepd, in case you missed it, isn’t some kind of IOT, smart, next-gen lunchbox. Rather, it’s an unashamedly premium take on the lunchbox built by two designers who were sick of lugging around ugly boxes containing their food. Style aside, it is also designed to keep portions healthy. To date, over 50,000 lunchboxes have been sold worldwide, according to the company.
The new Prepd ‘Colors’ Kickstarter cuts the price of the product to $39 (or $35 for the first 24 hours of the campaign), which is down from $50 in the last Kickstarter . The original version has a recommended retail price of $69 and the new edition is set to sell for $49 after the campaign is over.
The real difference with the new edition is that the elegant bamboo cover of the original version is replaced with a colorful top that uses the same magnetic lock mechanism. Likewise, the same high-quality leak-proof Tritan containers and magnetic reusable cutlery are included in the set.
Founders Chris Place and Will Matters told TechCrunch that they have made a few small optimizations but the goal is to offer some variation — the colors include blue, peach, mint or grey — and make the product more affordable.
“It includes the same benefits of the original product but in a more simple version at a more accessible price point,” Place said in an interview.
“We’re amazed at how many people use it on a regular basis and the changes it makes to their life,” Matters added. “People love it but some say that they can’t justify spending $69 so we wanted to enable more people to get their hands on it.”
Two-and-a-half years is a long time between products, but Hong Kong/U.S-based Place and Matters said they’ve been busy working with retailer and partners, which have included Blue Apron, Bloomingdale’s and Nordstrom. Beyond that, they’ve been partnering with content makers and chefs to develop the companion app that works alongside the lunchbox.
The follow-up act is always tricky, particularly when a project massively exceeded its target as was the case with Prepd. The Kickstarter project is again looking to hit a minimum goal of $25,000 which will cover the tooling and processes to actually build the product. Since Prepd uses Kickstarter in the traditional way — as a platform to validate an idea rather than marketing an existing product — the finished product isn’t due to ship to backers until March 2019, although a number of prototypes have already been developed.
Prepd has bootstrapped itself to date, despite Place and Matters admitting that they have fielded interest from VCs. For now, the duo said they are focused on this Kickstarter campaign but they admitted that they are looking to “energize” their community of lunchbox owners by developing new content for the Prepd app that could include cooking shows or chef live streams.
“We’re looking to harness the community and do what Peloton has done [for cycling] but for cooking,” Place said.
Full details on the new Prepd product can be found on Kickstarter here.
Micah Rosenbloom Contributor Micah Rosenbloom is a venture partner at Founder Collective. More posts by this contributor Startups need to respect the laws of retail physics Is VC The Right Money For Fintech? These days my Instagram feed feels more like QVC than a social network. And many of these companies are enjoying tremendous success […]
These days my Instagram feed feels more like QVC than a social network.
And many of these companies are enjoying tremendous success pitching natural deodorants, unique underwear, creative candles, glam glasses, stunning shoes — all manner of well-crafted microbrands. We’re witnessing a cambrian explosion of new consumer startups.
For the last couple of years, building a successful startup has seemed as simple as picking an out of favor category like ketchup and turning the most mundane of condiments into a $100M+ exit! Why try to build a robot or AI company when you can just modify and repackage a topping?
But how should founders evaluate the markets for mattresses and men’s health? What heuristics should an investor use to weigh Hims and Hubble, or to compare AllBirds and Away? And what is the right kind of founder for this sort of startup? Do you look for the designer with an unimpeachable aesthetic sense? Or an MBA who’s run the numbers on every facet of the fashion industry?
It’s far from clear at this point, but I think there are a few emerging ground rules:
It’s more Science than Art
What strikes me as most unusual and unpredictable is that most of these companies were founded by entrepreneurs with analytical, business training. They’re strong on finance, marketing, and customer acquisition. It’s not what you would have expected in categories noted more for an ineffable “cool” factor than feature lists. Creative design helps a brand stand out, but accounting acumen is what keeps it alive and on its way to becoming a unicorn.
It turns out that much of the same playbook for building and scaling a software company applies to a modern CPG startup. In many ways, Casper isn’t so different from Slack, and they are certainly closer in spirit than a direct competitor like MattressFirm.
This is why you see a migration of founders and VCs like me playing in categories previously out of bounds for tech investors. Whether its finding the latest targeting tools or closely monitoring customer NPS, this is the DNA needed to be successful. For this reason, VCs are able to pattern match, somewhat, based on what they’ve seen working in other aspects of their investing.
Perhaps it’s a coincidence that three amazing founding teams bet on beds, but I’d wager the state of the mattress market is partially responsible for their success. The mattress business is essentially a duopoly run by private equity firms who have made major investments in real-estate and an in-store sales model. As a result, we see less experimentation and artificially high prices.
Compare the mattress industry to the meal kit delivery business which had to contend with a wide variety of substitute food products, from Domino’s to DoorDash and supermarkets to Soylent — not to mention spoilage, high levels of customer churn, etc. As a result, companies in this space have had a harder time dominating their respective categories. Sadly, there is no amount of clever branding or subway advertising that will eliminate those realities.
What’s the million-dollar insight?
The first Casper mattress was the 50,001st mattress sold by Philip Krim. Prior to manufacturing his own beds, Krim built a drop ship business serving other manufacturers and learned which levers to pull in order to attract customers and generate demand. It was this seemingly mundane insight – that you could box and ship a mattress via a carrier instead of onboard a large truck that allowed him to scale much faster than Sleepys and generate $100M+ in sales just a couple of years after founding.
Similarly, ButcherBox and Daily Harvest each ignited a boom in direct-to-consumer food delivery. These companies recognized that fresh and immediately frozen products limit spoilage and allows for much easier transport. While competitors had to worry about organic kale rotting in a fulfillment center, these companies could focus more attention on customer acquisition. This insight coupled with smart marketing, virality, and high NPS has helped them both garner millions of dollars of weekly sales.
It’s not nearly enough to say, “The competitors don’t get it.” or this is for “Gen Z.” Instead, like with all start-ups, the founders need to identify that non-obvious, often contrarian, insight. This is usually less of a product “A-Ha!” and is more likely an arbitrage opportunity in a dysfunctional market.
Spend Carefully, Your Potential Buyer Will
Digital vertical native brands can be compelling investments, but they are unlikely to have deal dimensions, in terms of multiples or absolute exits, that we see with traditional tech investments.
Just look at a few recent sales of DNVBs. The absolute dollar amounts are reasonable, but the multiples are small relative to tech, ranging from 1.6X to a potential 8X (no doubt subject to earn outs), with the average being in the 2-3X range. On the bright side, these acquisitions do tend to consummate quickly, often within a few years of their founding.
If you finance a DNVB like a deep tech company with heavy reliance on tens of millions of venture capital, founders and investors are likely to see little in return. As Jason Del Ray recently wrote at ReCode, many of these brands are skipping VC all together.
It’s important to remember that these sales are predicated on impressive revenues. Cruise Automation can get acquired for $1B because its technology could be the basis for a new kind of car, but don’t expect Kellogg’s to acquire a pre-launch cereal company for a similar sum.
DNVB investing is here to stay as there is a fundamental shift going on in retail and how consumers shop. Unless you’re Kylie Jenner with a hit reality show, investors would be wise not to dismiss that nerdy MBA or former consultant pitching the next great brand.
Amazon is picking up the pace when it comes to unveiling its line of “stores of the future,” today opening its second cashier-less Amazon Go convenience store in the last week. More Amazon Go locations are expected to land in other cities soon, though the company has yet to confirm any plans.
The latest location is its third overall and third in Seattle, where it’s headquartered. The 2,100 square feet store sits on the corner of Boren Ave. and Thomas St. and is its largest yet. The first iteration of the Amazon Go store was 1,800 square feet; it opened its doors to the public in a surprise opening in December 2016. The second, measuring 1,450 square feet, began doing business last Monday.
In case you’re unfamiliar, Amazon Go stores cut out the check-out process by charging customers for what the pick up in-store using the Amazon Go app. The company relies on cameras, which are mounted all over the stores, and weight sensors on the shelves to track what shoppers are picking up and to make sure they are charged correctly.
The newest store will have breakfast, lunch, dinner and snack options for sale, a stocked selection of foods, including bread, milk and locally made chocolates, as well as Amazon Meal Kits, a product the company launched in 2017 to go head-to-head with Blue Apron and other meal kit delivery services.
People don’t eat enough fruit and vegetables, that’s despite an embarrassment of options today that include fast grocery delivery and takeout services with a focus on health. A study from the U.S-based Center for Disease Control and Prevention (CDC) released last November found that just one in ten adults in America “meet the federal fruit […]
People don’t eat enough fruit and vegetables, that’s despite an embarrassment of options today that include fast grocery delivery and takeout services with a focus on health.
A study from the U.S-based Center for Disease Control and Prevention (CDC) released last November found that just one in ten adults in America “meet the federal fruit or vegetable recommendations” each day. The bar isn’t that high. The recommendation is just 1.5-2 cups of fruit and two to three cups of vegetables per day, but failing to meet it can put people at risk of chronic diseases, the CDC said.
The problem is universal the world over, but perhaps most acute in the U.S, where finding healthy food is easier than ever. Amazon’s same-day grocery deliveries, make-it-at-home services like Blue Apron and various healthy takeout services have helped some people, but no doubt there’s much more to be done for standards to be raised across the nation and beyond.
That’s where one early-stage startup, Kencko, is aiming to make a difference by making fruit and vegetable more accessible. Its thesis is that wholly organic diets are daunting to most, but packaging the good parts in new ways can make it easier for anyone to be more healthy.
The company’s first offering is a fruit drink that can be made in minutes using just a sachet, water and its mixer bottle.
Kencko currently offers five different organic fruit and vegetable mixes
Just add water
Unlike other ‘instant’ mixer options, Kencko uses freeze-drying to turn fruit and vegetable mixes into sachets without compromising on health. That process — which is similar to how NASA develops food for astronauts — retains minerals, protein, vitamins and all the other good stuff typically lost in healthy drinks, the startup said. The fruit and vegetables used are organic and sourced from across the world — that’s broken down into more details on the Kencko website — while the mixes don’t contain sugar or other additives.
Kencko customers make their drink by mixing the sachet with water and shaking for one minute. Each sachet is 20g and, when combined with water, that gets you a 160g serving that has a 180-day shelf live. There are six different combinations, each one is a mixture of six fruit and vegetables.
Unlike others that pair with water, Kencko actually includes fruit pieces and seeds — I tested a batch. That’s pretty unique, although it is worth noting that some of the more berry fruit heavy combinations mix less efficiently than the plant-based ones, at least from my experience. As someone who lives in a city where fresh fruit and vegetables are easily found — thank you, Bangkok — I’m not the target customer. But I can readily recall living the busy 9-6 office life in London a decade ago, and back then I’d have been curious enough to at least take Kencko for a spin in my quest to be a little healthier.
Kencko is also affordable when compared to most health food options, which tend to be positioned as premium.
Packs are priced at $29.90 for ten sachets, $74.50 for 30 and $123.50 for 60. The startup offers a ‘Lifetime Founding Member’ package that gives 30 percent off those prices for an initial charge. That’s $32 for those wanting 10 sachets packages, $79.90 for 30 and $129 for 60.
Two of my Kencko mixes
More than pressed juice
Kencko — which means health in Japanese — is the brainchild of Tomás Froes, a former tech worker who got into veganism after being diagnosed with acute gastritis.
Froes, who is from Portugal and once ran an artisanal hot dog brand in China, was told that his ailment was treatable but that it would require a cocktail of pills for the rest of his life. Seeking an alternative, he threw himself into the world of alternative health and, after settling on a 90 percent fruit and vegetable diet, found that his condition had cleared without medicine.
Keen to help others enjoy the benefits of his journey, he began talking to nutritionists and experts whilst trying to figure out possible business options. In an interview with TechCrunch, Froes said he settled on a new take on the existing ‘health drink’ space that he maintains is inadequate in a number of ways.
“The end goal is to help consumers reach the recommendation of five servings/portions of fruit a day,” he explained. “That would be impossible to do if we excluded the seeds and bits of fruits like cold-pressed juice companies do. They press the juice out of the fruits, leaving the most nutritional part from pulp and the seeds out.”
“We blast freeze fruit and vegetables at -40 degrees which allows us to maintain the same nutritional properties as fresh fruit for longer periods. We then use a slow heat process of 60 degrees to evaporate only take the water-based parts without damaging nutrition,” Froes added.
Added that, Froes said, Kencko helps cut down on the use of plastic by using the same mixer, return customers only require new sachets.
As proof of Kencko’s versatility, he brought his mixer and sachets along to the vegan cafe we met at earlier this year when I visited London, putting me to shame for buying the cold pressed option — which was no doubt more expensive, to boot.
Kencko is based in New York but with a processing facility in Lisbon, Portugal. It is heavily focused on the U.S. market where it offers delivery in 24-48 hours, but it also covers the UK and Canada. There are plans to increase support, particularly in Asia.
Kencko’s Apple Watch app is in beta with selected users
Building a health food brand
Kencko was formed in 2017 and, after landing undisclosed seed funding, it launched its product in March of this year. Already it has seen progress; the startup recently entered the TechStars accelerator program in London as one of a batch of ten companies.
“I’m excited to work with Tomas and the Kencko team,” Eamonn Carey, who leads TechStars in London, told TechCrunch. “I first read about them on ProductHunt and bought into their mission straight away. Once I tasted the product for the first time, I was sold — both as a subscriber and an investor.”
Froes told TechCrunch that drinks are just the first phase of what Kencko hopes to offer consumers. He explained that he wants to move into other types of food and consumables in the future to help give people more options to get their daily portion of fruit and vegetables.
Up next could be Apple-based snacks. Foes shared — quite literally — a new batch of snack that’s currently in development and is made from the fruit. He believes it could be marketed a healthier option than crisps and other nibbles people turn to between meals. Further down the pipeline, he said, will be other kinds of food that maintain the 100 percent organic approach.
Beyond food, Kencko wants to build a close bond with its customers. It is developing iOS and Apple Watch apps that help its users to track their fruit and vegetable consumption, and more generally make their diet and routine healthier.
With the membership package and apps, it becomes clear that Kencko aspires to build a brand and not just sell a product online. That’s double the challenge (at least), and that makes the company one to watch.
Already it has found some success within tech circles such as TechStar’s Carey — people who aspire to eat and drink better but are pushed for time — but if Froes is to even begin to deliver on his mission then Kencko will need to go beyond the tech industry niche and attract mainstream consumers. For now though, the product is worth close inspection if you think your lifestyle is in need of a fruit boost.