NEW YORK — On Oct. 27, Better Choice Company has raised the total and final funding amount for its series F financing round to $21.7 million, after receiving a significant investment from Cambridge SPG, a venture capital and private equity firm working with CPG companies. 

"We have been following the growth of Better Choice for the last 2+ years and are extremely excited to lead the Company’s final Series F round," said Filipp Chebotarey, managing partner and chief operating officer of Cambridge SPG. "We see tremendous growth potential for the pet health industry, specifically in Asia, and are excited to partner with Better Choice at a transformational point for the business."

The company, which acquired Halo, Purely for Pets in December 2019, announced Oct. 2 it had raised $17.8 million in funding as part of its series F round, of which $11 million came from management and board members. This figure was updated to $18.9 million on Oct. 13, of which more than $11.3 million was contributed by management and board members. This latest figure of $21.7 million represents its final result of the series F funding round.

“In addition to further strengthening our balance sheet, this additional capital allows us to quickly accelerate growth in Asia, specifically China,” said Michael Young, chairman of the board of Better Choice Company and a key investor in the series F financing

Young added the company will utilize part of its series F funding to improve its e-commerce and in-person sales presence in Asia, including marketing and inventory efforts as well as expanding its internal sales team. 

"We are all very excited about reaching this pivotal point for Better Choice's capital structure," Young said. "I have been an active investor in Better Choice for more than two years, having watched it grow into the multi-channel global player it is today. The positive secular trends in the pet sector have never been so strong, and I believe that Better Choice is extremely well positioned in e-commerce, DTC and Asia to capitalize on the market opportunity.”

Better Choice Company's second quarter earnings in Asia totaled approximately $2.4 million, representing a 16% sales increase from the first quarter. 

"With this type of exponential growth, we see a tremendous first-mover advantage in Asia and are excited about making this a very meaningful contributor to revenue in the near-term," Young said. "Our international operations, sold through domestic distribution networks, account for approximately 20% of net sales through the first half of 2020. We could see this reach 40% or more as the market continues to mature.”

Better Choice Company is projecting an estimated $45 million in revenue for its 2020 fiscal year, of which online sales are expected to account for $30 million. Direct-to-consumer e-commerce sales will represent approximately $13 million. Industry-wide e-commerce sales are expected to account for 30% of the company’s total sales in 2020, compared to 22% of sales in 2019.

"Our pet business continues to outperform our internal forecasts, and we are excited to be well-positioned in a rapidly evolving macro-economic environment," said Werner von Pein, chief executive officer of Better Choice Company. "The COVID-19 pandemic has accelerated the shift to online purchasing in the pet sector. With approximately 65% of our sales at Better Choice expected to be generated online, we have been taking advantage of this rapidly changing dynamic by building a recurring customer base. In addition, we expect many positive results within our Asian business, especially as we continue to ramp exports into China."

The company’s international sales “have grown significantly,” according to Better Choice Company, and are projected to reach $10 million this year. It expects roughly 50% growth in international sales in 2021, driven by key markets in China, Korea and Japan.

In June, Better Choice Company filed and received Product Import Registrations from the Ministry of Agriculture and Rural Affairs of China, allowing the company to export 15 dog and cat food products under its Halo brand to the country. 

In addition to expanding its direct-to-consumer reach and international distribution, Better Choice Company will use its latest capital funding to reduce its outstanding term loan, which is expected to decrease the company’s monthly cash interest by approximately $110,000.

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