Owl’s Brew, a tea-based seltzer producer, closed a $ 9 million Series A round. The funding follows an impressive year of growth for the RTD brand: After launching a tea-based seltzer water line in early 2020, the brand grew 918% during the year and expanded to 18 markets.
Series A backers include Formidable Asset Management, Cambridge SPG, Connecticut Innovations and Tidal River, alongside notable names like Sam Taylor-Johnson and Jeannie Mai.
The brand was launched in 2015 after co-founders Jennie Ripps and Maria Littlefield, industry vets and tea enthusiasts, noticed a huge gap in the market when it comes to consciously produced alcoholic beverages. Thus, Owl’s Brew was originally born as a line of inspired tea-based blenders; simply add the alcohol of your choice and shake, for low effort, high reward cocktails.
âWe want to be what clean beauty is in the alcohol space,â says Ripps, a tea sommelier who has worked with Momofuku, Sweetgreen, Soho House and The Edition hotels. âIn this industry there is such a lack of transparency in the packaged products, especially with alcohol, there are so many descriptions or cryptic varieties. What do you even drink? Real raspberries are unclear. Why is your raspberry seltzer?
From now on, their flagship products are fortified teas; sparkling, effervescent, slyly alcoholic thin cans flavored with real ingredients seemingly taken from an apothecary’s or farmer’s market; think raspberry watermelon white tea and an English breakfast with crisp lemon and lime. All cans are 4.8% sweetened with a pinch of cane sugar.
The seed cycle will fund distribution and product marketing initiatives to build on this momentum. âOur growth is 167% year over year and we are available in 32 states,â says Ripps. âIn 2020, we started to see 20 or 30 cases selling in a small store. Our sales rate is slightly over-indexed to industry by one and a half times.
âWe started throughout 2020, we saw the velocity and we understood that there was this great opportunity,â she continues. âWe want to raise funds to grow and keep pace. “
The figures are particularly astounding after a year when the duo were unable to market anything in situ. No visitation accounts, no on-site education; with closed bars and a travel veto, they had to rely on the product being on the shelves. âIt’s great to see that consumers really like to see your brand on the shelves and think our brand looks cool. And it resonates with them. They don’t need that push. Ripps said.
The funds raised from Series A will be used to grow, build a team and amplify Owl’s Brew’s âhealthy drinkingâ mantra. âIt’s about feeding the people on the ground to support our distributors,â says Ripps. “We are building a sales team and building permanent marketing and marketplace in a way that fosters authentic partnerships with drinkers.”
A main pillar of funding? Implementing stronger systems will help keep Owl’s Brew accessible. âWhat is really important for us, in terms of distribution, is to keep the price accessible. We think so many better-for-you drink options in this category are really, really expensive, âLittlefield explains. “We’re really working to keep that $ 9.99 price point alive so you can enjoy great ingredients – products like these shouldn’t be a treat.”
Compared to sweeter seltzers, Owl’s Brew aims to be adjacent to health; relying on teas and natural ingredients to flavor the options. Since the brand’s launch in 2015, the duo have experienced a huge category shift, with more brands embracing transparency and health-conscious ingredients, while adopting buzzwords like “clean,” “naturally sweet” and “organic”.
While âsugar-freeâ and âcalorie-freeâ are frequently abandoned in the RTD world, Ripps points out how difficult it is to really achieve this.
âWe went to 20 different contract breweries to find out if they would brew our teas,â says Ripps. âNo one would. They refused. All the other producers have little sachets of flavors that they put in their seltzer base. We wanted to brew our flavors from scratch and no contract brewer would – it was too much work for them.
âThere is no health benefit to these flavor packs! Think of the raspberry aromas, you won’t get any vitamin C or antioxidants. We wanted to brew our teas from scratch and keep all of those draws. So we had to find a producer and a manufacturer who wanted to partner with us and share this vision. We wanted to make our products the right way.
Funding is also planned to help Ripps and Littlefield continue to make the voices of women heard in the alcohol industry. â64% of women in the United States drink alcohol,â says Ripps. “But in this category of alcoholic beverages, 96% of CEOs, the people who develop the flavors and the people who market these products are male.” They are happy to send free products to events run by women; book clubs, seminars and others.
As Ripps and Littlefield continue to push their conscious consumption narrative, a portion of the funds will be dedicated to innovation. The first new product? A warm and spicy cranberry and chai seltzer for the colder months. âOne of my big initiatives on my plate is the drinks initiative,â says Ripps. âWe’re going to publish a lot more of what we put in our drinks to force this dialogue in our industry. We have the spicy seltzer chai, and we want to keep pushing innovation like this. “
âWe have seen such a big change,â says Littlefield. âConsumers are starting to read ingredients and labels and dig deeper into what they’re drinking. The demand and the velocity of our products is crazy.