DTC’s Daily Digest brings you the latest news on the world’s fastest growing direct-to-consumer brands. In today’s edition: Purple Carrot launches plant-based incubator; Taft opens brick-and-mortar store; and Airbnb sees big losses ahead of possible IPO.
Purple Carrot launches plant-based incubator
Purple Carrot is getting into the venture capital space. The plant-based meal kit company announced the launch of The Garden Incubator, a new service aimed at scaling up early-stage plant-based companies.
The Garden will serve as an investor, incubator and launch pad providing a range of services to confirm product-market fit and establish confidence for future investments, Purple Carrot said.
The company will support entrepreneurs through strategy, branding, marketing, e-commerce, operations, fulfillment and data analytics services. It also will provide participating companies with up to USD$250,000 in seed funding.
The Garden is sponsored by Unovis Partners, an investment firm focused on start-ups developing plant, fungi and cell-based animal protein alternatives. Its portfolio features more than 30 brands, including Beyond Meat, New Wave Foods and Zero Egg. Funding will be provided through the firm’s evergreen New Crop Capital fund.
“With The Garden our goal is to accelerate the positive trajectory of qualifying brands, improve their focus and enable rapid and improved distribution in the U.S. and beyond,” said Andy Levitt, founder and chief executive officer at Purple Carrot. “The de-risking of brands for future follow-on investment will be a key differentiator for this service.”
Taft opens brick-and-mortar store
Kory Stevens, Taft’s founder & CEO, told Forbes that “when speaking quantitatively, our target market is 25-40 year-old men in big cities. When speaking qualitatively, which I prefer, we are going after the people that want to stand out, be a little different, and take pride in how they dress.”
Top venture capitalists like Fifth Wall and basketball players Dwyane Wade and Andre Iguodala took notice of Taft, bringing outside investment to the brand for the first time in 2018 after earning USD$20m in less than four years.
“Seeing our products displayed on shelves and in the hands of our customers is a dream come true,” said Kory Stevens, founder of Taft. “Being an online-only brand, we miss out on the magical moment when a customer sees the shoes for the first time and tries them on. We’re super excited for people to get that experience in our first store.”
Airbnb sees big losses ahead of possible IPO
Airbnb lost about USD$100m before interest and taxes in the second quarter this year, a big swing from the profit of USD$10m it made in the year-earlier period, according to financial information viewed by The Information. The loss, driven by higher marketing and administrative expenses, is the latest sign that Airbnb is investing heavily in growth ahead of its planned public market debut next year.
In the first quarter, Airbnb’s loss more than doubled to USD$306m, The Information previously reported, due to a big increase in marketing expenses. While Airbnb has been profitable – it made USD$18m before interest, taxes, depreciation and amortisation last year – the first half losses may complicate its ability to portray itself to investors as a tech company that makes money. News of the second quarter results came the same day that COO Belinda Johnson said she would step down.
Airbnb can point to continued growth. Revenue in the second quarter was up 34% to USD$1.2bn, bringing first half growth to 33%. However, 47% growth in expenses in the first half outstripped the revenue increase. The company has increased spending heavily on marketing to attract more people to rent their homes on Airbnb.
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