CPG Playbook   //   November 22, 2023

After an investment from Kim Kardashian’s firm, Truff enters its next phase of growth

More than a year after being announced, Kim Kardashian-founded private equity firm Skky announced its first brand investment by taking a minority stake in hot sauce startup Truff. 

Since the buyout firm was founded in September 2022, Skky had been quiet about its deals. But in the last few months, Skky has been hiring Wall Street talent to staff up its team ahead of investment announcements; The firm has also yet to announce the dollar figure of its debut fund. 

For Truff, the Skky backing marks the first official round of outside capital the brand has received since launching in 2017. Truff was previously self-funded, in addition to taking on some debt. Truff’s founders view this investment as a culmination of its marketing momentum it’s accumulated over the past couple of years. Truff has tried to build its name recognition through collaborations with quick-service restaurants and film studios. Truff and Skky didn’t disclose any financial terms, but the founders said the goal is to take advantage of both the financial investment and Skky’s branding resources to fuel Truff’s next phase of growth.

Co-founders Nick Ajluni and Nick Guillen said the company wasn’t looking to raise money when the idea popped up. The duo reached out to Skky through mutual friends to kick off the conversation. 

“We weren’t going out and shopping the market to raise money, but we’d heard about the fund and it sparked our interest,” said Ajluni. “The conversation with them started nine or 10 months ago and here we are today.” The deal also comes at a slower time for fundraising, especially among young CPG brands. 

Guillen pointed to a big draw for partnering with the firm: both Kardashian and Skky’s other co-founder, Jay Sammons, have a successful track record of building consumer brands. Outside of capital, the founders say the biggest benefit of partnering with Skky is blending the talents of both teams to bring bigger awareness to the Truff brand. 

“There are so many people that know about Truff and so many that do but maybe haven’t tried it,” Ajluni said. Much of Truff’s current roadmap remains the same — with a slew of campaigns and product releases due out in the first and second quarter of next year, Ajluni said. More retail launches are also on the way to build on Truff’s current footprint of 20,000 doors. “We hope this partnership will help amplify them,” he said.

This announcement follows months of quiet speculation around Skky’s first investment targets. Some onlookers weren’t shocked by the Truff anouncement. “Going into food and beverage makes a lot of sense because of how tied to culture these brands can be,” Dhruv Patel, founder of the Celebrity Packaged Goods newsletter, said.

Part of Truff’s strategy to build brand awareness involves collaborating with national food brands — and most recently entertainment properties to raise its profile. That first began in 2021, when Truff launched a test run at select Taco Bell locations, selling co-branded items like nacho fries — which Taco Bell kept bringing back due to its popularity. Last year, Truff also collaborated with Hidden Valley Ranch on a sauce.

In April, Truff released a limited-edition trio of sauces tied to the release of Nintendo’s Super Mario Bros Movie — with more than 15,000 people signing up for a waitlist to be notified when the limited-edition collab launched.

Looking for product differentiation also appears to be a pillar for Skky. In the release, Kardashian pointed to Truff’s having “single handedly” brought truffle-infused products into the mainstream while building a following around the brand.

Patel said that some promo posts by Kardashian can no doubt place a spotlight on Truff. “Someone like the Kardashian family can boost a brand by opening doors that we’re not thinking of,” he said, whether it’s brand activations or larger collaborations. “They [Truff] already have the distribution in place, so that’s an advantage going forward.” 

With the Skky and Kardashian ties, Truff will largely stick to its current strategy of digitally-driven marketing, and utilizing pop culture moments as tie-ins to much of its marketing efforts. “We’ll stay true to our scrappy roots, but we’ll just have a bigger team and more resources that are all rolling in the same direction,” Guillen said.

“We want to use the Skky platform to make Truff a pantry staple for more households,” Ajluni said. “But these things take time, some of the biggest brands across categories are 10, 20, 30 years old. We can’t hack time but we can hack awareness.”