CPG Playbook   //   January 17, 2024

Exclusive: C4 owner Nutrabolt acquires a minority stake in Bloom Nutrition

Nutrabolt, the parent company of C4 energy drinks, is acquiring an approximately 20% stake in supplement brand Bloom Nutrition as it looks to build its portfolio in the wellness and nutrition spaces.

This is the first time Nutrabolt will hold a minority investment of this kind, CEO Doss Cunningham told Modern Retail. Under the deal, which was finalized this week, Nutrabolt will become Bloom Nutrition’s largest investor. Nutrabolt’s other brands include Cellucor and Xtend Energy, the latter of which it acquired in 2017.

Nutrabolt’s investment is part of a larger $90 million financing plan for Bloom Nutrition that also includes Amberstone, a consumer investment firm, and Clayton Christopher, the founder of Sweet Leaf Tea. Gregory LaVecchia and Mari Llewellyn, who co-founded Bloom Nutrition in 2019, will remain majority shareholders in the company, according to information shared with Modern Retail.

Nutrabolt launched its first product line, Cellucor, in 2002. In 2011, Nutrabolt introduced C4 workout powder, and in 2018, it debuted C4 carbonated beverages. While C4 does not disclose revenue, the company has grown year-over-year, it told Modern Retail in a previous interview.

Nutrabolt’s investment in Bloom Nutrition comes not long after it received its own cash infusion. In December 2022, Keurig Dr Pepper bought a 30% stake in Nutrabolt for $863 million. Now, Nutrabolt is taking on the role of investor as it looks to become a leading health and wellness company, Cunningham said.

“I think the future for our company is to do both organic brand-building and participate in what we think is highly accretive M&A,” he said. “Over the next several years, we’re going to be focused on building our legacy brands, partnering with brands like Bloom to try and help them accelerate what they’re doing. And, there may be some full acquisition opportunities in the future, as well.”

Bloom Nutrition sells supplement powders packed with protein, greens and superfoods. It originated as a direct-to-consumer brand but now sells products via its website, Target, Amazon and Walmart. Llewellyn has said she was inspired to create Bloom Nutrition as a way to help women reach their fitness goals after embarking on her own weight loss journey.

Nutrabolt began investment talks with Bloom Nutrition in early 2023, Cunningham said. He believes Bloom Nutrition adds “another dimension” to Nutrabolt’s existing portfolio of performance products due to its emphasis on overall wellness and gut health. In addition, energy drinks have a male-dominated audience, Cunningham acknowledged, and by investing in Bloom Nutrition, Nutrabolt hopes to reach more women. Nutrabolt’s investment will provide Bloom Nutrition with capital for product innovation and “expanding internal capabilities,” according to the company.

In a statement, Bloom Nutrition’s LaVecchia said he was “thrilled” to work with Nutrabolt. “Their expertise and resources as industry leaders will enable us to scale effectively, fuel sales growth and accelerate innovation,” he said.

The better-for-you boom

So-called better-for-you energy drinks, nutritional supplements and vitamin powders have gained more attention and market share over the past few years, largely thanks to the pandemic’s emphasis on healthy habits.

“The pandemic kind of empowered people to take greater control of their self-care,” Joan Driggs, vice president of content and thought leadership at Circana, told Modern Retail. Today, dozens of energy and nutrition brands say they provide health benefits, “and people do want to make small, meaningful, positive changes in their life,” she said.

As Driggs mentioned, items like drinks and gels are less expensive than other purchases consumers could make for health, wellness or lifestyle purposes. “It’s small, it’s affordable, it’s accessible and it’s also discovery — people are finding new flavors, new benefits and they’re curious,” she said.

All of this makes better-for-you items a common target for takeovers. Last year, for example, the better-for-you foods manufacturer Wella acquired Thunderbird, a nutrition bar company, while the private equity firm Citation Capital bought a majority interest in Cibo Vita, the marker of Nature’s Garden products.

“Currently, there’s a remarkable surge of interest in the better-for-you CPG sector, and it’s hardly unexpected that companies are strategically investing in related businesses,” Michael Jones, CEO and managing director of Science Inc., told Modern Retail via email. For a company like Nutrabolt that invests so much in energy drinks, “diversifying go-to-market strategies to align with consumer trends… is a savvy approach,” he said.

Finally, powdered supplements like Bloom Nutrition’s, in particular, may be attractive to companies that sell beverages, Anna Whiteman, principal of Coefficient Capital, told Modern Retail. “It represents a natural extension of their existing product lines, but often with a favorable margin profile, similar high frequency [and] repeat usage behavior and stronger digital penetration,” she said.