- Austin, Texas-based venture capital firm Springdale Ventures has secured $40 million for its Fund II, which is intended to invest in early-stage consumer brands in the food, beverage, health, and beauty, and pet sectors.
- The fund is almost twice the size of Fund I, which was launched in 2019, and includes returning limited partners, family offices, notable sports figures, and startup entrepreneurs.
- Springdale Ventures’ Fund II has already invested in 14 firms, including the whiskey brand Big Nose Kate, Asian-style hard seltzer company Nectar, and BloxSnacks, a children’s snack food brand.
- Genevieve Gilbreath, cofounder of Springdale Ventures, said the fund will invest in disruptive consumer brands from seed to Series A, aiming to make initial investments of around $1 million.
The venture capital firm plans to set aside 25-30% of the fund for follow-on investments. Fund II comes at a tricky time for fundraising, especially for venture capital funds, as the flow of capital slowed down significantly in recent years due to a more conservative approach by investors. However, Springdale Ventures was pleased to nearly double the size of Fund I and maintain much of its limited partners and other investors.
Springdale looks forward to exit opportunities with strategic multinational consumer packaged goods brands, despite their mixed track record in this space. Gilbreath believes that these strategic opportunities are still very much viable as large companies continue to struggle with innovation that resonates with customers. There is also the potential to sell to private equity firms or larger holding companies, and the venture capital firm is exploring the possibility of selling shares through a substantial secondary market in 2024.
On top of standard investment opportunities, Springdale seeks to provide startup founders with industry connections and support, utilizing their experience as consumer entrepreneur operators. Their focus is to help startups navigate and overcome potential hurdles by providing connections, coaching, assistance in hiring, and more. Despite the challenges, Springdale remains optimistic and committed to supporting businesses in the consumer market, which they believe to be substantially underfunded despite making up 70% of the US GDP.
They credit the rising trend of businesses partnering with celebrities or social media influencers to build a presence online, thus driving more consumer engagement. Springdale’s own BloxSnacks is an example, gaining expanded reach by associating its product with Minecraft influencers. Gilbreath does caution against brands agreeing to too many retailers before building real consumer traction.
