Sproud raises $6.6M for North American expansion of pea-protein milk
Dive Brief:
- Sproud, a Swedish manufacturer of plant-based milk sourced from yellow split peas, has raised $6.6 million (4.8 million pounds) from London-based VGC Partners to fund its expansion in the U.S. and Canada, as well as the U.K., according to Food and Drink Technology. The company will use the investment to expand its distribution and brand building activities and develop its vegan milk.
- Sproud, which launched in Sweden in 2018, entered the United States and Canada in August 2020. Its milk is sold direct to consumer, on Amazon and at a small number of retailers in four shelf-stable varieties, including sweetened, unsweetened, chocolate-flavored and a formulation for professional baristas.
- Sproud claims the split pea-based milk uses up to 10% less water than almond milk, and less land than oat or soy. This sustainable hook could give the company an edge in a crowded dairy alternatives market.
Dive Insight:
For Sproud, grabbing consumers’ attention in the competitive plant-based dairy market requires moving beyond the Nutritional Facts label and taking a multiprong approach. Oatly could provide a roadmap for the company to follow. Oatly, which was founded on the research of a Swedish food scientist into oat milk, first entered the U.S. market in 2016. By 2019, North America grew to be the company’s third largest market, supplying nearly one-fifth of its sales, after its home country of Sweden and the United Kingdom.
Oatly first grabbed a foothold in the U.S. market by supplying coffee shops such as Starbucks. Sproud is developing in parallel, recruiting brand ambassadors among baristas, who have helped the company develop recipes for coffee, smoothies and other beverages.
And Sproud is also mirroring Oatly’s sustainability pledge; the latter has committed itself to higher standards for its sourcing, manufacturing operations, supply chain and treatment of workers, according to its 2019 Sustainability Report. Similarly, Sproud has made its mission to create a dairy alternative with a taste closest to milk, while having the lowest carbon footprint possible. Its product has a 365-day shelf life, so avoids any emissions related to refrigerated storage. The use of yellow split peas, which is uncommon in the dairy alternative space, provides it an edge as a sustainable, versatile protein source. Ripple also makes its own pea-based milk and carbon-footprint-friendly sell.
Sproud also is making the case of its allergy-friendly split pea protein source and lower sugar content. It claims to be the first dairy-free alternative to win SugarWise certification, an international standard that confirms a product has no more than 5 grams of free sugars per 100 grams of food, and no more than 2.5 grams per 100 ml of a beverage. This makes it a lower-sugar option than many trendy alternatives such as hemp milk and oat milk, depending on the variety.
Despite the heavy competition, Sproud’s timing is good. The pandemic has already raised plant-based milk’s nutritional profile, and with the vaccine rollout continuing, may give way to sustainability as the next big hook for alternatives.