Q4 Featured Founder | Sun & Swell

The 2nd New Majority founder currently fundraising from YOU this quarter

Hello New Majority Investors! 

Before we delve into Sun & Swell, our latest Featured Founders, we wanted to provide a quick update on Throne and Co-Founder Jessica Heinzelman, our previous Featured Founder and podcast guest. Throne is building a network of clean, reliable, and smart public bathrooms to expand bathroom accessibility for everyone. They are wrapping up their Wefunder campaign on October 20th! 🚽🌟

Sun & Swell

This week’s featured founder is pioneering sustainable snacking – say farewell to single-use plastic packaging and hello to Sun & Swell’s ground-breaking, plant-based, and biodegradable packaging!

First, some context:

• 🤔🚮Have you ever noticed a pile of plastic wrappers building up in your trash can and wished that enjoying your favorite snacks involved…less plastic? What about when you open your pantry?

• 🚯Grab-and-go packaged snacks are convenient but environmentally damaging, clogging up landfills with wasteful single-use plastic packaging that will never degrade.

• 🗞Sustainable food options have been hot in the headlines, but what about food and beverage packaging?

• 🌱📦Sun & Swell is pioneering planet-friendly, plant-based, biodegradable packaging, allowing you to enjoy the snacks and staples you love while minimizing your environmental impact.

This company is made for you if:

• ♻️You are committed to living more sustainably and reducing your plastic waste.

• 🛒💚You support sustainable innovation and advocacy across all industries, especially when that industry sells everyday items.

Tell me more

Sun & Swell is building the one-stop marketplace for foods without plastic packaging, reducing the environmental impact of the foods you love from production to disposal.  B2B and DTC, they are currently selling snacks, pantry staples, and bath products - all in packaging that can be composted at home or sent back to Sun & Swell to be composted.

Convinced? Invest today in Sun & Swell.

More details below.

The details

• Industry: Food and beverage🍽️, CPG (consumer packaged goods)

• Impact: Sun & Swell’s mission aligns with Responsible Consumption and Production (SDG 12) and Industry, Innovation, and Infrastructure (SDG 9).

• Team Diversity: Woman Co-Founder

• HQ: Sunny California 🌟

• Company size: 11-50

• Year founded: 2018

• Key Investors: 🏦Sun & Swell sports an impressive lineup of investors and advisors from Laird Superfood, HUMM Kombucha, P&G, and North Face. In a 2021 campaign on Wefunder, Sun & Swell raised around $700k from over 350 investors.

• Investment type: Priced Round*

  • *A Priced Round, also known as a priced equity round, means your investment will convert to shares when the company meets a specific financing goal. Sun & Swell is planning to convert investments to shares when they do a priced fundraising round in 12-18 months.

  • Pre-Money Valuation*: $18M 

    • *A pre-money valuation denotes the value of a company prior to it going public or receiving investments or external fundraising.

    • *A post-money valuation is the company’s estimated value after funds have been raised.

  • Investor Perks: Your $500 investment in Sun & Swell comes with a $40 gift card to enjoy some of their delicious snacks and experience their innovative packaging! 

• Deadline: November 7th

• Amount Invested: $190,158

• Number of Investors: 114  

• Goal: $300,000

• Min investment: $500

• Early traction:

  • 🚨Among Sun & Swell’s notable press includes features in Sierra Club and the LA Times.

  • 🍴Sun & Swell currently sells 35 SKUs* and plans to double their product range by Q1 of 2024.

    • *SKU, or stock keeping unit, is a unique code that is used to track a product's inventory.  35 SKUs = 35 unique products.

  • Sun and Swell has been operating since 2018 and saw over 50% compound annual growth rate in 2021 and 2022. 

Founding team

• Kate Flynn: Co-Founder and CEO, an MBA graduate from Harvard, a Tory Burch Fellow and PepsiCo WomanMade pitch winner. Kate also completed the Harvard + Pegasus Tech Accelerator program and possesses over a decade of experience in CPG/retail brand growth and strategy.

• Bryan Flynn: Co-Founder and Head of Sales, holds an MBA from Loyola Marymount and has played a pivotal role in taking startups (Scuba Analytics, AppFolio, Coraid) to $10M ARR.

Due diligence

Pros:

• ☝️⚙️Sun & Swell are first movers with their proprietary plastic-free supply chain and manufacturing line, and have invested a lot of time and money into making their machinery, packaging, and distribution plastic-free compatible.

• Sun & Swell is a certified B-Corp! Becoming a Certified B-Corp requires meeting standards of social and environmental impact, transparency in operations, and a legal commitment to be accountable to all stakeholders, not just shareholders. 

• 🙌Diversified Revenue Streams:

  • B2B: selling to wholesale customers, including corporate offices like Google and LinkedIn, global hotel chains like Ritz Carlton, and more.

  • DTC: selling through a combination of in-house online sales and 250+ partners like coffee shops, hotels, and offices.

  • Potential to add a future revenue stream that would include private labeling or co-branding using Sun & Swell’s plastic-free supply chain.

• 📈Sun & Swell has achieved profitability and an impressive ~$950k in revenue in 2022 and are on pace for  $2.5m in revenue by the end of 2023.

Potential risks:

• 😬Consumer adoption may not match expectations: 

  • 🆚Food and beverage as well as CPG are highly competitive industries - consumers may not differentiate between Sun & Swell’s products and other legacy snack or staple brands.

  • 🫰Consumers may not prioritize or be willing to pay a premium for sustainable packaging. 

• 🔀Producing Sun & Swell’s biodegradable packaging relies on emerging technology, but consumers may gravitate towards other sustainable packaging options including Stash bags or continuing to recycle (even if it’s wishful recycling).

• 🤨The regulatory landscape for biodegradable and compostable materials is dynamic, with evolving standards to meet. Sun & Swell is striving to achieve 100% certified home compostable packaging in the future, although this is not guaranteed. 

Competitors

• Thrive Market: A marketplace offering competitively-priced organic and sustainable groceries and household products to members.

• Whole Foods: An upscale grocery chain emphasizing natural and organic groceries and snacks that caters to health-conscious consumers.

Why Sun & Swell: Sun & Swell are trailblazing in the food and beverage retail industry with their plant-based, biodegradable packaging, making it easier than ever to go plastic-free from your pantry to your purse. With an expanding product line, Sun & Swell has the potential to disrupt the food and beverage retail industry while championing an environmentally conscious future for food packaging. Investing in Sun & Swell is investing in a brand that prioritizes the planet without compromising on convenience, quality, and taste. 🍽📦🌎

Convinced? Invest today in Sun & Swell.