- VO/D, a startup that helps fund and operate celebrity ventures, raised $5 million in new funding.
- Its first brand, 1UP Candy, has grown to $10 million in yearly revenue and is in over 12,000 US stores.
- VO/D's CEO said the company plans to use the raise to invest in more verticals.
Too many celebrities are launching products that consumers don't really need — or want.
That's the general thesis that motivated CEO Chris Koch to found VO/D, which helps fund and operate celebrity-led ventures. With VO/D, Koch and his team wanted to flip the script: first build a product that can succeed on its own, then bring in celebrities or creators to help it reach the right audience.
"I think that was a big shift for the business that helped us differentiate as a studio model," Koch told Business Insider. He said the goal is to have talent serve as an "amplification tool" rather than the only thing drawing a consumer in.
VO/D started with freeze-dried candy before moving into the protein and supplements category, with new products to come next year. Koch said the company is looking to expand into more verticals. To that end, the company announced on Thursday a $5 million Series A funding round led by KarpReilly, a private-equity firm that has invested in brands like Koia, Salt and Straw ice cream, and Sprinkles cupcakes. Other investors included NFL players Saquon Barkley and Odell Beckham Jr.
"They really liked the portfolio approach of our studio," Koch said of the investors. "So being able to have exposure across multiple brands, and the success that we were having on our first portfolio brand, 1UP, was interesting to them, because they typically invest directly into individual brands."
How VO/D found success in the candy market
VO/D launched in 2021 and received $2 million in financial backing in 2022 from a friends and family round. Investors in that round included the Tisch family, owners of the New York Giants. With that funding, VO/D invested in the candy industry, combining freeze-dried candy brand 1UP Candy with gaming YouTuber FaZe Rug.
"That was based on a consumer insight that we identified in novelty, experiential candy," Koch said. "You see it with Mountain Dew or Oreo in terms of innovation and collaborations, but you don't really see much of it in the candy aisle. And so we wanted to create new and interesting flavors and textures."
1UP Candy is in over 12,000 retailers across the US, and has grown revenue to over $10 million on a trailing 12-month basis.
VO/D's next three products will be Frosh, a protein-juice brand for kids; Joose, a fruity protein supplement; and Stealth, protein snacks for kids. VO/D hasn't yet announced the celebrities who are attached to those brands.
Read a version of the 12-page pitch deck that VO/D used during its $5 million round.
VO/D's deck opens with its logo.
VO/D added that it had been backed by CPG PE Firm, KarpReilly, as it sought new investors.
KarpReilly has also invested in Spindrift, KeVita, Koia, and Sprinkles Cupcakes.
VO/D believes that the future of consumer brands will be owned and led by celebrities.
VO/D lists some of these celebrities, including Logan Paul. His brand Prime had $1.2 billion in revenue in 2023, though it has more recently faced struggles.
VO/D has developed its own approach to launching talent-led brands.
On the left, the slide has three categories: criteria, investment, and team. The left column, with white font, illustrates how VO/D tested these three areas, and on the right, in green, is the scale the company sees it growing to.
VO/D's process includes three steps. The first is 'identify.'
The slide says:
- Identify category, insights, and innovation for a profitable consumer business.
- Approach talent directly and initiate discussions.
- Use proprietary tools to analyze talent, audience and market fit.
The last point includes criteria for how VO/D analyzes the talent. Some of the tools it uses include lifestyle interviews, reach breakdown, trending posts, and sentiment analysis.
The next step in the process is 'validate.'
VO/D has a "rigorous pre-launch process" that helps make sure the talent is fully engaged.
These steps include reviewing opportunities, negotiating market commitment, concept and creatives testing, and market testing.
The third step in the process is 'launch.'
The slide says, "Our trusted partner network ensures top-quality execution of the product vision."
VO/D provides a case study of one of its brands: 1UP Candy.
It highlights six things: consumer insight, talent fit, a launch partner, quick profitability, massive results, and major retail distribution.
VO/D outlines a 'growth hack' through its 'storefront' FRI&NDS.
FRI&NDS is a live events platform that launched during the Super Bowl in New Orleans this year, hosting Odell Beckham Jr.'s party.
The final slide is for thanks and getting in touch with VO/D.
