Kiwi drinks firm seeks investors to satisfy thirsty US market
26 November 2015, 1:44PM
SOS Hydration Inc., a majority Kiwi-owned, United States-based drinks firm which was awarded the United States’ best new retail product last year, is looking for experienced local investors to come on board in a unique equity crowdfunding offer.
In a first for New Zealand’s emerging equity crowdfunding market, the offer is pitched at experienced investors only, offering convertible notes which will convert to ordinary shares in 2016.
SOS co-founder and Chief Marketing Officer Tom Mayo says the firm’s healthy rehydration products have created big waves in the huge United States beverage market, and it is now seeking capital to help drive an exciting period of high growth.
“The US sports nutrition market, worth US$5.9 billion and forecast to grow to US$6.5 billion in 2017, is our single biggest opportunity, which is why we’ve registered and based our company there.
“With SOS Rehydrate we’re creating a new ‘healthy rehydration’ category. SOS Rehydrate features a world-class formula comparable to an intravenous drip in combating dehydration. It’s low in sugar, high in electrolytes, contains no artificial additives or preservatives and is scientifically proven to rehydrate three times faster than water,” says Mayo.
Last year the firm won the Best New Product award at ECRM, a major retail trade show in the US. This year, just its second full year of business, SOS has so far sold over 800,000 servings through its sales partners, who include several key mass market retailers in a number of US States.
The company has also been taken under the wing of Coca-Cola as part of the drinks giant’s Venture and Emerging Brands Founders Forum, an exclusive incubator for just ten entrepreneurial drinks brands from around the world.
SOS’s list of high profile ambassadors include Indycar driver Scott Dixon, newly-crowned World Sailors of the Year Peter Burling and Blair Tuke, America’s Cup skipper Sir Ben Ainslie and Olympic gold medallist and multisport legend Hamish Carter. Dixon, Burling and Tuke were early investors in the company.
SOS Rehydrate is also stocked in Sir Richard Branson’s exclusive Caribbean resorts at Necker and Moskito Islands.
Head of Deal Flow at Snowball Effect Shaun Edlin says the offer for SOS Hydration is a new and exciting innovation for equity crowdfunding in New Zealand.
“This is the first offer exclusively for wholesale investors to be made public on our platform, so it’s an exciting opportunity for Snowball Effect to be bringing to market.”
The offer to experienced Kiwi investors is part of a wider capital raising round being undertaken globally by SOS. More than US$805,000 has already been raised, and Kiwis will receive the same terms as other investors, who include a member of the well-known Hennessy drinks family.
The maximum funding cap for the New Zealand equity crowdfunding campaign is US$1.5 million (NZ$2.3 million) and the minimum investment amount is NZ$10,000. The offer is for convertible notes which convert to equity at the next qualified financing round, expected to be a ‘Series A’ round during 2016.
The current round is offered at a 20 per cent discount off the Series A valuation in 2016. The value of the company in the current round is capped, so the value of the company for these investors will not be greater than US$10 million.
The offer for SOS Hydrate is hosted on the Snowball Effect website snowballeffect.co.nz, and closes on 18th December 2015.