Investors are betting consumers will finally take their vitamins.
At $65 a month, Venice-based GEM sells melatonin-free daily sleep supplements made with ingredients like magnesium, rosemary, pumpkin seeds and valerian root.
It's neither a pill nor gummy vitamin but, as founder and CEO Sara Cullen calls it, real food.
"I would think of a protein bar you might know," Cullen said. "It has a nice dark chocolate profile. Nice seeds so it's got a beautiful texture and chewy in that kind of way."
The early-stage consumer fund that backed beauty vitamin brand HUM and the "hydration multiplier" Liquid IV is now behind a $10.5 million seed round for Cullen's L.A. startup selling supplements that will "improve whole body health at a cellular level."
Founded in 2018, GEM is tackling the $140.3-billion supplement market with its line of daily "whole food bites" with names like Sleep, Immunity and Daily Essentials.
"It's a reinvented multivitamin," the CEO said.
A few years ago, after learning she was deficient in a long list of nutrients, Cullen stood in the vitamin aisle of a store and studied almost every bottle on the shelf.
"They were filled with a lot of isolated vitamins, filled with synthetic and artificial fillers, sugary binders," she said. "It didn't intuitively seem right. Like why am I eating a candy for my health?"
Her solution was a California-made supplement that looks more like a small, organic brownie than a vitamin. And she defends the price by claiming that it would cost consumers far more to source these ingredients themselves.
"If you were to go individually buy all those ingredients, it would cost you upwards of $200," she said of GEM's $39-per-month Daily Essential vitamin — made with mushrooms for Vitamin D, chickpeas for bone protection and ashwagandha to fight stress. For reference, a Target 300-count women's daily vitamin is stocked online for $12.59.
The startup says it has sold over 8 million squares since going to market in 2019 online and in Erewhon locations in L.A. And it watched a near 400% spike in sales its second year.
With its first round of capital, GEM joins L.A.'s hub of venture-backed startups selling dietary supplements. In April, Venice-based Seed closed a $40 million Series A round for its daily probiotic that runs consumers $49.99 for a month's supply. The L.A. brand Ritual raised $25 million in 2019 for its $30 per month vitamin service.
Cullen said she'll use the capital to double the team, expand into retail and plan for new products.
The round was led by Pat Robinson of CircleUp Growth Partners with participation from investors, S2G and Pentland Ventures.
Los Angeles startup PeaTos brands its products as an alternative to "junk food" like Cheetos and it just nabbed a former executive from competitor Frito-Lay, maker of the neon orange puffy chip.
David Johnson, a 19-year veteran of Pepsico's Frito-Lay brand, was named chief growth officer of the Westchester-based brand.
As the startup's first CGO, Johnson will focus on driving retail sales and developing a greater presence in foodservice. The appointment comes after Peatos raised $12.5 million in February from Post Holdings, Inc., known for its hand in building out cereal brands like Honey Bunches of Oats. That came just four months after the company raised a $7 million Series A round.
The snack food brand, which is sold online and at retail outlets, has also picked up a steady stream of online subscribers for its fiber and protein-dense chips. In February, PeaTos CEO Nick Desai told dot.LA that the company grew 50% from 2019 to 2020 and expects 100% growth this year.
The flavored crunchy curls and rings are sold in 4,700 retailers including Vons, Albertsons Safeway, Sprouts and Kroger.
"It will be my pleasure to help ensure that all consumers have a choice of PeaTos while shopping their favorite retailers," Johnson said in a statement.
Johnson most recently served as chief executive of beeline North America, a fashion accessory supplier. His last post at Pepsico was as an executive on the Stacy's Pita Chips team.
The focus on mental health and wellness has become increasingly more prevalent in recent years. But not only can it be extremely difficult to find the right resources as a patient and a provider, there still exists stigma around the act of seeking help. Mental wellness network Frame seeks to fix that, and not a moment too soon during the pandemic.
In this installment of dot.LA Dives In, we talk with Kendall Bird and Sage Grazer, the co-founders of Frame, a mental wellness network that seeks to help people find a form of therapy and a therapist.
When Kendall moved to New York City after college, she found herself struggling to adjust to her new life. Identifying a therapist to help her work through those issues was not an easy task, but when she found the right person, she realized how powerful that relationship was.
When she returned to her hometown of Los Angeles, she found herself again struggling to find a therapist. She reached out to her childhood friend Sage Grazer, a therapist herself. Sage was grappling with her own set of challenges trying to run her own practice without any business training.
"I was sharing with Kendall how difficult, as a new therapist, it is to get clients, and she was sharing with me how hard it was for her to find a new therapist. And this was something that me and my colleagues were all experiencing, so Kendall proposed that we build our own platform," says Grazer.
Having started a company before, Bird emphasizes how critical it was to find the right founder fit.
"It was important for me to partner with someone that had a very different perspective, and was also an expert in the field in her own sense," says Bird. "We thought about all the other services that were out there and identified what we felt like was missing. And so we built this unique experience which is now Frame."
What started as an app to connect users with therapists has evolved into a platform to match potential clients with therapists, a "business in a box" to help therapists grow their practices, and as 30-45 minute digital discussions run by licensed therapists that introduce potential patients to the basics of therapy and help dispel the stigma around mental health and wellness.
"What we're trying to do with the discussions is really show you concrete examples of how therapy can be applied in different scenarios," says Bird. "The more we tell those stories, the more people will hear them, and understand how (therapy) is relevant in their specific life and situation."
As remote care becomes more common during the pandemic, Frame has leveraged its toolbox to help clients adapt by making it easier to connect virtually. Not only are they providing training for therapists that have been forced to run their practices remote, but the digital discussions have provided a path for the founders to give back to the community.
"Our digital discussions have been a real gift as a part of Frame to be able to give during this time when people are in lockdown," says Grazer. "Maybe they can't get to a therapist, maybe they can't afford a therapist because they lost their job. So we are able to offer these free workshops and give people actionable tools that they can start putting into play immediately."
While you might think launching a startup during a pandemic would be tough, the co-founders credit Los Angeles as setting them up for success. With how spread out the city is, Frame was already built to be Telehealth-oriented before COVID hit.
"Starting in L.A. really set us up for success when this whole pandemic happened, because we were already built to sustain Telehealth and people being able to work remote," says Bird.
Watch the full interview to learn more - in this conversation, we dive deep into Frame's history, talk about their experiences during the pandemic, and discuss what companies can do to create a more inclusive environment when it comes to mental wellness.
dot.LA Dives In: Frame Co-Founders Discuss How They Built the Mental Wellness Network www.youtube.com
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Kelly O'Grady runs video and serves as the chief host & correspondent for dot.LA. Find her on Instagram @kfogrady and email her at kelly@dot.LA.
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