David's $75M Raise and Acquisition Play

If your brand uses EPG, I wanna hear from you!

In an article that has now been taken down by NOSH, it was announced that David, the brand behind the infamous protein bar, has closed a $75M Series A, led by GreenOaks and Valor Equity Partners as well as acquired their ingredient supplier, Epogee, news that apparently will break officially on Thursday (if not sooner). As someone who is deeply against CPG brands raising like tech, I’m just glad that this raise is going towards scooping up an ingredient company like Epogee that currently services various brands across categories, the most notorious one being Nick’s (ice cream and protein bars)—as we enter a GLP1 and biohacking protein craze, David’s betting on EPG going forward and it will leverage it to their advantage.

What is EPG you ask? Let’s rewind back to 2011, EPG or the artist otherwise known as esterified propoxylated glycerol is made and patented by Epogee, a new kind of fat that would reduce calories from fat by 92%, by allowing fat to pass through the body without being fully absorbed and reducing caloric intake. EPG’s abillity to stay true to traditional feel and flavor of fats has made it incredibly popular in categories like ice cream, according to Epogee, Nick’s success can be attributed to the use of EPG, its popularity also stems from it being considered GRAS (generally recognized as safe) by the FDA across more than 10 food categories, and considered GMO, gluten and allergen free, vegan as well as Kosher. EPG’s usually compared to Olestra, though they claim that it has no side effects and considered a lot more safer than the former, Olestra caused a scandal throughout the 90s because it made people shit themselves, though apparently in large quantities EPG can have similar effects?

Epogee has raised a total of $10M, pennies in comparison to what some less innovative CPG brands have raised in 2020s (cough, cough canned water) but based on their on their clientele, see Nick’s $100M raise and expansion into snacking aisle, starting with protein bar (though their bars do not list EPG as an ingredient) leads me to believe that this has been an incredibly lucrative customer for Epogee. The question then becomes—is David merely buying Epogee as way to consolidate and vertically integrate (see Hormbles Chormbles, the latest brand extension featuring protein chocolate) or is it a way to assert control over the competition, it would clearly be a way to add a new revenue stream by licensing the ingredient and having a say whether or not it interferes with their own plans around their product platform.

Should brands using EPG be concerned? McKay Fugal, founder of Defiant Chocolate, a chocolate protein bar, sources from Epogee, told Snaxshot—

"I am concerned what this aquisition means for our company Defiant Chocoalte which uses EPG as a key ingredient."

Hormbles Chormbles officially launched this year as a competitor to a brand like Defiant.

Are you a brand that uses EPG? I want to hear from you.