Cape Town-based PURA Beverage Company raised Series A from South Africa’s one of the most active Venture Capital firm Knife Capital. The deal size, like any other Knife’s investment, remains undisclosed.
PURA was founded in 2015 to address some of the macro trends in the beverage industry that include sugar taxes levied on manufacturers, increasing consumer interest in health and wellbeing and greater consideration to flavours. The funding will be applied to boost marketing initiatives, build team capacity, develop new products and provide working capital to ensure that PURA keeps up with demand.
“Consumers still want taste and refreshment but without the expense and artificial sweeteners. PURA is a low-sugar beverage – it only has five ingredients and contains less than a third of the sugar of most soft drinks available in the market – making the soft drink affordable as it falls below the sugar tax threshold,” says Greig Jansen, CEO and Founder of PURA.
The beverage company was funded by the founding team who are former AB InBev, SABMiller, Coca-Cola, Mars and Red Bull executives, and angel investors with beverage industry expertise.
After extensive consumer trials and testing, PURA launched in the South African market in the first quarter of 2017 and has also started to export to select international markets, with a view to going global.
Jansen says that PURA followed a very different model from a typical startup. “We have an unwavering belief that anything is possible, so we first built a highly experienced team and ensured a product-market fit before raising funding for growth. We had a number of funding options in the end, but during due diligence found a good fit with Knife Capital and their investment philosophy of adding value by bringing knowledge and networks to the partnership in addition to funding.”
PURA is the fifth investment from Knife Capital’s Section 12J Venture Capital Fund – KNF Ventures – and first for this year. This is also a visible diversification in Knife’s investment portfolio, which is traditionally a tech-focused VC.
Andrea Bӧhmert, Co-Managing Partner at Knife, explains, “We invest in scalable innovation-driven ventures with proven traction, backed by a management team that can execute an ambitious growth plan. We believe that it also reflects the spirit of Section 12J investment in local SMEs that innovate to create and maintain jobs while growing the economy and broadening the South African tax base.”
Bӧhmert adds that there are potential synergies with follow-on investment partners and opportunities for PURA from the private equity side of Knife Capital’s business, where there is already some exposure to food processing and manufacturing businesses. Knife Capital invests via a consortium of funding partnerships, including SARS section 12J Venture Capital Company KNF Ventures and select family offices.