Farmhouse Culture raises $6.5m in financing round led by Gen Mills 301 INC, unveils new sparkling probiotic line

The series D round, which was supported by White Road Investments and Renewal Funds, will help Watsonville-CA-based Farmhouse Culture (founded by chef Kathryn Lukas in 2008) establish itself as "the leading brand in the probiotic-rich category,​" said CEO John Tucker, who took the helm in February 2016.

The new 'Gut Punch' sparkling probiotic beverages, which will hit stores in the spring, are distinct from kombucha (they don't contain tea), but are also quite different to leading sparkling probiotic brand KeVita​​ (which also features Ganeden's high-profile probiotic strain Bacillus coagulans GBI-30, 6086), because they start with Farmhouse Culture's signature fermented vegetable base (water, cabbage, salt, caraway).

Sweetened with erythritol and stevia extract and flavored with beets and fruit flavors, they contain 20 calories per 8oz serving (or 30 cals per 12oz bottle/SRP $3.79) and come in six flavors: cola, cherry cacao, ginger lemon, orange cream, mango guava, and strawberry hibiscus.

“Yes, you could say it’s a risk to spread ourselves across all these different​ categories​ [Farmhouse Culture's portfolio now spans fresh sauerkraut, fermented veg, fermented beverages (‘gut shots’ and the new sparkling probiotic beverages), and sauerkraut-based Kraut Krisps],” Tucker told FoodNavigator-USA.  ​

“But there’s an enormous amount of white space in this burgeoning category and we want to seize the opportunities as soon as we can. ​

“Speed to market is a critical element of my vision for the business because I want Farmhouse Culture to be the brand that consumers see as the leader in the probiotic-rich category. And the beauty of teaming up with General Mills 301 INC is that it gives us access to world class resources, R&D capabilities, and supply chain expertise.”​

Retailers are putting fermented foods in different places in the store

Right now, Farmhouse Culture products are in around 2,500 stores including Sprouts, Whole Foods, Earth Fare, The Fresh Market and Hy Vee, with a strong presence on the west coast. However, the cash injection will help the brand extend into the conventional channel, said Tucker.

“Retailers are all putting fermented foods in different places, so sometimes our kraut will be in a fermented foods section with our gut shots and other products, sometimes it’s in the produce section, sometimes it’s in the deli section and sometimes it’s by refrigerated condiments, and all of these work well for us.​

“The gut shots are also doing tremendously well, and the Kraut Krisps – which contain 50% sauerkraut – were only launched in February but they are definitely picking up traction and we’ll expect to see a broader rollout very soon as many of the snack resets haven’t occurred yet.”  ​

Farmhouse Culture​​ is best known for its organic sauerkraut, which is fresh, refrigerated and non-pasteurized (whereas most sauerkraut sold in grocery stores is pasteurized and shelf-stable).

It is made by shredding cabbage and other veggies, adding salt, and packing them in barrels. After a period of time, the process of lacto-fermentation begins as the veggies start to pickle, creating complex and nuanced flavors, says founder Kathryn Lukas, who argues that “Good kraut should be crunchy, slightly effervescent, and pleasingly sour.”​

It is then packaged in BPA-free pouches featuring ‘ferment-o-vents’ that allow the microorganisms to breathe, and works as a standalone snack or as an addition to salads, dogs, sausages, sandwiches and numerous culinary dishes.

The fresh kraut contains vitamin C and Lactobacillus bacteria that would typically be killed during pasteurization, and is safe to eat as long as it is refrigerated.

Fresh kraut, which is also high in vitamin K, fiber, folate and a good source of zinc and other minerals, also has a superior taste and texture to cooked products, claims Lukas: “Cooked kraut loses its snap and vibrancy when cooked… Raw kraut delivers a crisp, tooth-satisfying crunch that you’ll never you find in a can.”​

“We’ve been watching the functional foods space grow exponentially over the past few years, with Farmhouse Culture emerging as a leader. The recipe for success is there: probiotic-rich products that taste great, led by a team with strong experience in the natural foods industry.” ​

John Haugen, general manager, 301 INC​

Probiotic claims​

While we have been eating fermented foods (beer, yogurt, sourdough bread) for years, products that are actively marketed as such kimchi (pickled vegetables), kombucha (fermented tea), kefir (cultured dairy drink) are still new to many Americans.

However, they have huge potential as consumers seek bolder tasting, ‘ancient-yet-modern’ products associated with digestive health benefits, claimed Tucker, who said that the brand now tends to talk more about ‘probiotic-rich’ foods as “some consumers associate the word ‘fermented’ with sour, spoiled or alcoholic foods.”​

Not all fermented foods are necessarily packed with probiotics (click HERE​​), he acknowledged.

However, Farmhouse Culture is confident that the lactic acid bacteria in its kraut, fermented veggies, and gut shots meet the WHO definition of probiotics (live microorganisms that, when administered in adequate amounts, confer a health benefit on the host), ​although its product labels only refer to the genus and species of the cultures, and not specific strains, with the exception of its Kraut Krisps, which include the well-characterized probiotic BC30 (Bacillus coagulans GBI-30, 6086).

Get a sneak peak at the new sparkling probiotic beverages at booth #5366 at Expo West this week.