Fast-growing “better for you” snack brand disrupting a c.$80bn sector
- Type: Retail
Chief is a fast growing brand in the “better for you” snacking space with national and international distribution. They have doubled revenue in the past 12 months and over the past 3 months have achieved a $4m annual revenue run rate and profitability on a normalised basis.
Within the c.$98bn global healthy snack market, consumers are moving away from big food companies with their perceived healthy snacks which are actually full of artificial ingredients and/or sugar. Consumers are instead looking towards alternative, “purpose led” brands which use genuinely healthy and sustainable ingredients.
Overview of Chief
Chief has created a range of health snacks and supplements that are uncompromising on health and sustainability. Chief’s beef bars and collagen bars are made using secret recipes which are very difficult to replicate:
- Chief Beef Range (54% of current revenue): Unique, organic, grass-fed beef bars and biltong using premium cuts of organic grass-fed Aussie beef, farmed with regenerative practices. No nasty preservatives or additives. Currently ranged in most Ampol stores and soon to be ranged in Woolworths.
- Chief Collagen Range (37% of current revenue): Sweet, nut-based bars, with collagen protein, that are one of the only truly clean and healthy snack bars in the world. All natural and low sugar. Currently ranged in Woolworths.
- Supplements (10% of current revenue): Our new range of supplements are sourced from real food rather than being made in a lab which gives superior bioavailability.
Chief is already gaining significant traction, tracking run rate revenue of over $4m, with ranging in Ampol, BCF, Dan Murphy’s, Harris Farm and Woolworths. Through direct-to-consumer online channels, Chief creates strong customer loyalty and community building.
Brock Hatton and Justin Babet launched Chief in 2015, alongside Libby Babet (health expert, author and former trainer on Channel 10’s “The Biggest Loser”) and Veronika Larisova (nutritionist and exercise physiologist).
Libby, Brock and Justin are experienced founders with 5 successful exits between them. Brock was also one of the founding team for international health food brand Nuzest (still operating).
They are advised by a network of prominent figures across finance, investing and FMCG brand building.
Looking forward, Chief will use this round of capital to further accelerate its rapid domestic growth through deeper support of major retailers and distributors (for example, funding trade marketing and promotions), expanding its product range and further growth of online revenue driven by expansion of its extensive ambassador network.
Chief has many international opportunities and already exports to New Zealand, Middle East, Singapore and Hong Kong. Chief also has existing direct-to-consumer revenue from the US and other international markets.
- Impressive traction to date
Chief's annual revenue run rate has grown 2.5x since the last capital raise from $1.6m to over $4m. Close to 25% of online revenue is from subscription customers who receive an automatic order every month. The company achieved profitability on a normalised basis and are forecasting profitability this financial year, while still continuing to invest in rapid growth.
- Multi-channel distribution
Our annual revenue run rate has grown 2.5x since the last capital raise from $1.6m to over $4m. Close to 25% of online revenue is from subscription customers who receive an automatic order every month. We have achieved profitability on a normalised basis and are forecasting profitability this financial year, while still continuing to invest in rapid growth.
- Strong exits in the space
Large food companies are buying smaller brands to maintain market share. Recent US examples include General Mills / Epic Meat Bars (acquired for $100m, 5.0x revenue) and Kelloggs/ RX Bar (acquired for $600m, 5.0x revenue). This trend has also been seen in Australia with Well Naturally, Keep it Cleaner and Raise the Bar all acquired recently.
- Differentiated product range
We’ve developed a range of healthy snacks that are some of the only snacks nutritionists, dieticians and doctors tell us they recommend to their customers. Our bars use secret recipes (trade secrets) that are very hard to replicate
- Highly marketable brand with excellent customer feedback
Our brand has tremendous reach online, with over 4m Australians seeing our advertisements over the last 12 months. We have industry-leading metrics such as a CAC (Cost to Acquire a Customer) to LTV (Gross Margin Lifetime Value) ratio of 3. Additionally, close to 40% of our online revenue comes from email marketing. We have excellent customer feedback and a high repeat purchase rate of 35%.
- “Better for you” is booming
The “Better for you” snack market is projected to grow at 6% over the next five years as consumers distrust big brands and are increasingly seeking “purpose led”, healthy alternatives.
- Robust growth strategy
We’ve established a robust growth strategy to drive towards our target of over $20m revenues by FY2026. Our plan includes growing our product range and distribution channels, with plans for international expansion through an online-led strategy in the US.
- Rapidly improving margins
We’ve recently achieved significant cost savings across our supply chain which is resulting in large bottom-line gains over the coming 6 months.