Home Articles Aussie beverage brand H2coco (now H2) is looking to raise $5m equity...

Aussie beverage brand H2coco (now H2) is looking to raise $5m equity crowdfunding on VentureCrowd and launch in the US

0
David Freeman, founder and CEO of H2

Pioneers of coconut water in Australia, H2coco – now known as H2 – is taking the ‘better for you’ lifestyle to new heights, launching its healthy beverage range in the United States. The company will be introducing its products including H2coco Pure Pink Coconut Water and world-first innovations H2melon long life watermelon water and H2nana real banana water to American consumers.

To expand the business and support its US roll-out, H2 is conducting a $5 million fundraise through equity crowdfunding platform VentureCrowd, in addition to private equity. VentureCrowd has secured an exclusive allocation to invest in H2’s capital raise, with the opportunity for investors to gain five times return on investment in three years, alongside prominent Australians including high-profile radio host and H2 investor Kyle Sandilands and industry heavyweight Toby Browne, founder and chair of Pharmacare.

H2 product ranging has been confirmed with a number of major retailers upon launch, as well as more than 10 independent retailers in California and Texas including Gelson’s, H-E-B. and Central Market. H2 has also established an extensive distribution network through distributors including United Natural Foods, Incorporated (UNFI), KeHE Distributors (KeHE), DPI Specialty Foods.

David Freeman, Founder and CEO of H2, said, “VentureCrowd provides a great platform to help us scale the H2 business through new category expansion and entry into new regions including the highly lucrative US market. Crowdfunding is a great way for us to give investors an opportunity to join the H2 ‘better for you’ revolution and share in our success. We have already built a strong brand and customer advocacy, and this fundraise will allow us to scale and execute on our tried and true strategy to take H2 to the next level.”

Steven Maarbani, Founder and Executive Director of VentureCrowd, said, “In this brave new world of equity crowdfunding, consumers can now participate in the growth of a company just like H2, not just buying their products, but by actually investing in the business, significantly accelerating and deepening the most beautifully symbiotic relationship that can exist in economics – the relationship between between a business and its customers.

“When your customers are actually invested in your business, you have created the perfect alignment. It’s a marketer’s dream. And that’s never really been possible before, but it is now. Equity crowdfunding makes it possible for everyday investors to invest in the businesses they love. VentureCrowd’s mission is to make investing in high-growth businesses and property development projects – opportunities once reserved for the super-rich and the highly connected – available to everyone simply and efficiently on your phone in three clicks.”

How has H2 been doing lately?

From a revenue standpoint, H2 has achieved a revenue compound annual growth rate (CAGR) of ~100% from $1.3 million in FY13 to $22 million in FY19 and is conservatively forecast to reach $43 million by 2023 (or CAGR of 60%). H2 has strong distribution partnerships with retail in Australia including leading retailers Coles, Woolworths, Caltex, 7-Eleven, Chemist Warehouse, Boost Juice, IGA and more.

H2 is the number one coconut water brand in petrol and convenience (P&C) with 74% market share and owns the top three selling products in P&C. The brand also has the second largest combined market share in Australian retail and the largest number of retailer distribution points in Australia for coconut water. In addition to major retail partnerships, H2 is expanding into service and HORECA (hotels, restaurants and cafes).

The global packaged coconut water market is forecast to exceed $10.113 billion by 2023, representing a CAGR of 27%. Functional coconut water will lead the market growth. Asia Pacific is likely to have the highest CAGR. Healthy beverage sales have increased by 36% CAGR from 2015-2019 and sales of flavoured coconut water are forecast to exceed one billion litres, growing at a CAGR over 26%. H2 is well placed to capitalise on this forecast growth.

Coinciding with its impending launch into the US market, the company has unveiled its re-brand to H2 – which stands for ‘Health 2 U’ and embodies its core values ‘the real choice’. The re-brand to H2 also represents the evolution of the company, evolving the current portfolio and expanding into new categories to offer greater health and wellness functionalities. The new brand will continue to capitalise on the forecast growth of the coconut water category globally and will also be launching a series of new health and wellness products outside the beverage category under the range extension H2brain&body.

Growing consumer awareness of mental wellbeing and performance (stress, anxiety, brain focus) and the importance of emotional values and ethics in consumer buying behaviour is driving the growth of the health and wellness sector. The new H2 strategy is designed to capitalise on this holistic wellness trend and position the business as the go-to wellness brand for the lucrative health-conscious consumer market.

Get unlimited access to our FREE business tools…

Need to raise capital? Want to become a more persuasive presenter? Want to master social media? Is it time to overhaul your website? Unlock the library to get free access to free cheat sheets and business tools. Click here for free business tools.