Brand Holdings / Dr. Emil Nutrition
Brand Holdings was created by Kidd & Company, in partnership with industry executive Jeff Hennion and T-Street Capital, to acquire niche e-commerce consumer brands. The company was funded entirely with equity from the three parties and is actively seeking other brands to acquire.
Thesis
The continued growth of e-commerce has changed the way consumer goods companies must operate if they are to succeed in the future. Many small consumer brands have demonstrated success in one channel – brick & mortar retail, Amazon/marketplace, or direct-to-consumer e-commerce – but few have demonstrated success across all channels. Many native Amazon brands, for example, have 95+% of their revenue through Amazon, which can be risky given Amazon’s penchant for changing the “rules of the game” on an ongoing basis.
We saw an opportunity to acquire brands in both categories that could be grown by a) developing the other channels in which they were not currently strong (including international channels); b) putting in place a robust and repeatable new product development/ introduction process; c) building engagement with the consumer and, as a result, increasing repeat purchase rate; and d) adding sub-brands and associated products targeted to specific customer segments.
We began working on this thesis by focusing on consumer products that are purchased on a regular basis – nutritional supplements, skincare/beauty products, and similar – and have acquired four brands since formation.
Company
Brand Holdings, based in Pittsburgh, acquired its first company, Dr. Emil Nutrition, in June of 2020. It then acquired Simple Botanics and Healthy Skoop, two small brands in the food/supplement space, in early 2021. Most recently, it acquired a substantial equity stake in Knockaround, a sunglasses and lifestyle brand.
Dr. Emil Nutrition has a unique “brand story” focused around Dr. Emil Hodzovic – a medical doctor, nutrition scientist and athlete (former professional bodybuilder). Dr. Emil’s goal is to foster living life to the fullest for “real people,” not just bodybuilders and marathoners. It does so through innovation in health, wellness, and sports nutrition products – products that are doctor-driven and science-backed and designed. Every product is 100% free of hormones, hype, dairy, gluten, GMOs, gimmicks and empty promises.
The company is building out its product line, most recently with product introductions in the immunity, gut health and liver health areas. Simple Botanics added organic bars and botanical teas, while Healthy Skoop added protein powders, greens products and similar.
Knockaround targets the outdoor segment, with sunglasses as its primary product line. Its value proposition focuses on quality, style and value – “quality shades that you can knock around and won’t break the bank.” It was founded in 2005 by Adam Moyer in San Diego during his time as a graduate art student at UCSD.
KCO Value Add
- Identified an industry executive, Jeff Hennion, to work with in the development and execution of the thesis.
- Researched the consumer branded good space in order to develop the thesis and identify the initial platform company, Dr. Emil Nutrition.
- Negotiated and executed the purchase of Dr. Emil Nutrition and the continued involvement of Dr. Emil Hodzovic, the “face” behind the brand.
- Identified, negotiated and executed the purchase of Simple Botanics and Healthy Skoop.
- Identified an appropriate capital structure and investor partner, structuring the investment 100% in equity to facilitate future growth and add-on acquisitions.
- Recruited and hired new management team consisting of a Chief Executive Officer (Jeff Hennion), VP of Product/ Operations, and VP of Marketing.
- Worked with the team to create a detailed 100-Day Plan to guide executional priorities.
- Implemented formal strategic planning and budgeting process.
- Applied enhanced financial reporting and controls, including flash reports, operational dashboards, and audited financial statements.
- Implemented a process for identifying, screening and executing add-on acquisitions that fit with the strategy and have significant growth potential by leveraging the Brand Holdings resources.
