Danone leads $10.6M investment in water startup Mitte
- Mitte, a smart home water system, secured $10.6 million in financing led by Danone Manifesto Ventures, an investment fund set up by the French food giant, according to a press release.
- The Berlin-based startup is currently preparing to launch its first product next year: a tabletop system that infuses water with different levels of minerals with custom cartridges. The company, which launched on Kickstarter in 2016, is planning to sell the product in three U.S. cities in 2019.
- Mitte consumers can purchase cartridges from the company, which are projected to last around 250 liters (66 gallons). The prices of the machine and cartridges have not yet been determined, but on Kickstarter, the device was priced as low as $199. The machine also will connect to the internet and allow users to monitor performance with a smartphone app.
Mitte is embracing many of the trends that consumers are looking for today. The German company is advertising its “clean and healthy water” that is free of contaminants and full of minerals, words that resonate with millennials and other consumers more cognizant about what goes into their bodies.
People are increasingly looking for products with clean labels that still offer them taste and benefits. A survey published earlier this year found consumers not only want a kickstart from their energy drinks, but also beverages fortified with vitamins, caffeine and energizing natural ingredients. The minerals in Mitte can offer that, while incorporating them into a popular beverage like water.
Danone, which owns the third biggest water brand in Evian, is acutely aware of the direction of the industry and what consumers are looking for. Last month, Emmanuel Faber, who runs Danone, told The Economist the company has been rethinking its business model and wants to capitalize on more healthy food, which he says will benefit everyone from suppliers to consumers to owners.
More beverage companies are moving into the water space and acquiring drinks that offer healthy alternatives to signature products. Just last month, PepsiCo announced it was purchasing sparkling water maker SodaStream for $3.2 billion as the beverage giant works to minimize its dependence on sugary drinks.
Danone Manifesto Ventures has focused on giving financial capital to innovative, healthy food and beverage companies. Earlier this year, the company announced that it planned to acquire 20 to 25 start-up companies by 2020 with a focus on everything from organic farming to new protein sources.
Mitte is advertising the convenience of tailoring the water exactly to the preference of the consumer in their own home. The startup will allow people to personalize their daily drinking water with different cartridges containing varying levels of natural minerals. With customization and the health benefits, this startup fits into the model that Danone has been shifting to.
Danone can bring marketing and global distribution experience in the water industry to the small company. The Berlin-based startup was founded in June of 2016 with the goal of providing solutions to tap water quality while promoting sustainability by offering an alternative to bottled products. This investment makes sense for Danone because it has already embraced more environmentally friendly practices, like changing its yogurt packaging to bioplastic and working to develop plastic bottles from 100% sustainable sources.
Although bottled water is the top selling beverage in the U.S., according to figures from the International Bottled Water Association and Beverage Marketing Corporation, more products with unique offerings have grown in popularity as people seek the health of water with added benefits and taste. With Danone's experience in the industry, it could help Mitte capitalize on these trends.
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