HOW BACKING FROM GENERAL MILLS IS HELPING PETPLATE SCALE
This subscription-based service leverages its lean-and-agile concept to scale next-level growth with backing from General Mills’ 301 INC investment incubator.
The trend toward treating pets as members of the family has spawned a tidal wave of healthy pet food products, and PetPlate has been riding at the peak of the surge.
The New York City-based pet food brand has carved out a premium niche in the space with its fresh-cooked, human-grade dog food products that it offers frozen via an online subscription service.
In addition to its focus on health, PetPlate also offers a degree of customization that helps it stand out from competitors, said Renaldo Webb, who founded the company in 2016 after first cooking food at home for his own dog.
“If your dog is a chihuahua, you get a very different plan than if you have a Great Dane,” he said. What’s more, “it allows us to address the pet obesity epidemic, and make sure people are not overfeeding or underfeeding their pets, and it allows personalization. All of that is powered by the fact that people order online and have it delivered to their door.”
Customers sign up on the PetPlate website and fill out a profile of their dog, and the company creates a customized meal plan. Meals come in four flavors, which customers can select from based on their dog’s preferences: Barkin’ Beef, Tail Waggin’ Turkey, Chompin’ Chicken or Lip-Lickin’ Lamb.
PetPlate, which outsources manufacturing and logistics, ships three weeks’ worth of preportioned meals at a time, and customers can also add PetPlate’s organic dog treats to the mix.
There’s limited bandwidth on our end, so for us to be able to rely on a partner with the institutional knowledge of General Mills has been very beneficial.
The benefits of backing, ‘institutional knowledge’ from General Mills
PetPlate has been growing 100% or more each year, Webb said, and has delivered more than 15 million meals since launch. It secured early financial support from Canadian investment firm BrandProject and other independent investors, and earlier this year it received a major boost with a $9 million Series A investment led by DFE Capital Management and 301 INC, the General Mills-backed incubator for entrepreneurial food brands.
“The pet food category is one of the largest food categories in the U.S, and it’s still growing,” John Haugen, managing director of 301 INC, told CO—. “Pet owners are driving the humanization and premiumization trends as they look for the same quality meals to feed their pets as they want for themselves, which is why we believe in the customer-centric approach that PetPlate has taken.”
As part of its funding from 301 INC, PetPlate also benefits from General Mills’ vast expertise in the food industry.
“They help with everything from marketing-related opportunities to procurement and sourcing to manufacturing,” said Webb, adding that General Mills’ experts have provided “a good sounding board.”
PetPlate has been growing fast and operating with a lean team of about 15 employees.
“There’s limited bandwidth on our end, so for us to be able to rely on a partner with the institutional knowledge of General Mills has been very beneficial,” said Webb.
General Mills seeks to nurture brands that share its mission of feeding families, he explained, and pets have become important family members in more and more households.
“The ‘pets-as-family’ mentality has risen to a whole new level in the last 10 years,” said David Lummis, pet market analyst at research firm Packaged Facts.
He said the premiumization of the pet-food category has enjoyed strong momentum and can be expected to survive the pandemic, even if a sluggish economy pressures household spending.
“I expect consumers are going to continue to buy the best products they can afford, particularly health-oriented formulas,” said Lummis.
Pet business booms amid pandemic
The pandemic has been a boon for online pet food offerings, according to Packaged Facts research. The firm estimates that pet food sales overall will increase 7% in 2020, to about $39.2 billion, and that 27% of those sales will occur online, compared with 22% in 2019.
Lummis noted in a recent report that subscription- and loyalty-program-based pet products and services, including auto-replenishment, have become much more common in the industry. He cited Chewy’s Autoship program, Amazon Prime’s Subscribe & Save, and The Farmer’s Dog, another fresh pet food startup, as examples. In addition, several companies offer customizable subscription boxes of pet supplies, including Petco’s PupBox, which targets puppy owners; BarkBox, which offers a monthly subscription box featuring all-natural treats and toys; and pupjoy, which has been offering “quarantine boxes” for consumers to optimize the time spent at home alongside their pets during the pandemic.
A need for better dog food
Webb initially saw the opportunity for a business based on human-grade dog food when he was working as a consultant for major pet-food companies. He launched PetPlate based on his confidence that he could make a better dog food than what most people were currently buying.
He took the concept to Shark Tank, where he failed to get backing from the reality TV show’s panel of investors, but PetPlate likely benefited from the exposure the show provided: The company is one of the few businesses that did not receive an investment but was featured in a follow-up segment on the show.
From the beginning, when Webb was cooking and delivering his products himself, he used the feedback he received from customers to improve the business. Since then, he’s been monitoring feedback on an ongoing basis to continually improve and retain his customers — which is often the biggest challenge subscription-based companies face.
“We focus on making sure we understand the needs of our customers, and focus on why customers are canceling,” said Webb. “If we notice there’s a meal our dogs aren’t liking, we make sure we talk with our R&D [research and development] team. We look at the pain points and try to resolve them.”
Often those pain points are related to the cost, he said. To encourage trial, the company has offered a percent-off discount for the first order, and other strategies that help customers reduce their bill, such as its Toppers program offering smaller portions that can be mixed in with other dog foods.
PetPlate also recently revamped its website and branding efforts around its new tag line, “It’s about time.” The phrase is meant to have multiple meanings, including the concept that pet owners can spend more quality time at home with their dogs if they are having their food delivered. The “about time” phrase is also used to highlight the time PetPlate spends sourcing whole food products, for example, and the time its staff veterinarian spends crafting recipes.
For his next act, Webb is eyeing a more traditional e-commerce model for some products, such as its organic treats. Human-grade cat food — a frequent request the company receives from consumers — could also be on the horizon, Webb said.
“We hope next year to start really experimenting and testing with e-commerce,” said Webb. “We are really very data-centric, so we will test and make sure we have the right user experience and do that properly.”