Seth Goldman’s Eat the Change raises $14.5M to help launch Just Ice Tea

Dive Brief:

  • Eat the Change, a business co-founded by Honest tea developer Seth Goldman, raised $14.5 million for its Just Ice Tea set to hit the market next month. Collaborative Fund committed $6.5 million and S2G Ventures $3.25 million. The remaining money is coming from a combination of Honest tea stakeholders like co-founder Barry Nalebuff, distributors and suppliers. 
  • The funding is being used to set up and scale production and commit to major purchases of bottles, caps, tea and ingredients. The brand will launch in the Washington, D.C., area in September and nationally in October. 
  • The new launch would come just four months after Coca-Cola announced it would be discontinuing Honest tea later in 2022, leaving a void in the market for an organic, Fair Trade Certified and less-sweet beverage.

Dive Insight:

Just days after the decision was made public to end production of Honest tea, Goldman was already working to launch a new brand to fill the void.

Just Ice Tea will be part of Eat the Change, a two-year-old startup making environmentally friendly, nutrient-dense snacks from carrots, mushrooms and other plant ingredients.

Slowly, new details of the tea brand are trickling out, but many key bits of information have yet to be made public, most notably the flavors and which retailers will carry it. Goldman told Food Dive earlier this year that as Eat the Change developed recipes and formulations for the new brand he expected “some of them will be very similar to what’s already out there from Honest tea.” 

The $14.5 million is higher than any fundraising round for Honest tea, a testament to Goldman’s strong track record of nurturing and providing insight to companies like Honest, Eat the Change and alternative meat company Beyond Meat, where he is chairman.

Goldman’s new tea brand also is entering the market at a much faster speed. While Honest tea grew organically, Just Ice Tea is going national with major retailers in a matter of weeks of its launch, according to a spokesperson.

Once it debuts, the offering will find itself going up against other premium brands in the space also riding the growing demand for tea and better-for-you beverages. These include Coca-Cola’s Gold Peak; PepsiCo and Unilever’s Pure Leaf; and Tazo, acquired last year from Unilever by private-equity firm CVC Capital Partners.

But Goldman has contended the departure of Honest tea leaves a notable void in the marketplace for an organic, Fair Trade Certified and less-sweet beverage, even with these big-name brands commanding a large share of sales in the broader tea category.

Goldman undoubtedly had little trouble raising funding to launch Just Ice Tea given his connections in the industry — but it’s also possible that investors shared his vision that it has a chance to thrive in an otherwise competitive tea category. What’s notable is that he not only attracted investments from firms like S2G, which invests in healthier and sustainable ways to produce food and beverages, but also from partners like distributors and suppliers who will be instrumental in defining Just Ice Tea’s early success.