The venture capital arm of General Mills has doubled its investment in Good Culture, a higher-protein cottage cheese company, in an effort to help the small business achieve greater visibility.
301 Inc., the packaged food company's business development arm, is one of two lead investors in the Irvine, Calif.-based firm. CAVU Venture Partners and 301 announced their initial investment of $2.1 million in March. Good Culture said Monday the two firms pledged an additional $3 million in financing.
General Mills changed the structure of 301 last fall from an in-house innovation division to one that invests in outside start-up food companies. Since then, it has taken an equity stake in kale-chip maker Rhythm Superfoods, almond-milk based yogurt and cheese company Kite Hill, drinkable and portable gazpacho maker Tio and plant-based protein firm Beyond Meat.
Good Culture makes thick, organic cottage cheese products that are much higher in protein and lower in sugar than traditional cottage cheese. John Haugen, founder and general manager of 301, told the Star Tribune last week that his team likes Good Culture because it offers a single-serve snack option that is simple and nutrient-dense.
"When you think about cottage cheese, a lot of times it's watery and loaded with stabilizers. This is a really clean, high-protein product," Haugen said.
Once 301 recognized the abundance of food start-ups flooding the marketplace and the value of their founders' passion, the company abandoned its in-house attempts at innovating its own new products. Instead, General Mills saw it could help these small, fledging companies scale up, improve efficiencies and ultimately survive. If the small companies achieve great enough success, the Golden Valley-based food maker is then in a strong position to make a potential acquisition.
"I am humbled by how fast our brand has taken off. Good Culture is honored to have such amazing backers to catapult our expansion even more and fund the opportunities we have coming down the pipeline," Jesse Merrill, Good Culture co-founder and chief executive, said in a statement.