November 6, 2016

Boston-based Mighty Squirrel, the first maker of a protein enriched beer, has raised $1.8 million of a $2.5 million round from 24 unnamed investors. This round of funding follows on a $2.4 million round raised by the company in 2014.

Already a craft beer producer, Mighty Squirrel was looking for a niche within a niche in order to set itself apart from the wave of craft breweries looking for funding. The team decided to develop a protein infused beer offering four grams of protein per serving – enabling the company to tap into not only the rapidly growing craft brew segment but also the better-for-you segment.

The fresh funding will be used as operating capital but will also be used to support the company’s plans to expand its distribution efforts into New Hampshire and Rhode Island, and to possibly support its future plans for the construction of a brewery.

“Our craft beers have received very positive feedback from the active, social, and health-conscious consumers in the Massachusetts market, and we can’t wait to take our Squirrel to other northeastern states in 2017,” co-founder Naveen Pawar told BostInno. He adds, “We also met with the MassDevelopment team couple of weeks back to explore the possibility of starting a brewery in the Boston Metro area in the near future.”

A Double Whammy

The craft brewing and better-for-you segments are two of the most dynamic segments in the food and beverage industries – offering Mighty Squirrel strong momentum to capitalize on.

Last year the number of craft brewers in the U.S. grew by 15 percent, according to data from the Brewers Association, while the volume produced increased 13 percent and  retail sales grew 16 percent. Craft brewers accounted for 12 percent of the overall brewing market and produced 245 million barrels of beer earning $22.3 billion in 2015.

“For the past decade, craft brewers have charged into the market, seeing double-digit growth for eight of those years,” said Bart Watson, chief economist, Brewers Association. “There are still a lot of opportunities and areas for additional growth. An important focus will remain on quality as small and independent brewers continue to lead the local, full-flavored beer movement.

Meanwhile, consumer demand for value-added, or functional foods and beverages that offer higher protein content also continues to grow, according to the Natural Marketing Institute (NMI) that continues to monitor the protein food and beverage market. In 2014, NMI reports that more than half of consumers purposely sought out high protein foods compared to 39 percent of consumers in 2006, while nearly three-quarters of consumers reported that they consumed high-protein foods or beverages within the last year.

So positioning Mighty Squirrel to capitalize on the growth dynamics being seen in not only one, but two different rapidly growing segments could prove to be attractive to investors and result in rapid scaling up for the company.

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Lynda Kiernan