Beyoncé participates in Lemon Perfect’s $31M funding round

Dive Brief:

• Lemon water brand Lemon Perfect closed its $31 million Series A funding round. Investors included celebrity Beyoncé Knowles-Carter and consumer product funds Beechwood Capital, Goat Rodeo Capital, Melitas Ventures, NNS Capital and Trousdale Ventures.
• The company plans to use the funds to more than double its distribution to upwards of 40,000 points by the end of the year. Lemon Perfect predicts greater than 100% revenue growth in 2022, and the brand says it quadrupled revenue in 2021.
• Enhanced water beverages are getting to be more popular as consumers search for healthier, clean-label options for hydration that go beyond their taps. Lemon Perfect has capitalized on the trend, raising $42.2 million to date and notching a valuation of more than $100 million in less than three years.

Dive Insight:

Since its founding in 2017, Lemon Perfect has been the beneficiary of several big trends in food. The brand, which claims to have the juice of half of an organic lemon — and 100% of the daily value of vitamin C — in each bottle, bills itself as a hydrating, flavorful and natural option for consumers on the go. There is no sugar in Lemon Perfect — it is sweetened with erythritol and stevia — and its website highlights several of the health benefits found in lemon juice. Lemon Perfect strengthens the immune system, provides energy without caffeine and adds digestive benefits, according to the company.

With this newest investment round, Lemon Perfect is setting itself up for the next level. The $31 million funding round is more quadruple the $6.6 million the brand had raised in 2020.

And the star of the funding round, entertainment icon Knowles-Carter, also brings it to new heights. Knowles-Carter, well known around the world as a singer, actress, record producer, fashion designer and businesswoman, has not made many investments in businesses. According to Crunchbase, Knowles-Carter has invested in three other companies since 2015: concert merchandise app Sidestep in 2015, sustainable juice brand Wtrmln Wtr in 2016 and fashion company Destree earlier this month.

While one of Knowles-Carter’s most acclaimed albums is called “Lemonade,” a written statement from Lemon Perfect indicates the correlation of names is not the only reason she invested in this brand.

“I don’t typically enjoy drinks without added sugar, but Lemon Perfect is delicious,” Knowles-Carter said in the statement. “It was an easy decision to invest in something that not only tastes great and is healthy, but also, and most importantly, allows choosing a healthier lifestyle to be affordable and accessible to everyone.”

While Knowles-Carter is one of the world’s best-known celebrities, the cachet that her backing will bring to Lemon Perfect is unknown. In the years since she’s invested in Wtrmln Wtr, she’s talked the brand up on social media and her own website, but hasn’t done any marketing campaigns. However, many have linked her investment in the upcycled juice brand to a tacit endorsement, and fans have consumed the juices simply out of deference to her.

Considering the brand’s recent performance, Lemon Perfect may not necessarily need someone with Knowles-Carter’s status to grow, but it could help. Celebrity investing has been a trend among CPGs in recent years, and it’s largely been beneficial to all parties. Consumers see that a celebrity believes in a brand enough to put their own money into it, which runs deeper than a simple endorsement deal. And celebrities also are able to profit from their investments — which can especially be beneficial if the celebrity’s involvement with the brand leads to more sales.

Knowles-Carter is the biggest celebrity to back Lemon Perfect, but she’s not the only one. Lemon Perfect’s 2020 seed round had participation from several athletes, including basketball’s Channing Frye, Nick “Swaggy P” Young, Spencer Dinwiddie, Blake Griffin, Josh Hart, Damian Jones, Kyle Kuzma, Meyers Leonard and De’Anthony Melton. The release about Lemon Perfect’s current funding round mentions participation of a network of investors from “media, music, sports, and entertainment,” but Knowles-Carter is the only one the company mentioned by name.