Sugar-free ice cream brand Nick’s scoops US$30M, while CEO continues “international expansion”

14 Jan 2021 --- Swedish ice cream brand Nick’s has landed US$30 million in funding to expand its production capacity, as well as its global reach with US and Germany at the core of its focus.

“Our key focus is to continue our international expansion with the US being our highest priority. We are also continuing our geographical expansion in Europe,” Stefan Lagerqvist, Nick’s CEO, tells FoodIngredientsFirst.

“We will use part of the funds to set up a new factory in Europe as we have almost outgrown our current factory.”

“As consumers spend more time in their homes a lot of the consumption follows. We can therefore see that the ice cream category is growing at retailers, but even more so online with consumer behaviors shifting toward online shopping,” Lagerqvist adds.

Stefan Lagerqvist, Nick’s CEOThe funding round was led by Stockholm-based investment group Gullspång. Khosla Ventures, DNS capital, Djursholm Investment Group, Skandrenting AB, PeakBridge are also among the investors.

Sweet but healthy
Diseases linked to diet, like diabetes, are a significant international problem and the trend is all but sweet, the company says. 

Nick’s offers healthier ice cream alternatives with no added sugar, gluten, palm oil and at a lower calorie count. 

The most recent innovation is the ice cream that contains 70 percent less calories than other leading brands. In the US, Nick’s has the exclusive right to use EPG, a patented fat replacer which gives the ice cream great taste and texture despite being low-calorie. 

Previously, FoodIngredientsFirst caught up with Nick’s and discussed how the low-calorie ice cream segment is changing.

Furthermore, Nick’s launched a vegan ice cream in collaboration with Perfect Day, who invented the world’s first animal-free whey protein that’s identical to protein in cow’s milk but without any cows involved in the process. 

“Our latest launch of low-calorie ice cream, without added sugar, during the spring has been very successful and we are now leading the better for you ice cream segment. Our ambition is to replicate the success outside of Sweden and that’s why we raise capital – to fuel our global growth,” Lagerqvist details.

On the expansion track
The company was introduced in the US by the end of 2019 and during the second year the company had already a turnover of approximately US$10 million.

Part of the funds will be used to set up a new factory in Europe as the company has outgrown its current plant.The food business is undergoing a large paradigm shift where healthier foods will transform the entire category of foods, Lagerqvist notes.

“We see that the drinks and ice cream segments have already come a long way in this regard, and today you can find healthier alternatives without making any compromise on flavor.”

“When we producers can create functional products and with enough flavor, other categories within food will follow. Healthier food is a catalysator for a more sustainable future and will have a huge impact on a global scale,” he notes. 

When it comes to trending ice cream flavors Lagerqvist says that flavors are “generally very local, hence they differ in different markets.”

“What we can see in general is that better-for-you and better-for-the-planet concepts are growing faster than the general ice cream market.”

The company’s core strength as a food tech company is its high pace of innovation, he notes. 

“We will continue launching new concepts leveraging the latest food science on the ingredient side,” Lagerqvist concludes.

By Kristiana Lalou