Better Choice Company (OTCMKTS:BTTR) has closed a Series F financing of $17.8 million, and as part of the financing, the Board and Management funded around $11 million.
Board and Management now owns 50% of Better Choice
Michael Young, the Board Chairman and a major investor in Series F financing, said that they are delighted to reach such an important point for the company’s capital structure. Young said that he has been an active investor in the company for over two years and has grown into a globally multi-channel player.
He added that the secular trends currently witnessed in the pet industry are strong, and he believes that Better Choice is better positioned in DTC, E-Commerce, and Asia to leverage this market opportunity. Young said that following the completion of the financing series, the Board and Management will own around 50% of the company.
Better Choice anticipates its revenue in 2020 to be $45 million, with around $30 million of the sales likely to be generated from e-commerce. This includes product sales to e-commerce retailers like Amazon and Chevy and direct-to-consumer sales through Better Choice’s online marketplace. DTC sales will represent around $13 million of the sales with solid recurring revenue. Online pet product sales have grown from 22% last year industry-wide and will reach over 30% of total sales this year.
Capital from financing to help reduce outstanding term loan
International sales through domestic distribution have continued to grow, which will be around $10 million. Better Choice expects more growth next year of around 50% going by the current quarterly run-rate numbers in the main markets of Japan, Korea, and China.
The company plans to use capital from the financing to reduce its outstanding term loan, which will reduce the cash interest the company pays each month by around $110,000. Enhanced flexibility of the balance sheet will enable the company to invest growth capital into the DTC sales platform as also for international expansion, especially in Asia, as well as pursue possible accretive M&A opportunities.