A Tempe-based startup that makes packaged oats has landed a new round of funding, allowing the company to expand retail sales and build out a new fulfillment center in the Valley.
Oats Overnight announced that it recently raised $20 million in a series A round of funding. Investors included Singh Capital Partners, BFG Partners, Impatient Ventures, Watchfire Ventures, Morrison Seger Venture Capital Partners and Vanterra Ventures, among others.
"We will use this capital to significantly expand into the retail channel and continue to evolve our community-led product development process,” Brian Tate, founder and CEO of Oats Overnight, said in a statement.
A portion of funding is going toward building out a new, 85,000-square-foot production and fulfillment center in the Valley, Oats Overnight said in a release.
Oats Overnight, which indicates its gross revenue run rate is more than $100 million, will also use the infusion of capital to expand its sales team, beginning with hiring a vice president of sales, according to a company release.
A revenue run rate refers to projecting a company's future financial performance based on its previous revenue within a given period of time.
Neither Tate nor Oats Overnight responded to a request for comment Monday on the company's recent funding raise and expansion plans.
Oats Overnight bringing customers into research and development process
Tate, a former professional poker player, founded Oats Overnight in 2016. He created the company’s initial recipes as a way to fit a nutritional breakfast into his busy schedule. Those recipes evolved into a spoon-free oatmeal that’s made via combining oats and milk in a shaker bottle, which is then refrigerated and ready to consume in the morning.
The company raised $2 million in seed funding in 2021 in a round led by Los Angeles-based Schnitzel Capital with participation from Utah-based SpaceStation Investments and Costella Kirsch in California, the Business Journal previously reported.
Oats Overnight now manufactures more than 35 flavors of packaged, high-protein oatmeal, some of which include maple pancakes, cinnamon roll, peach upside down cake and chocolate chip cookie dough. The company’s packaged oats are sold in a variety of stores, such as Whole Foods, Meijer, Walmart, and HEB.
The company has more than 250 employees, including multiple food scientists, a supply chain team and a quality department.
Oats Overnight said it’s bringing consumers into the research and development process by communicating with them for new flavors to launch.
As part of the process, a new flavor is shared with more than 100,000 of the company’s subscribers each month. Subscribers also get the benefit of mixing and matching flavors for shipment.
After surveying customers and gaining feedback, the company’s most popular flavors are released to the market.
"Owned manufacturing, fulfillment and R&D is absolutely critical for the company to deliver on its model for innovation and product development," Vincent Comerford, Oats Overnight’s chief operating officer, said in a statement.
