Better Bean is the latest Portland-area brand to embrace small business bonds

Better Bean founders Rocio Ríos and Keith Kullberg share their detailed, and compelling, story.

Portland Plant Foods

By Malia Spencer - Portland Inno

June 17, 2022, 03:04pm PDT

Keith Kullberg describes the current incarnation of his product as Better Bean 3.0.

The line of ready-to-eat beans and hummus sits next to tubs of salsa and guacamole in grocers' deli sections.

But that is just a part of Better Bean’s current story.

Kullberg is rebuilding the company that he and his family initially started in 2010. The business went from startup to sale to corporate owner to back to its founding family.

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It’s this last bit where Kullberg is turning to fans of the brand and other plant-based food advocates for support through a crowdfunded debt offering. The company is the latest Portland area business to sell small business bonds on the emerging platform SMBX.

The company seeks to raise a maximum of $100,000 by selling bonds that have 8% interest. The campaign ends July 5. By June 14, the company had already sold $30,530 in bonds, which exceeds the campaign's minimum $25,000.

“I’ve always been attracted to the crowdsourcing model,” said Kullberg, noting it allows the company to build brand awareness while also raising money. “It’s not a donation. People earn 8% interest. It seemed a more clean, fair relationship beyond asking people to give you money. It gives small investors something to participate in that is higher yield.”

What is a small business bond on SMBX?

SMBX is a San Francisco-based crowdfunding platform. However, instead of selling equity in a business or offering marketing promotion, it allows non-accredited investors to loan businesses small amounts of money.

The platform is registered with the Financial Industry Regulatory Authority and businesses on the platform have been vetted. Bonds on the platform can be bought and sold on the SMBX marketplace.

Several other Oregon companies have raised debt this way, including The Cookie Department, Super Belly Ferments and Culmination Brewing.

Funds raised by Better Bean will be used for new packaging obtaining certain food safety certifications and sales and marketing.

What's going on at Better Bean?

Better Bean’s mission is to make it easy, and tasty, for customers to eat more beans. Doing so can decrease livestock intake and benefit the environment while offering healthier eating options.

Better Bean is a line of ready-to-eat bean products sold in the deli area of stores. The product can be eaten on its own or as part of a recipe such as a bowl.

Portland Plant Foods

The company started in 2010 based on recipes Kullberg and his family developed in their kitchen. This is what he likes to call Better Bean 1.0. This company iteration raised money locally from investors like Portland Seed Fund and grew. In 2017, it sold to organic and natural products company The Hain Celestial Group (Nasdaq:HAIN).

Better Bean 2.0 — if you couldn’t tell, Kullberg’s previous career was in software where the 1.0, 2.0, etc. nomenclature is used to describe product iterations — lasted from 2017 through 2020 and the brand was inside Hain. At the same time, Hain was undergoing its own pains with an activist investor.

“(Hain) changed leadership and had an activist investor and Better Bean wasn’t a priority,” Kullberg said. “We were offered a good deal to buy Better Bean back at the end of 2020.”

The company, now called Portland Plant Foods (again, for Kullberg Better Bean 3.0), has been independent again for more than a year. It has raised about $600,000 from individual impact investors and the Kullberg family. It manufactures its products at its own plant in Wilsonville.

With Better Bean the center of his attention, Kullberg is essentially restarting, prioritizing the food services market, which includes all dining outside the home.

By getting product in places like restaurants, hospitals, schools, offices and event venues, the company aims to raise awareness and drive consumers to retail stores. For example, its individual servings of hummus and black beans are sold to Portland Public Schools.

It eventually plans to build back its national distribution.

The company has 12 varieties of product in seven different sizes.

After taking a hit from Delta and Omicron variants of Covid-19, as well as supply chain troubles, the company's business is back on track this quarter. Revenue is up 80% since the fall quarter, Kullberg said.

“We are almost break-even and revenue is growing," he said. "Things are opening up and looking up for us."