Davis healthy snack company Rivalz Snacks has raised $6.1 million in venture capital funding to expand its production, sales and marketing nationwide of nutritional salty snacks.
The funding was led by The March Group, a venture capital investment firm based in Davis and Hong Kong, and it brings Rivalz to a total of $8.4 million raised since it started up in 2022.
Rather than just being a snack food, Rivalz features vitamins, high protein and high fiber to be a nutritional food and not just empty calories, said CEO Peter Barrick.
Rivalz uses pea protein and brown rice to make its products, which are baked rather than deep fried. The upshot of that technique and ingredients is that its salty snacks are high in fiber, high in protein and still pack an indulgent and satisfying flavor, he said.
One of the issues the company had to overcome was developing a method to extrude its ingredients in a way that worked, and that took artificial intelligence to go through 500,000 potential methods to make its products, which are stuffed morsels with two differing textures, he said.
The company calls the technology “AI you can taste,” Barrick said.
Rivalz makes flavors that now include Late Night Pizza, Extra Chedda’ Mac and Spicy Street Taco.
The first wave of commercial snack foods in the 1950s and 1960s was made of wheat, corn or potatoes, and they are basically empty calories, Barrick said. Those high-carbohydrate traditional snack foods tend to use those ingredients because they are cheap and easy to extrude.
The next wave of snack foods in recent years was an attempt to better source ingredients, but the end products are still basically empty calories and generally not healthy, Barrick said.
Rivalz snacks have four times the protein of most commercial chips, much more fiber and nutrition and they are vegan, gluten-free, non-GMO and dairy-free.
The company is fully remote now, but it eventually plans to open an office in Davis, somewhere close the University of California Davis, Barrick said. Rivalz has many associations with the university, where Barrick earned his undergrad degree and MBA.
The company has 22 employees, with nine of them full time. That employee count doesn’t include the contract manufacturer that produces and packages Rivalz locally. Barrick declined to say which company makes the product. That company is highly automated, which will allow Rivalz to grow to $120 million in revenue before it has to find more suppliers or manufacturers, he said.
The company only started selling its product less than 10 months ago, but it is on track to reach revenue of $1 million in its first year.
Rivalz snack foods are predominantly now sold on Amazon (Nasdaq: AMZN), where they have seen 50% growth per month since they were introduced, Barrick said. The packaged snack food is also in 14 Sprouts Famers Market Inc. (Nasdaq: SFM) stores and some other specialty retailers. Rivalz has gotten placement in 10 school districts, including the Los Angeles Unified School District, as well as five universities. Barrick said it will even put its snacks in military meal kits, where the government wants nutrition and satiating qualities in soldiers' food.
