Gainful, a startup bringing personalization to the sports nutrition industry, is powering its new Hydration line of electrolyte drink mixes with aid from a $7.5 million Series A funding.
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Founded by Eric Wu and Jahaan Ansari in 2017, the company finished Y Combinator in 2019 and raised a seed round of $120,000. The pair met in high school while playing sports.
“Teammates would chug a nasty protein shake, but they didn’t know why, only that their favorite athletes were doing it,” Wu told Crunchbase News. “After playing soccer, I wanted to get a grasp on my health, but it is an off-putting experience to go into the GNC.”
Wu ended up doing some “home cookery” in his kitchen with raw ingredients as a first attempt at making his own protein blend that worked for his dietary needs and health goals.
“I told Jahaan about it, and we were so jazzed that it spurred me to take the idea more seriously,” he added.
The Series A round was co-led by BrandProject and Courtside Ventures, with additional financing from AF Ventures, Round13 Capital, Barrel Ventures and the founder of Polaris Sports. Including the new funds, Gainful has raised just over $10 million, Wu said.
Deepen Parikh, partner at Courtside Ventures, said his fund invests in early-stage companies in the fitness and wellness, sports, gaming and media industries. He came to know Gainful last April and said he became a quick believer in the team and what they were building. Ultimately, its first investment in Gainful was one of his first deals amid the global pandemic, Parikh said.
“When you look at what exists today, the personalized nutrition market is $5.6 billion and growing, while general nutrition is a $40 billion market,” Parikh said. “This industry is about building relationships of trust and transparency. What we saw in Gainful was that, just in a few years, there were many people who loved the product already.”
Gainful’s technology takes into account a customer’s exercise habits, physiology, dietary preferences and fitness goals with information gained through an online personalization quiz and proprietary algorithm, to determine protein and electrolyte requirements.
Between 2019 and 2020, the company has processed nearly 2 million quizzes and saw its revenue more than double, as well as increasing employees from fewer than 10 to 23. Wu intends to use the new funding to continue building the team and create more products with the same scope of the company’s recently launched Hydration product line of electrolyte drink mixes.
The company’s Hydration product, based on customers’ workout frequency, intensity and sweat level, combines four electrolytes with a small amount of sugar to activate sodium-glucose co-transport, hydrate cells faster than water alone, which supports a faster recovery and better performance, Wu said.
“We are subscription-only and the vast majority of orders are folks that have been with us for months, so the loyalty flywheel has paid dividends and put us in a good position for 2021,” he said. “The ability to raise more money in this Series A will enable us to build a dream team of investors we know would give us an edge. We didn’t need to raise money, but we decided to take the money so we could reach profitability and accomplish our new product goals.”
Illustration: Li-Anne Dias
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