“This $3 million investment with Proterra is ... not inventory financing. It is for growth. So, that is talent, that is marketing, that is sales team, innovation and working on a new product line,” Griffith said. “[We are] taking advantage of this epic timing and momentum that we have with our business and with buckwheat.”
‘We were supposed to run out of money on my wedding day’
Founded in 2018, Lil Bucks offers a range of sprouted buckwheat products, including buckwheat clusters (Clusterbucks), seasonings and a standalone product that can be used as a topper to salads, smoothies, cereals or other dishes. Buckwheat are pseudo grains that are often used in allergen-free products like gluten-free breads and snacks.
Lil Bucks launched at Target earlier this year and rolled out nationally at Whole Foods stores last fall, following a Midwest launch.
Lil Bucks was a part of the 2021 Target Takeoff Food & Beverage Accelerator, an annual competition where startups receive mentorship and financial support. Despite winning the Target award in 2021, Lil Bucks delayed its launch in the retailer to ensure that it had the brand recognition and financial support to succeed in stores, Griffith noted.
Leading up to the retail launches, Lil Bucks extended its runway and conserved capital amid the capital crunch of the last several years, she explained. Griffith sought out the “leaky buckets” in her business by “properly monitoring distributor and trade spend” and used a variety of financing options to fund her business.
"We were supposed to run out of money on my wedding day, which was in June 2022, so we had to extend,” Griffith said. “[We did] lots of debt financing avenues. We have done crowdfunding. I did a [COGS Agreement Retaining Equity] note.”
A cost of goods sold (COGS) agreement retaining equity (CARE) note is a framework developed by Elliot Begoun, founder of advisory group TIG Collective, where a founder and funder decide on an investment amount, and with funds to be paid quarterly based on a percentage of COGS. Lil Bucks raised $400,000 on a CARE note last fall "to help finance inventory for the Whole Foods national launch," Griffith explained.
Building a buckwheat supply chain in the US
Griffith came up with the idea for Lil Bucks after having “a life-changing açaí bowl” with buckwheat while living in Australia, she said. She wanted to bring buckwheat to more US consumers and educate them on its nutritional benefits, including its high fiber and protein content.
Upon returning to the US, she called farmers in the Midwest to find one that would grow buckwheat. Eventually, Lil Bucks secured its first direct farm partnership with USDA-certified organic farm A-Frame Farm in Madison, Minn.
“I ended up speaking with a few farmers that [said], ‘We love buckwheat because of the soil health benefits, and I would love to grow more of it, [but] there is just not really a market for it.’ ... I was noticing most buckwheat consumed in the US was coming in from China, and then most buckwheat grown in the US, which is not enough ... was being exported to Japan,” she elaborated.
At the same time the US buckwheat supply chain is being built out, consumers are becoming more familiar with the ingredient, as they seek more nutritional ingredients, Griffith explained. Whole Foods highlighted buckwheat as a key trending ingredient in its 2024 trend list due to buckwheat’s nutritional content and being used as a cover crop to support sustainable agriculture.
"After COVID, with everyone being more conscious and aware of what they are putting in their bodies in general and [being] very health conscious, people were a lot more open-minded to trying this ingredient," Griffith said. "There was a notable switch ... of people's openness to trying sprouted buckwheat and their excitement to try it verse before the pandemic. So, it is all these macro and micro trends coming together for the perfect buckwheat storm."
