Gore Fund Fuels Seventh Generation Acquisition Effort
Burlington-based Seventh Generation is embarking on a more aggressive effort to acquire other companies. A $30 million investment from the London-based Generation Investment Management Fund co-founded by former vice president Al Gore will allow Seventh Generation to help pay for the effort.
Seventh Generation CEO John Replogle says acquisitions mark a new phase for the 26-year-old company. He says the shift comes at a time when the economy is strengthening.
“The market has moved. Consumer confidence has returned; people are making choices for values over value,” says Replogle.
With its investment Gore’s fund becomes the third largest shareholder in the privately held company.
"I would think about the $60 million as a good down payment with the ability to go much deeper if we need to." - Seventh Generation CEO John Replogle
Seventh Generation, which sells household and personal care products, is one of more than 1,100 Benefit Corporations, or B Corporations, that meet certain standards in the products they make, their relationship with workers, and their impact on the community and the environment.
Replogle says it’s a good time for Seventh Generation to acquire other companies that share those values.
“There are more and more companies started every day and more growing up that have clarity of purpose, alignment of mission, that really think about people, planet and profit. So we have many more choices today than we did five years ago,” he says.
In addition to $30 million dollars from Gore’s investment fund, Seventh Generation has secured an equal amount in credit from Toronto-based TD Bank.
“$60 million is sufficient to get started,” Replogle says. “We also have a very committed set of investors and a board and access to sufficient additional capital should we need it if we find good strategic investments. I would think about the $60 million as a good down payment with the ability to go much deeper if we need to.”
Seventh Generation’s acquisition phase began last year when the company bought Bobble, a reusable bottle that filters water.
This year, it acquired the Gamila Company, which makes a single cup coffee brewing system and a tea infuser.
Unlike the popular single-serve K-Cups made by Vermont’s Keurig Green Mountain, the system doesn’t use any non-recyclable components.
Replogle acknowledges the Gamila system isn’t a threat to a company the size of Keurig Green Mountain.
“They are so much larger than us. All we’re looking to do is bring innovative solutions to this growing trend of waste creation,” he says. “We hope that ultimately they’re going to step up and figure out a more sustainable solution, but in the interim we’re giving consumers a choice.”
Replogle says Seventh Generation expects to add an additional brand to its portfolio each year for the next four or five years. The brands will be part of a wholly owned subsidiary called Seventh Generation Ventures.