We Revamped a Snack Company. It Just Sold for Millions.
The State of the Brand
Talk about an origin story: The Kar Nut Co. started as a family business selling roasted peanuts at Detroit’s Tiger Stadium in the 1930s. Over the decades, Kar’s became a beloved Michigan snack brand offering nuts and trail mix primarily through vending machines. Following a transfer of ownership in the ’70s, the brand spent several decades expanding into the value channel.
Palladium Equity Partners acquired the company in 2017. At that point, Kar’s had launched Second Nature, a startup brand promising natural, non-GMO, premium snacks and trail mixes. Palladium came to us for guidance. Then in 2019, Palladium recruited former Mars Wrigley executive Vic Mehren as CEO.
“Retail Voodoo put us on the path to enjoy tremendous growth, while ensuring our family legacy and brand values remained intact.”
— Nicolas Nicolay (CEO and Chariman, Kar’s and Second Nature)
How We Helped
The key question our 360° Brand Development Process sought to answer was, Can these two brands — one legacy, one startup — bookend the trail mix category? In other words, how can we maximize growth for these two brands without one cannibalizing the other?
Our insight revealed that the company needed to build an audience strategy that went from the Midwest out. Based on the product mix and audience profile, we recommended that the two brands pursue distinct segments and channels.
With a clean ingredient profile and a female-forward audience attuned to health and wellness, we positioned Second Nature as a premium better-for-you brand. We knew that retailers, particularly on the West Coast, would respond to Second Nature’s upscale BFY profile more favorably than they would the Kar’s brand.
Kar’s had traditionally been marketed to the so-called Bubba audience, sold in single-serving sleeves in vending machines and convenience stores. We repositioned the brand to appeal to a family audience, with large package sizes and kid-friendly flavors.
Our work with the two brands also involved their product pipeline and recipe innovation. We advised upgrading the Kar’s product matrix to include more interesting flavors, and we recommended a more robust innovation process for Second Nature, to develop gourmet flavors and more indulgent fruit and nut blends. We built a 5-year product development and distribution pipeline and helped infuse a spirit of innovation throughout the organization.
Under Mehren’s smart leadership, the company followed our brand playbook to a series of wins. Both brands grew like crazy. The company was renamed Second Nature Brands and acquired the Michigan-based Sanders Chocolates. In 2021, the company introduced more than 25 new products across the three brands.
In an article for Food Business News, CEO Vic Mehren said, “These businesses have grown significantly over the last several years, and we see many opportunities for expanding our new platform both through brand innovation, strategic investments and acquisitions. Under the Second Nature Brands umbrella, our market-leading brands are positioned for accelerated growth.”
And in April 2022, Palladium sold the company to CapVest Partners, a London-based global investor focused on the food industry, for an undisclosed sum.
Commenting on the transaction, Othmane Khelladi, Partner at CapVest, said, “Second Nature Brands is a very exciting platform with ambitious plans to grow its presence in the highly attractive snacking and treats market.”
It’s a great story: from regional blue-collar player to company with a multimillion-dollar portfolio of category-leading brands. If you’re curious about how we did it, and how we can lead your brand to similar growth, let’s connect.