Supplement Brand Goli Nutrition Sells To Avoid Bankruptcy

After finding itself in a sticky financial situation, popular apple cider vinegar gummy brand Goli Nutrition is being sold to a business consortium involving Group KPS, Bastion Capital and one of its original founders.

The sale staves off bankruptcy proceedings for Goli, which asserts it will be a balance sheet booster and drive merchandise, retail and geographic growth. The transaction is part of a process under Canadian law allowing corporations owing in excess of $5 million to creditors to restructure. Although Goli is operationally headquartered in West Hollywood, Calif., it’s legally headquartered in Montreal and obtained on order from the Superior Court of Quebec on Tuesday to stay bankruptcy proceedings and move forward with the sale. 

As its ownership transitions, Goli insists its management team and retail distribution won’t be impacted. Bruce Weiss, formerly VP and head of the health and well-being unit at Church & Dwight, is CEO. In an email statement, a spokesperson for Goli said, “We will continue to deliver our innovative products to our valued customers, distributors and retailer partners worldwide. The transaction will provide Goli with greater resources to invest in innovation and marketing initiatives, while further strengthening our supply chain.” 

Goli is stocked at thousands of mass-market and specialty retail doors nationwide at chains the likes of Ulta Beauty, CVS, Target and Walgreens. It’s available on Amazon, too. Goli’s assortment spans a dozen gummy supplements, including bestseller Apple Cider Vinegar Gummies. They’re all priced at around $19 for a single purchase. According to Goli, the brand has drawn over 5 million customers to its direct-to-consumer platform, where it offers products on subscription at a discount. 

Goli characterizes its lenders as fully behind its sale and describes Bastion Capital as having an extensive track record with consumer businesses. Group KPS, another member of the acquiring consortium, is a healthcare company with an expansive distribution network in Latin America. It currently distributes Goli in Mexico.

“Group KPS is a long-standing distributor of Goli products, and we see strong long-term potential in the company’s iconic brand, exceptional product quality, and high repeat purchase rates across its loyal consumer base,” said Group KPS CEO Felipe Preciado in a statement. “We are excited to enter into this acquisition to enable Goli to unlock new growth opportunities and do what it does best in bringing innovative products to consumers worldwide.” 

Goli was launched in 2019 by Michael Bitensky with vegan organic Apple Cider Vinegar Gummies. Deepak Agarwal, a serial entrepreneur and investor, helped Bitensky get the brand off the ground and is considered a co-founder. Goli’s idea was to make beneficial yet bitter ACV palatable, and consumers quickly cottoned to it. The brand’s sales skyrocketed out of the gate.

Nutrition Business Journal estimates Goli grew 25% from 2020 to 2021 to reach $438 million in 2021 sales, placing it among the top 25 supplements brands in the United States. Influencer and celebrity marketing (Goli partnered with Jennifer Lopez, Alex Rodriguez, Miley Cyrus and Demi Lovato), pandemic-stoked heightened interest in wellness and consumers’ bigger appetite for gummy vitamins were critical to Goli’s sales success. 

In late 2020, PE Hub covered the brand’s engagement of Centerview Partners for a possible sale, but the sale didn’t come to fruition. The publication reported that the brand was forecast to generate $75 million in earnings before interest, taxes, depreciation and amortization (EBITDA) and $750 million in revenue in 2021, a year that marked private equity firm VMG Partners investing $100 million in the brand.

Following VMG’s investment, Goli faced mounting problems. It was slapped with class-action suits over health claims, and its former manufacturer, Better Nutritionals, sued the company for up to $900 million after the manufacturer filed for bankruptcy. In its lawsuit, Better Nutritionals details that it enlarged its capacity based on Goli’s sales projections and the sales projections turned out to be wrong, leaving it with millions of bottles that went unsold. 

Despite its troubles, Goli was rolling out new products for a stretch in 2023. From March to June, the brand launched PMS Relief Gummy, 3-in-1 Pre+Post+Probiotics Gummy and Beets Cardio Gummies on its website and in stores at Target, among various retailers. 

The legal issues coupled with the fizzling of the pandemic’s intense focus on wellness appear to have taken a significant toll on Goli. Joseph Zigelboum, founder of beauty brands Brooklyn Botany and Tumeri, believes tricky conditions in the supplement sector could be causing difficulties for it as well. “The product costs a lot to make, and Goli doesn’t skimp on their custom packaging inside and out,” he says. “In addition to the high product cost, the average order value is still quite low for a DTC brand. So, now you have a small margin to work with.” 

Zigelboum continues that supplement brands such as Goli often run into hurdles on social media platforms that limit their power to advertise. In addition, he says, “You have cold storage logistics so the gummies don’t melt and a small expiration window before the product expires and then ends up being sold at a major discount to stores like T.J. Maxx. Lastly, [there’s] very intense competition. You have brands like Lemme launching and doing the exact same thing, but appealing to a younger demographic and with the Kardashian brand behind it.”

Acquisitions in the space have continued to trickle in recently. In 2022, Unilever acquired hair wellness company Nutrafol and Biocodex scooped up clean OTC product specialist Hilma. Late last year, Pharmavite acquired Menopause-focused supplement specialist Bonafide and in January, it was revealed that Dr. Reddy’s Laboratories had acquired MenoLabs from Amyris.

Rachel Hirsch, founder and general partner of wellness investment firm Wellness Growth Ventures, is reluctant to draw broad category conclusions from Goli’s struggles. Still, she notes that increasing consumer demand for science-backed innovation presents competition for incumbent brands. 

“Moving forward, companies in this sector may need to focus more on evidence-based claims and product efficacy to thrive in a competitive market,” says Hirsch. “The M&A market in CPG has generally slowed, especially for companies that have not achieved EBITDA positivity and are experiencing declining sales. This situation underscores the importance of building a strong, sustainable company with solid financials and a strong foundation.”