Nick’s: Swedish Sugar-Free Ice Cream Feat. Perfect Day Tech Raises US$30M To Fuel U.S & Germany Expansion

Sweden-based brand Nick’s, parent company, LUB Foods recently secured US$30M in funding that will execute its plans for international expansion of its sugar-free ice cream products, mainly in the U.S. and Germany, along with building a production facility in Europe, including three flavours featuring Perfect Day’s animal-free whey protein.

Looking to reinvent the ice cream space, Nick’s entered the U.S market in late 2019 with a line of light ice creams. Its recent round of funding was led by Stockholm-based investment group Gullspång Invest, who were early investors in Oatly, and European food tech fund Capagro including support from Khosla Ventures, DNS capital, Djursholm Investment Group, and Skandrenting AB.

In tandem with this, the company has also hired former CEO of skyr brand siggi’s and dairy industry veteran Carlos Altschul to manage its U.S. business.

Back in 2014, Swedish mechanical engineer Niclas Luthman was diagnosed as pre-diabetic resulting in him changing his diet and starting Lub Foods, the parent company of Nick’s and now its products have expanded to more than 15 European markets and the U.S.

Creating a range of snacks that have no added sugar, gluten or palm oil, Nick claims that its most recent ice cream offering has 70% fewer calories than other leading brands on the market along with having an exclusive license to use EPG, a plant-based fat replacement component, created by Epogee, which is a rapeseed oil-based fat substitute that can reduce fat calories by 92% as the oil cannot be absorbed by the body.

While speaking to FoodIngredientsFirst, Stefan Lagerqvist, Nick’s CEO said: Our key focus is to continue our international expansion with the US being our highest priority. We are also continuing our geographical expansion in Europe. We will use part of the funds to set up a new factory in Europe as we have almost outgrown our current factory. As consumers spend more time in their homes a lot of the consumption follows. We can therefore see that the ice cream category is growing at retailers, but even more so online with consumer behaviors shifting toward online shopping.”

Our key focus is to continue our international expansion with the US being our highest priority. We are also continuing our geographical expansion in Europe. We will use part of the funds to set up a new factory in Europe as we have almost outgrown our current factory

Stefan Lagerqvist, CEO of Nick’s

Aside from using EPG, Nick’s products don’t use regular sugar but instead sweeten the offerings with natural substitutes, such as stevia, monk fruit, erythritol and xylitol.

In an interview with FoodNavigator-U.S, Altschul said: “We see a lot of opportunity in other categories, but our focus for now is ice cream. We started in November 2019 with a regional launch at ShopRite in the northeast and our goal was to become the highest velocity better-for-you ice cream in the laces where we got distribution. We achieved that and closed the year – despite all the difficulties with the pandemic – with more than 4000 stores. We’ve got a good presence with all northeast retailers, we’ve expanded with Albertsons on the west coast, and we’ll be in all west coast Kroger banners starting this spring. We have a product that is disrupting this segment and we want to get it in front of more consumers with over two-thirds of the raised capital allocated to the U.S market.”

As consumers spend more time in their homes a lot of the consumption follows. We can therefore see that the ice cream category is growing at retailers, but even more so online with consumer behaviors shifting toward online shopping

Stefan Lagerqvist, CEO of Nick’s

The company also worked with California-based food tech, Perfect Day, who invented the world’s first animal-free whey protein that’s similar to the protein in conventional milk but without any cows involved in the process. 

The duo unveiled a vegan ice cream collaboration and as a result, Perfect Day’s animal-free dairy proteins are being used in three of Nick’s vegan flavours – Swedish Mint Chip, Karamell Swirl and Choklad Choklad. According to a press release by Nick’s, seven more flavours will be made available with Perfect Day, along with the flavors making a debut at grocery stores in the spring.

Discussing Nick’s plans for the future, Lagerqvist mentioned: “Our latest launch of low-calorie ice cream, without added sugar, during the spring has been very successful and we are now leading the better for you ice cream segment. Our ambition is to replicate the success outside of Sweden and that’s why we raise capital – to fuel our global growth.”

At the moment, Perfect Day is the most well-funded fermentation protein company with news of its record-breaking US$300 million Series C round announced last year. 

Apart from Nick’s, Perfect Day’s fermentation dairy proteins have also been used to create animal-free ice creams and other dairy products in the U.S., such as Brave Robot ice cream, a new brand launched under Urgent Company.

Stepping into the Asia market, Perfect Day recently partnered with Hong Kong’s Igloo Dessert Bar to debut Asia’s first-ever animal-free ice cream made with real dairy proteins, without any cows and dubbed as Ice Age!, the brand will offer a range of eight lactose-free, hormone-free and vegan-friendly ice creams. Furthering its commitment to growing the fermented dairy sector in Asia, Perfect Day will also open its Singapore-based R&D centre this year, in partnership with the government-run Agency for Science, Technology and Research (A*STAR). 

Lead image courtesy of Nick’s Facebook.