DTC brand Grove Collaborative announced on Dec. 10 that it closed a $125 million funding round, according to a press release emailed to Retail Dive. Investors include Counterpoint Global at Morgan Stanley, Sculptor, Nextview and Glynn.
The natural products retailer will use the funds to expand into new categories next year and release new brands, including in the clean beauty space.
The latest funding brings Grove Collaborative's valuation to $1.32 billion, according to the company. To date, the company has generated total capital raised of $436 million since its launch in 2012, according to Pitchbook data emailed to Retail Dive.
During a financially disruptive year for many retailers, Grove Collaborative is among the list of direct-to-consumer brands finding success during the pandemic. For some, the pandemic has brought high sales records as consumers opt to shop online.
Co-founder and CEO Stuart Landesberg pitched directly to investors instead of working with investment banks — a "personalized approach" the company attributes to the funding's success given the current environment.
Despite the notion that sustainability has taken a backseat to immediate needs during the crisis, the company is not backing off its sustainable roots. Grove Collaborative noted in the press release that it chose to conduct a round because of the strong sales it saw across all categories of its products.
"While there are rumors that consumers are reverting back to 'chemical - industrial strength' during this time, our customer insights tell a different story," Landesberg told Retail Dive in an email. "We've seen strong sales across our natural product assortment in all of our categories, which shows that the trend to natural is here to stay."
A commitment to sustainability resonates with Gen Z and millennials, who tend to prioritize social responsibility and the environment when they make purchasing decisions. That demographic is particularly important to DTC brands, which are often targeted at millennials.
Last March, Grove Collaborative also committed to going plastic neutral. To do so, the company enacted a plastic tax on all owned and third-party brands.
The company achieved unicorn status last year when it raised a $150 million Series D funding round, joining others in the DTC space. At the time, Grove Collaborative planned to use the funds to expand into the clean beauty category, improve connections with customers and develop low-waste packaging and products.