Berlin-based Mammaly just closed a €14m Series A growth round to build its offline and online supplements empire, backed by Five Seasons Ventures, Iris Ventures and pet product expert and investor Attila Balogh.
Following on the heels of the £280m Butternut Box raise (Butternut Box is a fresh dog food delivery startup), it was another sign of pet startup resilience in a sedate funding environment — at least outside of AI.
The pet wellness space is in, well, good health. Pet ownership has surged thanks to demographic factors — more millennials and Gen Zs choosing pets over children, in their younger years at least — and rising adoption during the pandemic. Pets have become “humanised” as owners favour high-quality and premium products.
But pets face similar health issues to humans, especially in their dotage, from dental and skin disorders to obesity and arthritis, which could be mitigated or forestalled by nutritional improvements.
Interest in supplements
Canine Arthritis Management, a veterinary health website, says over 80% of dogs over the age of eight have arthritis. According to VCA Animal Hospitals, over 50% of dogs in North America are overweight and the Royal Veterinary College says 87% of dogs over the age of three have periodontal issues. Nutritional deficiencies could be to blame, with Omega-3 fatty acids and vitamins A (beta-carotene), D, E and B2 (riboflavin) among them.
But supplements are usually administered only once a pet is unhealthy — often provided by vets.
They are challenging the mass market one-size-fits-all products targeting pet nutrition
Mammaly, however, offers a tastier chew rather than powder or pill format and a direct-to-consumer, preventive-focused business model, with a team combining veterinary expertise and product specialists.
“Mammaly has successfully made pet supplements into mainstream functional treats you can buy normally, not just from vets,” says Niccolo Manzoni, managing partner at Five Seasons Ventures.
“They are challenging the mass market one-size-fits-all products targeting pet nutrition, which are highly processed,” adds Florian Wojewodzki, partner at Iris Ventures, a €100m European early-growth consumer fund.
Following the US boom
Mammaly is following the lead of the US-led boom in pet supplement startups like Zesty Paws, acquired by H&H Group in 2021 for $610m, Pet Honesty and PetLab.
The pet supplements category has seen explosive growth in recent years, especially in the US
The size of the US market offers protection for European startups, as there is plenty of space for American firms to grow at home.
“The pet supplements category has historically been small and slow-growing, but has seen explosive growth in recent years, especially in the US,” says Alexander Thelen, cofounder of Mammaly. “In the US, about 50% of adults take supplements regularly. In Europe, it's around 25%. We see this adoption of human behaviour to pets.”
The global supplements market size was estimated at $2bn last year.
The investor’s view
Five Seasons Ventures has marked itself as one of Europe’s shrewdest pet tech investors — with a portfolio including Butternut Box, from which they exited following the company’s new raise, and Portuguese food and health subscription service Barkyn. This gives Mammaly access to expertise and networks touching some of the most successful European startups to date.
In mainland Europe, there is no-one tackling the pet supplements space
On the other hand, Florian Wojewodzki at Iris Ventures says his fund has looked at the pet space for a while, but this is their debut investment in the sector. They liked Mammaly’s first-mover advantage in the Germany, Austria and Switzerland (DACH) region as well as its global ambition.
“When we started talking to the founders, we could see these were dynamic, thoughtful, intelligent leaders that were steadfast in their approach and very focused, but also with global ambition,” he says.
Wojewodzki says the fund was also excited by Mammaly’s engagement strategy beyond the core product: “Businesses that are savvy and digitally native, who know how to build community and who know how to educate people on the functional benefit of products, drive a really solid model of customer engagement.”
He also credits the company’s high growth, capital efficiency, low cash burn and good unit economics. Following an era of over-hyped startups without revenue or product-market fit, 2023 could be the year that well-run businesses get the attention and funding they deserve.
“Many investors have money but few good assets to invest in, so they are eyeing the steadily growing pet category,” says Thelen.
The Series A investor lineup brings complementary skills and competencies, adds Manzoni.
“You need a solid brand that resonates among consumers [to] reduce your marketing cost and that’s one element that Iris Ventures brings, among others,” he says. Pet food and consumer specialist Attila Balogh, another investor in Butternut Box, brings product-level expertise, and Five Seasons Ventures, the lead, has strong relationships with pet retailers and in scaling.
Mammaly, which is now hiring 10 to 15 roles in marketing, supply chain and finance, plans to focus on growth in offline retail within the German market, which it says accounts for 80% of revenues, and to expand internationally, too.
“In mainland Europe, there is no-one tackling the pet supplements space.”
This article first appeared in our monthly Unleashed pet tech newsletter, a collaboration with Purina Accelerator Lab. All content is editorially independent. Sign up to our newsletter here to keep up to date with the latest goings on in the European pet tech industry.