UpSnack Brands Brings Pipcorn, Spudsy Together Under One Roof

Pipcorn Heirloom Snacks and Spudsy are aligning under a new banner: UpSnack Brands.

The newly formed umbrella company has acquired all the assets of Pipcorn and Spudsy with additional capital provided by the brands’ respective controlling investors, Factory and KarpReilly. Terms of the agreement were not disclosed.

Factory is the majority stakeholder in UpSnack Brands with KarpReilly being a “meaningful shareholder” with representation on the board, said Pipcorn CEO Joe DePetrillo, who will assume the executive leadership role of the new company. Spudsy founder and CEO Ashley Rogers will be leaving day-to-day responsibilities as she focuses on the baked treat brand Sprinkles.

The deal began to take form about a year ago when Pipcorn was in discussions with KarpReilly regarding an investment. At the time, representatives from the Greenwich, Conn.-based private equity firm asked if there was an appetite to put Spudsy and Pipcorn together under one company.

By scaling together, Pipcorn and Spudsy can optimize their route to market and play off each other’s strengths which is part of the “reality with brands of this scale,” DePetrillo said. “They’re too big to give up on and too small to be profitable while continuing to invest in growth and innovation.”

The two snack platforms are “complementary and like-minded in nature,” he added, and speak to a similar consumer who shops for products that represent a value proposition based on environmental sustainability or dietary needs.

Considering that consolidation seems to be a growing trend in the snack category UpSnack could provide the needed scale to compete as Mars’ impending Kellanova acquisition aims to create a new snacking superpower. Additionally, better-for-you platform Our Home has been building its own fiefdom in salty snacks with Parm Crisps, Pop Secret, Sonoma Creamery and two brands from Utz in 2024 alone.

Founded in 2012, Pipcorn initially championed the use of heirloom grain in its mini popcorn. The brand has expanded into other formats like twists, cheese balls, chips, and, most recently, puffed Fries.

Southern California-based Spudsy has been in the puffed snack category since 2018. Its approach to the better-for-you snack category centered on a Top Nine allergen-free, vegan product that used upcycled sweet potatoes. Over the years, the company has expanded its selections to include Fries and Scoops. The brand even took a step away from its previous dairy-free positioning with cheese varieties. Currently, Spudsy has eight varieties of sweet potato snacks.

For the last year, the Rogers’ team has split its time between Spudsy and the Sprinkles cupcake brand. Although the acquisition of Spudsy is not a formal exit for Rogers, she will be bringing most of her team to focus full-time on Sprinkles, which will remain in the KarpReilly portfolio.

“I’m proud of everything we’ve accomplished, and I’m confident that Spudsy will continue to thrive as part of UpSnack Brands,” Rogers said in a press release statement.

Rogers will continue to work with UpSnack “supporting the business” in a contract role, DePetrillo said, and, as a result of Rogers bringing many of her team along to Sprinkles, there will be minimal redundancies between Pipcorn and Spudsy’s union.

Paving A Path Forward Together

For DePetrillo, the job at hand is integrating Pipcorn and Spudsy under one roof in the next 45 to 60 days.

“The positive is the supply chain will work really simply, and that’s the work that we’re doing now; to integrate our suppliers, our warehouse and ship out of one location,” he said.

Once coalesced together, the business is expecting to see savings, particularly in distribution costs.

“Instead of picking up from three different warehouses, we get it all under one vendor number with all the SKUs. They can put it on one PO, they can pick up bigger loads and be more efficient,” he said. “Taking costs out of the system for everybody will hopefully translate to better retail pricing and more efficient trade events.”

There will also be some savings from manufacturing because the “processes are very similar” for many of the product lines, DePetrillo said.

Both brands use co-manufacturing partners so there will likely be some attrition along the production supply chain but DePetrillo is hoping it will be minimal.

DePetrillo has been working with the Pipcorn team to evaluate and improve efficiency along the brand’s supply chain since he joined the company in August 2021.

On a macro level, synergizing the two brands can extend to incrementally building within each brand’s strongest retail partners bringing more SKUs of both brands into stores to increase UpSnack’s presence in the aisles.

That can also be related to channel strategy. Pipcorn has been focused on building out its products in the away-from-home channel and DePetrillo said Spudsy could be used to cross-sell foodservice accounts with more variety.

Finally, DePetrillo said there was an opportunity to become more strategic with its trade spend by bringing both items off-shelf in key retailers like Whole Foods or activations to sell salty snacks to a broader consumer base.

Simply put: “The opportunity going forward is to drive innovation and expand into other areas of the salty snack set,” DePetrillo said. “Our base initiative is to accelerate our pathway to profitability through scale.”