Premium dog food Lyka has completed one of the biggest Series B funding rounds this quarter, closing on $30 million after an Israeli entrepreneur known for his investment in Adobe’s Frame.io got behind the Australian startup.
Lyka was co-founded by vet Matthew Muir and consultant Anna Podolsky, after her eponymous border collie had a bad reaction to regular pet food brands and began to experience declining health, despite being just five years old at the time.
The pair began exploring raw food diets for pets and found research that suggested the average lifespan of some dog breeds has been slashed by up to 40% since processed pet food dominated the shelves, which gives furry friends a heightened risk of cancer.
“The Australian pet food industry is largely unregulated, and when it comes to commercial pet food, you often don’t know what goes into the food you’re putting into your dog’s bowl — it’s quite scary and one of the key reasons as to why Lyka came to life in the first place,” Podolsky told SmartCompany.
“Store-bought food is often filled with pet-grade ingredients instead of wholefoods, and has a high carbohydrate content and is ultra-processed, which means that any nutrition has effectively been removed.”
In 2018, Lyka was born, with 10 million pooch meals prepared since. It’s a subscription service for pet food, which is tailored to the specific needs and breed of a person’s dog as detailed by the customer in a profile upon sign-up.
“Some of the benefits I see in clinic when feeding a low carb, highly digestible diet includes softer coats, less skin irritations, improved digestion and stool consistency, and better mood stability with fewer sugar crashes,” Muir said.
“I’m so proud of what we’ve achieved at Lyka and love hearing from families that have seen and experienced these benefits in their furry family member.”
Muir and Podolsky raised $6.5 million from investors Shearwater Capital and Wattle Hill Capital that year, as well as founding chair of Pet Circle Craig Blair and Petbarn founder Paul Wilson, which the pair parlayed into expanding the production and distribution of the products.
In 2018, Shearwater founder Zac Zavos said his company typically looked to invest in software companies that embrace reoccurring revenue streams, but was impressed by Lyka’s figures.
“When you look at the data in terms of the customer cohorts, there is a clear opportunity for Lyka as a scalable subscription model within the pet food category,” Zavos said at the time.
“Anna is the founder we’re backing to really scale this opportunity.”
This time around, Blair and Wilson joined lead investor Israeli entrepreneur Itai Tsiddon — founder of video and photo editing app Lightricks and the lead investor in Frame.io which Adobe acquired for US$1.3 billion.
Podolsky says she was thrilled about the $30 million investment, which comes as the pet care sector is forecast to grow to $500 billion globally in five years.
“Pet nutrition is something that Australians are really opening their eyes to in recent years and we’re really excited to see pet parents investing in their dog’s life longevity and health,” Podolsky said.
“We’ve had countless customers stop their dog’s skin steroid injections, reduce arthritis medication and even stop needing to visit their vet to have their dog’s anal glands expressed.
“We’ve even had dogs significantly outliving their cancer prognosis, so it’s incredible to see and hear the life-changing impact that fresh food is having on dogs and their parents.”
When asked whether Lyka will diversify her range into cat food, Podolsky’s cryptic response was “watch this space”.
“Pets are life for us here at Lyka and we have some very exciting plans to help improve the lives of more furry family members,” she said.
But for now, Podolsky’s just stoked that her range is making a difference in the lives of Australian dogs.
“We know how good we feel when we eat fresh food and the same goes for our dogs,” she said.
“Our dogs are so much more than family and deserve to eat like it!”
Emma Elsworthy is Climate Editor at Crikey, SmartCompany, and The Mandarin, and writes daily morning newsletter the Worm. Before joining Crikey in 2021, Emma was a breaking news reporter in ABC’s Sydney newsroom, a journalist at BBC Australia, and a journalist in Fairfax Media’s regional network. She was part of a team awarded a Walkley for coverage of the 2019-2020 Black Summer bushfire crisis, and won the Australian Press Council prize in 2013.
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