Grove Collaborative Secures $15M PIPE Investment from Volition Capital

Grove Collaborative Holdings, Inc. (NYSE: GROV), the world’s first plastic-neutral retailer and a leader in sustainable consumer products, has secured a $15 million investment from Volition Capital, a prominent growth equity firm. This brings Volition’s total investment in Grove to $25 million, following a previous $10 million investment in August 2023 through the purchase of Series A Convertible Preferred Stock.

The investment was led by Larry Cheng, managing partner and co-founder of Volition Capital, who also serves on Grove’s Board of Directors. Cheng has a notable history of successful investments, including Chewy, an online pet supply retailer, and currently serves on several other boards, including GameStop.

Grove plans to use part of this new investment, along with its existing cash reserves, to pay off the remaining $30 million of its term debt facility. The company has committed to using at least $10 million of the proceeds to reduce this debt by November 30, 2024. This follows a previous $42 million debt repayment made in July 2024. After the full repayment, Grove’s remaining debt will consist of only $7.5 million under its asset-based loan facility.

As part of the investment agreement, Volition forfeited its existing warrants to purchase 1.6 million shares of Grove’s Class A Common Stock and agreed to modifications to its Series A Convertible Preferred Stock. In exchange, Grove issued 15,000 shares of Series A’ Convertible Preferred Stock, which can be converted into approximately 7.76 million shares of Grove’s Class A Common Stock at a 45% premium to the stock’s 30-day average price. Larry Cheng will continue his role on Grove’s Board of Directors. Additional details can be found in the company’s Form 8-K, to be filed with the Securities and Exchange Commission on September 23, 2024.

Jeff Yurcisin, CEO of Grove Collaborative, expressed enthusiasm for the investment, stating, “This $15 million investment from Volition Capital and Mr. Cheng reinforces confidence in Grove’s strategy and mission. It will enable us to eliminate term debt, marking a significant milestone in our turnaround strategy as we aim to deliver sustained revenue growth and shareholder value.”

Larry Cheng, managing partner at Volition Capital, highlighted Grove’s success in improving its fundamentals, saying, “The Grove management team has made significant strides in profitability, delivering four consecutive quarters of positive adjusted EBITDA. With this investment and the planned debt repayment, Grove’s balance sheet will strengthen, positioning the company for future top-line growth.”

Volition Capital, based in Boston, specializes in growth equity investments in founder-owned companies across sectors including software, Internet, and consumer products. Since its founding in 2010, the firm has managed over $1.7 billion in assets and invested in more than 50 companies across the U.S. and Canada.

About Grove Collaborative Holdings, Inc.

Grove Collaborative is an online destination for sustainable everyday essentials. Offering over 240 brands, including household cleaning, personal care, clean beauty, and pet care products, Grove is committed to helping consumers make eco-friendly choices. The company is driven by the belief that creating a better world starts with what people bring into their homes.

About Volition Capital

Volition Capital is a Boston-based growth equity firm focused on investing in high-growth, founder-led companies across the software, Internet, and consumer sectors. With over $1.7 billion in assets under management, Volition partners with companies to support their growth and long-term success.

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