Environmental Resilience and Inclusion Deliver $19.1 Series A
By Tim Hunt
2020 was already shaping up to be a banner year for Livermore-based Vericool and its CEO Darrell Jobe before the COVID-19 virus pandemic spread in California and sent his business volume up by 35 percent.
Vericool, founded by Jobe in 2015, makes temperature-controlled containers from plant-based materials that are reusable, compostable and recyclable. Jobe invented the patented formula himself.
His packaging provides containers for delivery of frozen or perishable foods. With shelter-in-place orders in effect across California and in most other states, the home-delivery business is soaring as many people try it for the first time. That includes pre-packed meals such as those offered by Blue Apron, Hello Fresh and other companies. He doesn’t expect the big bump to be sustained after the virus crisis passes, but does expect some percentage will like it and change their shopping habits.
The COVID-19 pandemic shelter-in-place hit in mid-March just as Jobe and his leadership team were working to close its Series A funding. The company had been funded by friends and family investors (almost $10 million over four years) and had been seeking its first round of venture funding since late 2019. The $19.1 million Series A closed on March 27, providing the runway for the company to expanded significantly. Jobe expects it will have a positive cash flow for 2020.
The funding round brought Dan Skaff onto the Vericool board as the lead director. He’s managing partner of Radicle Impact Partners. The other venture investors were Ecosystem Integrity Fund, id8investments and AiiM Partners Fund.
“We’re pleased to support Vericool because of the company’s track record of innovation, high-performance products, well-established patent portfolio and focus on environmental resilience. We are inspired by the company’s social justice commitment to address recidivism and provide workplace opportunity to formerly incarcerated individuals,” he said in a press release announcing the funding round. “Darrell’s creativity and vision for Vericool are aligned with our investment strategy of scaling businesses that are focused on diversity, equity and inclusion and deliver benefit to the environment and our communities.”
In the press release announcing the closing, Jobe wrote, “This is a transformative event for Vericool and solidifies us as the industry leader in sustainable thermal technology. Our cost-effective, patented products outperform polystyrene and can be used for many applications and customers. This new capital enables us to rapidly penetrate and support the exploding market for these environmentally-friendly solutions.” said Darrell Jobe.
Vericool plans to open a second manufacturing and distribution facility in New Jersey in May and is looking to expand into Tennessee later this year. The New Jersey facility will employ between 40-45 people, bringing the company’s headcount to more than 100. They also are hiring at their Livermore headquarters where the product is assembled.
Their business is considered essential so it’s still operating, although employees now wear gloves and masks. In running the company, Jobe has remembered his background. He dropped out of school in Richmond after the 8th grade and spent his teenage years on the streets. He was in-and-out of juvenile hall until a chaplain helped him turn his life around at 23.
He taught himself how to sell and design packaging after getting a foothold in the industry through a friend. With his background, employers did not want to hire him. To this day, he welcomes ex-cons on the payroll, knowing he had a second chance and offering the same to others.
Given the furloughs and layoffs affecting many businesses because the shelter-in-place (that’s everything from well-paying manufacturing jobs in the automobile industry to servers, barbers and hairdressers), his team is working with their temporary employment agency to see if they can reduce costs and put some of those people to work.
“One of the things we truly understand is that many people are out of work right now. We’re trying to do our part during these troubled times to help those who are unemployed,” Jobe said.
The growth in Vericool’s business is in the commercial sector, but they’re also planning a major move in the consumer sector later this year. The firm has developed its Ohana cooler that comes in 18-quart and 42-quart sizes. Ohana means family in Hawaiian and reflects a family vacation where Jobe had the inspiration to invent the coolers as an environmentally sound alternative to extruded polystyrene (Styrofoam).
The larger cooler will hold up to 100 pounds and both can hold water for at least 30 days. They’ve done a quiet launch in Lucky and Save Mart grocery stores and are preparing for a launch on Amazon later this year (the coronavirus crisis delayed the move to Amazon). They’ll sell for $4.99 and $7.99 with three packs prices at $22.99 for the large cooler. They’re also working on other retail distribution such as grocery stores and convenience outlets.
Jobe could not say enough good things about the Save Mart Companies management that he has worked with to place the coolers. “They have been absolutely amazing to work with,” he said of the Modesto-based company that operates more than 200 stores in Northern California.
In addition to the food industry and consumers, Vericool also makes products for the medical industry for products that need to be kept cold. Their range of services include just-in-time delivery of containers with frozen or cooled gel packs at the proper temperature for shipping. They also manufacture trays to hold fresh fish packed in ice.
A 12-inch cube of his patented material costs less than $5, competitive with the cost of Styrofoam. Jobe has been granted United States patents for his material.
EDITORS NOTE: Vericool was honored with a 2019 #GameChangers Award by Innovation Tri-Valley Leadership Group early last year. Special thanks to Brandon Cardwell and the Economic Development team at the City of Livermore for identifying Darrell and his innovative team as rising stars in the region. Nominate an up and coming TRIVALLEY business you see as a 2020 #GameChanger here https://innovationtrivalley.org/itv-events/gamechangers-2020-nomination-form.