A big snack company called Mondelēz International is taking a risk by investing in a healthier bakery called Urban Legend in the UK. Mondelēz is making this smart choice as part of a larger plan to grow its business in cakes and pastries, an area where it has already been slowly growing.
Mondelēz bought a small part of Urban Legend through its venture capital arm, SnackFutures Ventures. Urban Legend is a fast-growing business known for developing new ways to lower sugar, fat, and calories in its goods.
There are no details about the deal’s financials yet, but the investment fits Mondelēz’s long-term plan to offer healthy snack options and become a star in the fresh bakery market.
One of the best things about Urban Legend is their special air-frying technology, which makes their donuts healthier than regular ones. Urban Legend is making news in a market that isn’t usually linked with healthy options by cutting sugar, fat, and calories by up to 75%.
The Story Behind How Popular Urban Legend Is
Urban Legend isn’t like other doughnut shops. It comes up with new ways to use air fry technology to make doughnuts that are lower in fat and calories without sacrificing taste.
Because of this, the business stands out in the food industry, where sweet treats like donuts are often seen as bad for you. Urban Legend’s doughnuts have 200 calories or less, making them a good choice for people who want to treat themselves but still do something good for them.
About a year ago, SnackFutures Ventures, a funding arm of Mondelēz International, first heard about Urban Legend. The global head of SnackFutures Ventures, Richie Gray, said the brand was an easy choice to invest in because it fit with Mondelēz’s business goals.
Gray said Urban Legend was an exciting chance for the company because it had the ability to change the snacking business and had unique technology.
A Natural Fit for Mondelēz’s Bakery Growth
Mondelz has long been a big name in the snack food business, with well-known brands like Oreo, Ritz, Clif, and Tate’s. But in the past few years, the company has said it wants to offer more than just crackers, cookies, and bars. They want to offer cakes and sweets as well.
By putting money into Urban Legend, Mondelēz takes a big step toward this goal, especially in an area it hasn’t looked into before doughnuts.
With its unique value offering, Urban Legend perfectly fits Mondelēz’s goal of making healthier food. Doughnuts are usually considered unhealthy and high in calories. Still, Urban Legend’s use of air-frying technology to reduce dangerous ingredients has made the brand stand out.
This investment helps Mondelēz get into the doughnut business and shows that the company is still committed to making healthy snack choices.
How SnackFutures Fits Into Mondelēz’s Plan
Mondelēz created SnackFutures in 2018 to strengthen its place in the food market by putting money into new brands and technologies. At first, SnackFutures worked on making its brands. But in 2023, the company changed its plan to only invest in well-known brands and new businesses.
With this change, Mondelēz can enter or improve its position in markets that are growing quickly. It can also use cutting-edge technologies or strategies for these markets that it can then use for its other brands.
Ever since its creation, SnackFutures has been focused on finding exciting new businesses that fit with Mondelēz’s bigger plans.
The name Urban Legend is one of these. Gray said that the company has spent much of the last year learning about Urban Legend’s business plan and thinking about how the two could work together.
SnackFutures’ business plan is to buy small pieces of smaller companies and help them grow with Mondelēz’s help. Mondelēz can try out new names with this approach, and if they do well, they might buy them. Mondelēz hasn’t said if it wants to buy Urban Legend, but based on how the company has behaved, this seems like a chance if it keeps growing.
What the Future Holds for Urban Legend in the Better-For-You Bakery Space
At the moment, Urban Legend is best known for its doughnuts, but the company has bigger plans. Already, it has started selling other baked goods, like cinnamon rolls, and it plans to keep adding new items to its line. And now that Mondelēz is behind Urban Legend, it could become a big name in the healthy baking market.
Urban Legend’s goods are already sold in almost 200 shops in the UK. They are shown off in separate baking cabinets. Because the company is growing, it will likely attract customers who want tasty treats without the guilt of eating high-calorie sweets.
Mondelēz’s Bigger Plan for Cakes and Pastries
Mondelēz’s investment in Urban Legend is part of a bigger plan to make the cakes and sweets business bigger. Mondelēz has bought several companies in this area over the past few years. The company bought Give & Go in 2020.
Give & Go is an American company that makes brownies, cupcakes, and other baked goods. After a year, it bought Chipita, a company in Central and Eastern Europe that made croissants and other baked goods.
Recently, Mondelēz bought a large majority stake in Evirth, a big Chinese company that makes cakes and pastries. With these purchases and the investment in Urban Legend, Mondelēz is determined to become a world leader in cakes and desserts.
Conclusion
Mondelēz’s investment in Urban Legend is a smart business move that sets the company up for success in the market for healthier baked goods. Mondelēz is growing its product line and appealing to health-conscious customers by teaming up with a brand that uses cutting-edge technology to make better treats of the unhealthy ones.
The investment also allows Mondelēz to study how Urban Legend does things and possibly use similar methods for its other global brands.
As Urban Legend grows, it could become a big player in the food industry, giving people a new way to think about making unhealthy snacks that are still tasty. That is another step for Mondelēz toward becoming a market leader in healthier snacks.
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