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Back to the Roots Raises $2 Million to Grow...

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By: Lora Kolodny
As published in the Wall Street Journal

June 9, 2015, 7:30AM ET — Oakland, Calif. startup Back to the Roots makes “ready to grow” gardens and packaged foods from simple ingredients.backtotheroots.com

A 14-employee startup in Oakland, Calif., Back to the Roots Inc. has raised $2 million in seed funding from big names in food and tech in a bid to become a “Kraft Foods for the next generation,” said co-founder Nikhil Arora.

Back to the Roots makes “ready-to-grow” and “ready-to-eat” products sold in grocery and retail stores including Whole Foods, Home Depot, Target, Nordstrom, Urban Outfitters , Kroger, Safeway, Costco and others.

A philanthropic investment organization, Fund Good Jobs, led Back to the Roots’ seed round, joined by a long list of angel investors including Annie’s Inc. President John Foraker, Clif Bar Chief Executive Kevin Cleary, Living Social co-founder Aaron Battalion, Urban Sitter CEO Jessica Steel, Stonyfield Farm founder Gary Hirshberg, Jamba Juice Co. CEO James White, TOMS Shoes LLC founder Blake Mycoskie and Michael Pollan, food activist and author of The Omnivore’s Dilemma.

Back to the Roots started as a “dorm room” business at University of California at Berkeley when Mr. Arora and Alejandro Velez both took a business and ethics course where they learned that they could grow gourmet-quality mushrooms from used coffee grounds.

After their professor introduced them, they grew their own batch of mushrooms in a bucket full of spent coffee grounds, and took them around to local groceries to try to win a customer. Grocers turned them down.

But they knocked on the door of Chez Panisse, where culinary icon Alice Waters and restaurant chef Cal Peternell approved of their product, Mr. Arora said. With that encouragement, they decided to decline job offers they had received in finance and consulting, and to start a small business after graduation, growing and selling mushrooms.

Today, the company makes an “organic mushroom farm” in a box, “garden in a can” products that sprout herbs, and cereals from organic stone-ground wheat.

Jamba Juice CEO Mr. White, who isn’t historically an angel investor, said he was impressed by Back to the Roots’ product design initially. He decided to back the company when he saw how far the entrepreneurs had been able to grow their business “from scratch, as non-foodie co-founders.”

Read the full article about Back to the Roots’ funding, including more about the company’s mission and future plans, at Dow Jones VentureWire.

Write to Lora Kolodny at lora.kolodny@wsj.com. Follow her on Twitter at @lorakolodny

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