Ever since the dawn of the European startup ecosystems, now about 15 years ago, a recurring topic of discussion has been around verticals, sectors, and specializations. How do various countries and regions compare and compete? In the race for the next scalable business success stories and venture homeruns, it’s logical for ecosystems to form around specific concentrations of skill and know-how. Classically, these communities develop around research centers. The electronics development and manufacturing labs are the ones who gave start to the two most powerful tech and venture ecosystems in the US (and the world), San Francisco’s Silicon Valley and the Greater Boston Area. Those two cities are by no means the biggest or most powerful cities in the country, they’re not even in the top 10 by population, but they’ve managed to hold and grow their industry positions for almost 70 years straight now, even as much bigger urban areas like New York and Los Angeles have become venture industry hotspots in their own right.
Here in Bulgaria, we’ve had our own growth with our skill verticals. Due to the historically strong focus on STEM competences in high schools, and the surge of engineering jobs in the socialist era, Bulgaria has entered the digital age well-equipped with abundant computer science skills, which have translated into a big part of the tech community’s emergence and prominence. But when we look at the economy as a whole, the sectors of agriculture and hospitality still by far outnumber digital services and engineering. Surely they could also translate into venture opportunities?
That has been our thinking from the very beginning at Vitosha, and despite the fact that both the availability of dealflow, and the return-on-equity profile of food-related companies and innovations are more limited than is the case with classical (business) software, we’ve still always approached food innovation opportunities with great interest. This interest led us to invest into companies like VGAN, BrainFoods, FoxCrop, and HealthMe, and culminated last year in Vitosha being the co-organizer and investment partner of the Future Verticals acceleration program for food-related innovations.
Today, we’re taking a closer look at one of the Future Verticals graduates that Vitosha invested in recently, the energy drink startup LIXR. Founded by the amicable duo of Hristo Vatashki and Ventsislav Chanov, the company has developed an organic energy drink, which is getting ready to hit the shelves of gas stations, supermarkets, and convenience stores this spring.
Hristo and Ventstislav are no strangers to fast-moving consumer goods (FMCG). As the founder and owner of multiple food distribution businesses, Hristo has spent his entire life in the sector, most recently as the man behind the Gourmoli brand of organic Bulgarian walnut oil, and the managing partner of one of Bulgaria’s leading vending machine businesses. With Gourmoli enjoying a growing foothold in Western Europe, and the vending machine business gaining prominence in key locations in our country’s shopping centers and office parks, Hristo felt he was ready to give an old idea another chance.
Ventsislav too is acquainted with the sector. Well-known in Bulgaria under his artistic name Venci Venc’, he has emerged as one of the leading hip hop musicians in the country. Next to music, he has built up a portfolio of business interests, particularly in the distribution of Gen-Z-oriented foreign energy drink brands and other consumer items. A few years ago, shortly before the onset of the Covid-19 pandemic, Hristo and Ventsislav came up with the idea to develop and manufacture their own energy drink, locally made, with an optimally strong brand message, and with the highest possible degree of natural and organic ingredients. Jokingly, they gave it the project name “Elixir”.
Fast forward to 2020, and the Elixir project got sidelined by the lockdowns, as Hristo and Ventsislav had to focus their energy on keeping the lights on in their other work projects. But as the pandemic subsided, they decided to get serious about the new company. Rebranded as LIXR, the duo started working together with a food lab to mix various proportions of the ingredients, and in 2023, they joined the Future Verticals program, to accelerate the early prototypes of the product and packaging towards a minimum viable product that’s ready to go into serial production.
As we sit down to check the latest packaging designs with Hristo and Ventsislav, the founders are very clear about what LIXR is all about. “We have developed an energy drink recipe with a focus on maintaining the best possible taste, with the highest possible volume of natural ingredients”, says Hristo. The food-chemistry challenge is to dissolve as much as possible of the guarana extract that provides natural caffeine and sugar, with as little additives as possible, while not impacting the taste qualities. “And then there is the packaging and brand communication”, adds Ventisislav. “In the past 10 years, I have seen what works and what doesn’t when you’re selling to a young and dynamic demographic. We want to compete with the top global brands, first locally, and then abroad in Europe and beyond, with a product that connects and is honest about its ingredients, its story, and its pricing”.
Finalizing a follow-on investment round this month, the LIXR team is busy planning the launch of the first series of LIXR servings in several test locations, well ahead of the 2024 summer season. Keep an eye out for the quirky yellow cans next time you visit a convenience store or a gas station in the coming months. It might just be that you’ll discover your new favorite drink.