Blue Buffalo, the fastest-growing pet food company in the U.S., has re-defined pet food. But not only is Blue Buffalo providing healthier options for pets, it's also offering a healthier option for investors.
Founded by Bill Bishop his sons, Billy and Chris in 2002, Blue Buffalo has quickly become top dog when it comes to the pet food industry.
Rival to the company are larger conglomerate pet food brands Purina, owned by Nestle, Pedigree Petfoods, part of Mars and Meow Mix of Del Monte Foods.
Blue Buffalo's motto - "Love them like family. Feed them like family."
According to CNN, Blue Buffalo is capitalizing on the "humanization" of pets, especially as pet owners are becoming health-conscious too. Since Americans treat their cats and dogs more and more like an extension of their family, pet owners or pet parents, are increasingly willing to pay premium price for top pet products.
Blue Buffalo reportedly makes use of real chicken, lamb and fish in their products, as opposed to poultry by-products, corn, wheat, artificial preservatives or colors.
From $190 million in 2010, Blue Buffalo sales have exploded to $918 million in 2014, according to CNN.
Because of this, Blue Buffalo has raised $676 million this week after selling shares to the public and has become the fastest-growing pet food company in the U.S.
Late Tuesday, Blue Buffalo offered 33.8 million shares at 20 each and all proceeds will go to current investors, according to Investors.com.
The growth is a feat in the industry as the overall market is reportedly sluggish. The company's shares Wednesday morning opened at $27 on the Nasdaq, marking a healthy 35% bump from IPO price. The dog and cat food maker is now valued at $5.3 billion.
In 2015, it is expected that Americans would spend nearly $61 billion on pet products, more than a third of which is on food, according to American Pet Products Association.
"As baby boomers retire they have pets and money to spend and margins in pet businesses are generally high," according to the founder of IPO investment firm, IPOX Schuster LLC, Josef Schuster.
Blue Buffalo now has 6 percent of the shares in the U.S. pet-food market, amazingly holding about two-thirds of the market globally, reported Reuters.
