August 13, 2019

By Lynda Kiernan

Demand for plant-based protein continues to rise. Shipments of plant-based products to food service distributors to retailers and operators increased by 20 percent  in the twelve months ending November 2018, compared to the previous year, according to the NPD Group.

Today, a full 25 percent of U.S. consumers say they eat and drink plant-based foods for a variety of reasons, ranging from dietary and health reasons, to concerns over animal welfare and the environment. 

“Plant-based proteins are no longer just a meat replacement, it’s now its own category,” David Portalatin, food industry advisor to NPD, and author of “Eating Patterns in America”, told Convenience Store News. “It’s possible that protein overall is evolving into a category, whether animal meat, beans, nuts, soy, wild game or other proteins, in forms ranging from beverage to center-of-plate.”

This climbing demand also translates to more successful funding rounds and strategic partnerships. 

Emergy Foods

Plant-based protein startup Emergy Foods announced it has raised $4.8 million in venture funding led by Congruent Ventures, and including Prelude Ventures, Better Ventures, 50 years, New Crop Capital, The March Fund I LP, Trust Ventures, and Bluestein & Associates among others.

Additional previous funding totaling $1.3 million was raised by the company through grants from the National Science Foundation, the Department of Energy’s Argonne National Laboratory, and Chain Reaction Innovation.

Having just moved its headquarters to Boulder, Colorado, Emergy Foods produces an (as yet undisclosed) new, sustainable proprietary plant-based ingredient that can be used to make plant-based meat alternatives that have the texture of whole muscle meat.

“I don’t think there’s anything on the market right now that can match the textural qualities of a whole muscle meat,” Tyler Huggins, CEO Emergy Foods, told NOSH. “We’re looking at different white spaces that we believe are untouched in the market right now, and we’ll be coming out with a variety of different products.”

The company plans to use the funds to expand its team to include more food industry leaders, to increase its production capacity, and to expand its production facility in Boulder where the company has production lines, a laboratory, and kitchen facilities that can be scaled up as the company grows.

Although the company will not reveal its ingredient as of yet, Higgins told NOSH that it has the same amino profile of milk and eggs and the same fiber content as vegetables. It is soy-free, wheat-free, and pea-free, and is able to produce 2,000 times the protein per acre compared to traditional agricultural production. 

“There’s no limit in the future of how much of our ingredients and our products we can make,” said Higgins “We see the limitation in supply around pea protein– that keeps the price really high. And where are we going to grow all of this stuff? We’ve already used up most of our land. So we’ve developed this solution that bypasses that. We want to make sure this technology is shared with everybody.”

Marfrig and ADM

Global giants are also maneuvering to gain market share. Brazil’s Marfrig and Archer Daniels Midland (ADM) announced a strategic partnership for the production of plant-based protein in Brazil. 

Under the terms of the deal, ADM will provide the raw materials, which Marfrig will then process at its location in Várzea Grande, Mato Grosso, then distribute and sell to food service and retail customers.

The first plant-based burgers made through this tie-up, which will be launched under a specific brand created by Marfrig, are expected to reach the market in Brazil by the end of this year, with exporting to other markets to follow. 

“Together, Marfrig and ADM will produce 100 percent vegetable protein-based burgers with the same taste and texture of beef,” said Eduardo Miron, CEO of Marfrig Global Foods. “We want to give consumers the power of choice. They are the ones who decide. The plant-based burgers will complement Marfrig’s product portfolio and be distributed through all our market channels.”

NUGGS

“Chicken” nugget startup NUGGS has announced its launch with $7 million in funding led by McCain Foods, along with Rainfall Ventures; Greylock Discovery Fund; Maven Ventures; NOMO Ventures; M Ventures; ACME Capital; Bob Pittman, founder of MTV and CEO of iHeartMedia; Casper founder & COO, Neil Parikh; and former president of Tumblr, John Maloney, 

Founded by 19-year old tech entrepreneur, Ben Pasternak, NUGGS maintains that it will be an industry disruptor, with a product that is a more advanced version of animal-based nuggets. Using advanced texturized pea protein technology, NUGGS have superior texture, taste, and consistency, and are free of wheat, eggs, soy, and dairy, while having 22 grams of protein per serving at only 180 calories. 

Pasternak was the youngest person ever to raise venture capital from Silicon Valley, at age 15, and he plans to approach product development much like an app, by taking user feedback to drive product updates as the formula improves.

“At McCain we believe NUGGS has developed an incredible product that uses plant-based technology to uniquely simulate a high quality chicken nugget,” said Mauro Pennella, Chief Growth Officer at McCain Foods.

“A significant factor in achieving this is their approach to fast and iterative innovation, which is based on constant consumer feedback. We believe the combination of the NUGGS approach and McCain’s production and commercial expertise will accelerate the brand’s growth and deliver market scale.”

– Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.com.