Consumer interest in plant-based foods continues to grow, and investors are taking note. The global plant-based market is projected to reach over $20 billion by 2030, up from $7 billion in 2020, and new startups are emerging every week to capture this demand.
“I think [the plant-based trend] is here to stay, and the more people get educated on the space, the larger it will get,” Sean Dollinger, founder of plant-based ecommerce platform PlantX, told PYMNTS in an interview. “I think COVID had a huge part in this. I find people want to take better care of themselves, seeing what can take place at any time… I think [plant-based] will be the new way people shop.”
In the last month alone, many new companies have come to the fore raising funds by the millions, tens of millions or hundreds of millions to power their growth.
Take for instance Simulate, a company that announced Tuesday (June 8) that it had raised $50 million in Series B funding for its plant-based meat substitutes. The company, which created Nuggs, a chicken nugget substitute available at many top grocery chains, said it will use the fundraise to grow its workforce three-fold, develop new products and processes, increase the its manufacturing capabilities, place products in new stores and restaurants and to grow into global markets.
“Historically our food system has rejected the use of technology, resulting in a system that is highly inefficient and primitive,” Ben Pasternak, the company’s (21-year-old) co-founder and chief executive officer, said in a statement. “This new funding will be used to create and protect the intersection of technology and nutrition.”
Float Foods, a Singapore food tech company that makes plant-based egg substitutes, announced a $1.6 million seed funding round Tuesday. Also in the past month, plant-based chicken creator Daring announced a $40 million Series B funding round (including an investment by musical artist Drake); plant-based fast food chain Plant Power Fast Food announced a $7.5 million Series A fundraise; Shanghai plant-based protein company YouKuai Group International announced $7.3 million in Series A funding; German pea milk maker Vly announced a $7.4 million Series A funding round; and plant-based bacon brand Hooray Foods announced $2 million in seed funding, among others.
A recent survey of vegans finds that the number one factor motivating people to go plant-based is concern for animal welfare. Accordingly, it is not just plant-based foods that can capture the demand for protein options that do not harm animals. Good Meat, a subsidiary of food technology company Eat Just, Inc. that creates meat cultured from animal cells, announced a $170 million fundraise.
Kevin Russell, chief investment officer at Good Meat investor UBS O’Connor, said in a statement, “The $2 trillion global market for meat and poultry is likely to experience significant change and disruption over the next 10 years as consumers increasingly recognize the environmental impact of their diet choices and search for healthier and more sustainable products … to replace conventional animal proteins in their diets.”