Since Beyond Meat took the IPO plunge in May 2019, a slow but steady trickle of alt-protein startups have followed suit and gone public.
Oregon’s Laird Superfood — which makes plant-based coffee creamers and other health-oriented sundries — listed on the NYSE American in September at a valuation of $184 million.
A few hours north of the border, Vancouver’s Modern Meat had gone public on the Canadian Securities Exchange (CSE) in July. It makes a variety of meat alternatives from pea protein, chickpea, mushrooms, and brown rice.
A month earlier, The Very Good Food Company — another plant-based ‘butcher’ from just across the water in Victoria — began trading its shares on the CSE, raising C$4 million ($3.08 million.) It recently announced its shares will also begin trading over-the-counter in the US.
Given the growing interest in the plant-based boom it might not come as too much of a surprise that it isn’t only alt-protein manufacturers themselves, but the funds that invest in them, that are looking to tap into the public capital markets.
Last week, Eat Beyond Global — a Vancouver-based fund that has backed multiple alt-protein startups in North America and farther afield — began trading on the CSE.
Since launching in February, Eat Beyond has invested in The Very Good Food Company as well as:
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- Eat Just (US) – plant-based egg substitute
- Good Natured (Canada) – plant-based materials and packaging to replace plastics in foodservice and other industries
- GreenSpace Brands (Canada) – develops and markets premium ‘natural’ food products
- Nabati Foods (Canada) – vegan cheese, chocolate, and desserts
- SingCell (Singapore) – contract development and manufacturing platform for cell-based meat
- TurtleTree Labs (Singapore) – cell-based human breast milk
The fund has also been padding out its leadership team. It recently elevated former Mars Canada CEO Don Robinson to chairman of its board of directors, and this week appointed Michael Owen — a former marketing executive with Mars, Nestlé, and Unilever — to its investment committee.
SingCell is a graduate of Singapore Food Bowl, the food security-focused program run by AgFunder‘s impact fund and accelerator GROW. Find out more here
AFN spoke to Eat Beyond CEO Patrick Morris to find out why the investment fund decided to go down the IPO route – and what it has planned for the future.
AFN: How much does Eat Beyond expect to raise and how does this measure against comparable IPOs in Canada and globally?
Patrick Morris: Our goal is to grow by 10x. That’s $3.5 million to $35 million in the next 12 months. However, there are many variables at play in this kind of situation, including the share price at the time of financing and the appetite in the market. The plant-based food sector has been gaining a lot of interest, which is exciting for us as well as for the planet. Being a part of a truly sustainable and health-driven industry and helping it thrive is incredibly rewarding.
Are there similar vehicles or models to Eat Beyond’s in other markets that you’re aware of?
There are several private equity firms in the food space, but none that we know of that are publicly traded funds. We wanted to make it easy to invest in the future of food, so we are making it possible for retail investors to participate in this thriving market with a truly global and diverse portfolio that is accessible on a public exchange. It’s also extremely important to us to provide more than capital to our portfolio companies by taking a hands-on approach and working closely with them to support their growth.
Where did the idea for this publicly traded fund model come from?
We are at a pivotal point in human history and an increasing number of people are becoming aware of the impact that our food choices are having on both our health and the environment. It’s become clear that something needs to change for all of us. This has also become apparent in the investor community with more investment dollars moving into this sector and more startups tackling these challenges every year.
Food is something that impacts us all, so we wanted to make it easier to participate in this growth by creating an opportunity in the retail market for investors seeking a broad cross-section of companies that are diverse both in what they do, but also in where they are located.
How much demand did you gauge for this kind of vehicle prior to the IPO from Canadian retail investors?
Once we announced our launch earlier this year, we received enormous interest from all over the world, from both the media and the investment community. The demand for plant-based and innovative food investments is incredibly apparent, particularly when you look at the success of companies such as Beyond Meat.
Would you say that Eat Beyond adopts a typical VC-type strategy for investing in foodtech startups?
Our approach is very hands-on and we are very selective. Once we get involved, Eat Beyond and the entire team are involved to provide support and remove obstacles for our entrepreneurs. We are able to do this because of the incredible talent and experience on our investment committee and our robust network.
What types of foodtech startups do you invest in?
We are open to a very wide variety of companies. Some areas we are looking at are plant-based proteins, fermented proteins, cultured proteins and cultured agriculture, foodtech, and consumer packaged goods, as well as cell agriculture and other experimental projects. There are no defined ‘no-go’ types of projects – it really comes down to what our team believes makes sense, has the right team, and has big potential.
How many companies does Eat Beyond expect to invest in over the next few years?
Approximately 10 to 12 per year.
Does Eat Beyond plan to wholly acquire some or all of the startups in its portfolio farther down the road?
While this is not explicitly a part of the plan, we wouldn’t rule it out down the road.
Some of your portfolio companies are already publicly traded. What if startups in your portfolio decide to pursue their own IPOs? How might that impact Eat Beyond’s holdings?
That would be a very positive thing and would be advantageous to us. Not only is it likely to provide our portfolio [companies] with additional access to capital to grow, but it also would provide liquidity for our investment, which enables us to be more flexible.
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