As news about Silicon Valley Bank (SVB) rippled through the exhibition halls at Expo West on Friday, the team at AFN walked the show floor to catch up with key players in food tech, from Climax Foods, showcasing the next generation of plant-based cheese, to Eat Just, which is taking “critical steps towards profitability.”
Climax Foods deploys data-driven approach to create the next generation of plant-based cheese
“Right now, a lot of plant-based products are no better than animal products, and in some cases, they are actually worse,” claimed Dr. Oliver Zahn, founder and CEO at Climax Foods, a data-driven startup reverse engineering animal foods and rebuilding them with plants.
“We’re offering the first zero compromise product that is actually better than dairy cheese in every way on taste, texture, nutrition, and price, which is why we have multiple multibillion-dollar dairy companies competing to work with us.”
His first products—plant-based brie, blue cheese, feta, and chevre—deliver complex flavors, creamy textures, and protein levels that match dairy cheese, said Zahn, who has raised $27 million to support his AI-powered startup.
“Things are just building up at our new Petaluma plant, so we’re starting with a small-scale launch in restaurants with Michelin-starred chefs, but hopefully by the end of the year we’ll also have a retail presence.”
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Eat Just: Taking ‘critical steps to profitability’
Eat Just, which has just laid off 18% of staff at its Just Egg plant-based egg business, has “been on a journey since we launched to reduce our costs,” chief revenue officer Matt Riley told AFN.
“The macro economy has forced us to make more radical adjustments in headcount this year, not unlike a lot of companies.”
While Eat Just is “not immune to inflationary pressures” and “had to take some price increases in the market, it was nothing near what other manufacturers in the space have taken,” claimed Riley.
“And if you look over the past four years, our protein prices are significantly lower than they were. But we continue to focus on cost reduction, including headcount and our conversion costs around protein manufacture. Those are all critical steps to profitability.”
As for the company’s GOOD Meat cultivated meat business, which is run separately, Riley said Eat Just founder and CEO Josh Tetrick “continues to raise money” to fund 250,000-liter bioreactors, a scale significantly larger than other players in the segment are contemplating.
However, Eat Just already has a small-scale plant in Alameda, California, from which it could mount a small-scale launch in the US market, he said: “We certainly hope we would have approval to commercialize GOOD Meat in the US this year.
“It would be similar to what we did in Singapore with some high-profile partners in the foodservice space where we build out the business proof of concept and build up consumer excitement and familiarity with the product before we scale up.”
Consumer communications director Carrie Kabat added: “We’re working on improving our profitability overall. But on Just Egg, we’ve seen some of our highest retail velocities ever this year, as with [chicken] eggs so expensive, people are looking for alternatives, so it’s been a great time for trial, and we’re actually in about 2.1 million households right now.”
NotCo: NotMilk going shelf-stable in the US, NotCheese co-branded product with KraftHeinz off to promising start
NotCheese, the first product to emerge from the joint venture between KraftHeinz and Santiago-based foodtech company NotCo, is off to a promising start in the US, VP sales US Katherine Connelly told AFN at the show.
“It’s doing extremely well, better than expected. I’m not going to share exact numbers, but the test has been a huge success.”
NotCo—which deploys a proprietary artificial intelligence (AI) platform called ‘Giuseppe’ to bring a new level of sophistication to the formulation of meat and dairy alternatives—has raised $420m since it was founded in 2015. It introduced plant-based products to multiple countries in Latin America before entering the US market in 2020 with plant-based NotMilk, which it has recently switched to UHT packaging, said Connelly.
“We’re going completely shelf-stable.”
She added: “The NotChicken chicken patties have been really really good for us in the first few months of being on shelf, and we’ve got tenders coming out this spring.”
Mwah! Gears up for launch under new owner Next Gen Foods
Singapore-based startup Next Gen Foods—which recently took full ownership of London-based dairy free brand Mwah!—is targeting the UK, Germany, and the US for Mwah! and its TiNDLE plant-based chicken products.
Next Gen—which announced a jaw-dropping $100 million series A round last year—first invested in Mwah! in 2021, cofounder Andre Menezes told AFN. “Instead of going out and trying to raise external funds or us just coming in again and investing more, we welcomed them into our system.”
He added: “Mwah! will launch this month in London at Floozie Cookies in Covent Garden and WAVE plant-based cafés, and then we’ll ramp up gradually. From our point of view, existing plant-based ice creams haven’t been able to get the texture right in terms of creaminess and a clean taste with no aftertaste, whereas Mwah! we feel, has been able to crack this over the past few years with a very short list of ingredients and way fewer calories.”
For TiNDLE plant-based chicken, which is manufactured in the Netherlands, “This year is all about expanding into supermarkets for us,” he said. “We rolled out in Edeka stores in Germany and we’re ready to go in US retail, where retailers are still positive about frozen plant-based chicken. We’re targeting three hotspots in California, New York, and Chicago.”
VFC: ‘We’re seeing a bit of a market correction in meat alternatives’
It’s early days in the US for UK-based alt meat startup VFC (Vegan Fried Chicken), general manager North America Craig Bowlin told AFN. “But our rate of sale continues to climb.
“As more players have entered the market, retailers are evaluating who deserves to be on shelf and who doesn’t, so what we’re seeing now is a bit of a market correction as they figure out who can really stand out and drive the category.
“For us, the mission behind the brand is key—we’re trying to end factory farming, and that is a big part of our personality. But what’s really standing out to buyers is the product; our crispy coating is different than anything in the market.”
Seth Goldman: ‘There’s a bit of a shakeout going on… and that’s a healthy thing’
Natural products industry veteran Seth Goldman told us he was seeing solid traction for his new Just Ice Tea range, launched in the wake of Coca-Cola’s decision to discontinue Honest Tea, the brand Goldman co-founded in the late ‘90s and later sold to Coca-Cola.
“My guess, certainly by mid-summer, is that we’ll be in about 5,000 stores, which is not bad considering we’ve only been on the market a few months,” he told AFN. “The legacy of Honest Tea is that we built that market and proved there’s an appetite for less sweet organic tea. We’re seeing decent repeat rates in the most developed retailers.”
While Goldman stepped down as executive chairman at Beyond Meat in early 2020, he is still closely following the meat alternatives market and remains on the board.
He told AFN: “There was a huge proliferation of brands and there’s a little bit of a shakeout going on and I think that’s a healthy thing. But I still think there’s a lot of opportunity. There are not going to be as many players, and retailers are still working out [how best to merchandise plant-based meat alternatives], and I think brands do matter in this market. Until these categories settle out, we’re going to continue to see people trying new things.”
Wicked Kitchen: Plant-based with a distinct culinary vibe
Culinary-inspired plant-based brand Wicked Kitchen—brainchild of chefs and brothers Chad and Derek Sarno—is now in more than 8,000 doors in the US, with a range spanning 42 products, Chad Sarno told AFN.
“We started off with a lot of [Wicked-branded] ingredients [meat analogs, pesto etc], which are resonating with foodservice customers, but what’s really taking off in retail are our convenience foods, our frozen meals, pizzas and ice creams and noodle bowls. There have been challenges around plant-based meats, but our product range is very diversified.”