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Image credit: Kate Farms / Benjamin Krebs

Kate Farms nets $51m from Goldman Sachs, others for organic tube-feeding formulas

November 26, 2020

The sentiment that food should be a doctor’s first prescription is gaining popularity in various circles. Maybe they’re disenchanted with modern medicine, or are looking for solutions that can complement pharmaceuticals or surgery.

The Portland, Oregon-based Food as Medicine Institute is now providing educational courses about the connection between our diets and health. A recent AFN guest post even drew thought-provoking parallels between the Covid-19 death toll and obesity.

The increasing demand for plant-based options in medical settings, among both patients and healthcare providers, is not lost on Kate Farms CEO and chairman Brett Matthews – or his company’s investors.

The Santa Barbara, California-based startup recently closed a $51 million Series B round led by Goldman Sachs with participation from Kaiser Permanente Ventures.

“There are millions of patients in the US living with chronic diseases — including those diagnosed with cancer, inflammatory bowel disease, and diabetes — who are experiencing significant intolerance challenges due to the subpar ingredients used in synthetic nutrition available from legacy brands,” Matthews told AFN.

Kate Farms makes plant-based, organic formulas that can be used to nourish individuals with chronic illnesses via tube feeding. It also makes nutrition shakes for regular oral consumption, aimed at people with short-term or milder conditions that do not require tube feeding. The products are devoid of allergens and are US Department of Agriculture-certified organic as well as vegan, gluten-free, and kosher. 

Today, its products are available in over 95% of hospitals in the US, and are covered by Medicare, Medicaid, and over 2,000 private insurance plans. It lists 2020 as its fourth consecutive year of sustained growth, and recently secured a five-year contract with the US Department of Veterans Affairs to make its products available to patients at its medical facilities.

Kate Farms gets its name from its founders’ past experience with tube feeding. A young girl born with cerebral palsy named Kate Laver wasn’t meeting typical developmental milestones, partly because she was unable to tolerate any of the existing tube feeding formulas. Her parents — Kate Farms’ founders Michelle and Richard — set out to create an option using plant-based, high-quality, organic ingredients free from allergens.

“Traditional formulas on the market are typically made with synthetic ingredients and common allergens, which can lead to impaired digestion and intolerance among patients with chronic illnesses,” Matthews explained. 

“Our formulas are designed to help people overcome significantly impaired digestion and are clinically proven to improve weight gain and tolerance, which are critical for patients to receive the treatments they need to heal.”

The startup will use the funding to boost its innovation and expansion efforts. It debuted three new formulas in 2020 including a blend formulated specifically for children and a product to assist individuals struggling with weight loss due to chemotherapy. The third product is a meal replacement shake that can be purchased on the company’s website or through Amazon.

Kate Farms is not only having to navigate pandemic-related challenges to keep its essential product in production; it’s trying to help alleviate some of the pressure, too. It’s donating meals to high-risk communities through organizations like Meals on Wheels America and Partnership with Native Americans. And during the recent US presidential election, it donated 45,000 meals to workers with partners Support+Feed and Frontline Impact Project.

“As our communities face challenges throughout this pandemic, we will continue to fulfill our mission of making plant-based nutrition available for all in need,” Matthews said.

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