PeakBridge co-founders Erich Sieber and Nadav Berger. Image credit: PeakBridge

BREAKING: PeakBridge Growth Fund II holds first close on €100m, makes first 2 investments

September 14, 2022

Agrifoodtech investment manager PeakBridge VC has completed the first close in its PeakBridge Growth II fund in partnership with Edmond de Rothschild Private Equity. The fund will start to deploy its first €100 million ($100 million), beginning with two investments in alternative protein technologies: Netherlands-based Rival Foods and France’s Standing Ovation.

On background:

The PeakBridge Growth II fund, first announced at the end of 2021, invests in Series A- and B-stage agrifoodtech companies in five specific sectors: ingredients innovation, alternative protein technologies, digitization and food systems 4.0, nutrition and health, and alternative farming systems.

  • The fund is a joint effort between PeakBridge and the private equity investment arm of family-owned investment firm Edmond de Rothschild Group.
  • It will target €250 million ($249 million) in assets under management with the possibility of further growth in the future.
  • Financial terms for the Rival Foods and Standing Ovation deals were not disclosed; PeakBridge and Edmond de Rothschild Group have said they will invest  roughly $5 million to $8 million per company through the fund.
  • PeakBridge is also a core member of EU-backed consortium EIT Food, and manages the EIT FoodSparks seed fund.
  • As of the end of 2021, Edmond de Rothschild had nearly CHF 178 billion ($185 billion) in assets under management, 2,500 employees and 29 locations worldwide.
  • The fund will disclose a third investment in mid-October for a cultivated meat company.

Meet the startups:

Rival Foods, which spun out of Wageningen University & Research, develops whole-cut plant-based meat analogues. The company has developed its own technologies, equipment, processes and product formulations to recreate the texture and mouthfeel of real meat in plant-based alternatives. Its products are made with just a handful of “clean label” ingredients including wheat, soy, and pea protein as well as plant-based seasonings.

France-based Roquette Ventures, which invests heavily in food, nutrition and health startups, joined PeakBridge for the Rival Foods investment. 

Standing Ovation produces dairy proteins via microbial fermentation to make lactose- and animal-free substitutes for dairy and egg products. In particular, the company focuses on caseins, which are notoriously tricky to manufacture without actual cows involved.

The company just announced a $12 million Series A raise that includes the PeakBridge investment.

Why it matters:

By many accounts, taste and nutrition are the next great frontiers in plant-based proteins. One survey, from taste and nutrition company Kerry Group, found that 76% of consumers in the UK will buy a plant-based burger described as “authentic chargrilled-tasting” and 80% of US consumers would buy a plant-based burger that is “rich and savory.”

Extrudable fat and prolamin technologies as well as fermentation methods, amongst many others, are helping companies improve plant-based proteins’ characteristics so that they mimic the taste, mouthfeel, bite and melt of the real thing more accurately.

Whether technology will ever be able to fully replicate animal-based proteins with plants remains up for debate, but that hasn’t stopped investors from pouring plenty of capital into the sector. Alternative proteins drove the bulk of the $4.1 billion invested into the Innovative Foods category in 2021, according to AgFunder data.

PeakBridge and Edmond de Rothschild Private Equity’s fund comes at a time when many are focused on next-generation developments in plant-based proteins, such as producing whole cuts of “meat” and developing alternatives of the aforementioned Casein at scale.

What they’re saying:

“Our food diet is standardized, and neither healthy nor sustainable,” Nadav Berger, general partner and co-founder of PeakBridge, said in a statement. “Much of our food comes from a small number of over-processed ingredients which are harmful for both biodiversity and our health. Solutions and technologies that explore alternatives to animal-based protein without compromising on taste, texture, nutrition and climate impact are becoming increasingly significant.”

Johnny El Hachem, CEO of Edmond de Rothschild Private Equity, added: “This fundraising success confirms our conviction that the Agri-FoodTech asset class has significant growth potential and demonstrates investor interest in this theme.”

 

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