PowerPlant Ventures partner: ‘The plant-based milk market didn’t take off until they solved the taste issue; the same applies to plant-based meat’

By Elaine Watson

- Last updated on GMT

The PowerPlant Ventures team (L-R): TK Pillan, Dan Gluck, Mark Rampolla and Kevin Boylan. (Picture: PowerPlant Ventures)
The PowerPlant Ventures team (L-R): TK Pillan, Dan Gluck, Mark Rampolla and Kevin Boylan. (Picture: PowerPlant Ventures)

Related tags PowerPlant Ventures plant-based meat Plant-based foods

Insect protein remains frustratingly niche, and cell-cultured meat – while groundbreaking - could be a tough sell. But plant-based meat is something mainstream consumers can understand and embrace, provided products truly deliver on taste and price, argues a co-founder of PowerPlant Ventures.

Speaking to FoodNavigator-USA after the plant-centric venture fund​ – an early investor in Beyond Meat - closed a $165m fund (four times the size of its original fund), partner and co-founder Kevin Boylan said next generation products had changed the game, and the total addressable market, for plant-based meat.

The plant-based milk market didn’t take off until they solved the taste issue​ [and products moved into fridges alongside fresh milk]; the same applies to plant-based meat,"​ claimed Boylan.

"When we started at Veggie Grill​[a plant-based restaurant chain which he co-founded with TK Pillan] meat alternatives were these awful TVP products or things that were like dropping a bomb in your stomach, but today they are completely different.

The largest food and beverage company in the world ​[Nestlē] is making plant-based a #1 priority for the future.​ That’s very telling and I think it’s going to define the market for the next couple of decades. Right now, we’re at the very beginning, the very early innings of this re-architecting of our food system.”

Who eats at Veggie Grill?

While the plant-based meat market is currently a fraction of the size of the regular meat market, despite all the hype, there has been a shift not just in the quality of the products, but the messaging – which is about taste and inclusivity, not preaching at people or narrowly targeting certain groups, he said.

In the last 90 days we’ve had 1.6 or 1.7 million guests at Veggie Grill, so we have a lot of data and I’m also constantly talking to our guests even though I don’t run the company anymore because it gives me insights into who’s coming, why they are there, what food tribes they belong to.

“And more and more, they are not part of any ‘food tribe.’ I hear it again and again, they just say I’m looking to reduce my intake and my family’s intake of meat and dairy. I also see it in people that I know and love, dyed in the wool carnivores that love the taste and smell and mouthfeel of meat.”

Powerplant-Ventures team

PowerPlant Ventures​ - a venture fund led by Mark Rampolla (founder, ZICO), Kevin Boylan, T.K. Pillan (co-founders, Veggie Grill) and Dan Gluck (cofounder, Health Warrior) – has raised $165m in its second fund, significantly exceeding its original $100m target.

To date, it has invested in firms including Beyond Meat, Apeel Sciences​,​ JUST Inc, Farmer’s Fridge,​ Beanfields, Thrive Market, Ripple Foods​,​ Rebbl, Oh My Green, Square Roots, Veggie Grill, Nutriati​,​ Your Super, and Vive Organic.

What does 'plant-based eating' mean?

But given that it’s perfectly possible to eat a plant-based diet without eating ‘faux’ meat or dairy at all, and many companies are slapping ‘plant-based’ labels on junk food that just happens to be vegan to cash in on a trend, do we need to re-think what ‘plant-based’ means?

Asked whether from a culinary and a health perspective, he would like to see more attention and investment directed towards helping people shift towards a healthier dietary pattern with more fruits, vegetables, nuts and grains, rather than what might seem like a myopic focus on meat and dairy analogs, Boylan said:

Quonia power salad
Veggie Grill's quinoa power salad

“At Veggie Grill we spent an enormous amount of time thinking about this. We all know that a whole food plant-based diet is the ideal, and if you go there you can get an amazing quinoa power salad​ [quinoa bowl with fresh veggies, cannellini beans, hemp seeds almonds, currants, and avocado], and we tried to make those menu items as appealing as possible.

But we knew that if we were going to entice the American consumer that is just used to having meat at the center of the plate, we also needed to make dishes that are familiar in form and texture and flavor and smell to what they are used to, so we had to have those analogs. We have over the years faced criticisms for this, but that’s how most Americans were raised. It’s about progress, not perfection.”

Cell-cultured meat, insect protein

So where does PowerPlant see plant-based meat, eggs, and dairy fitting into the broader alternative protein market, which now includes a flurry of firms producing proteins via fermentation with genetically engineered microbes, and a new wave of companies developed meat, poultry and seafood from animal cells in bioreactors.

“The founder of Memphis Meats​ [Uma Valeti, MD] is a brilliant man and a limited partner in PowerPlant Ventures,” ​said Boylan. “He came to us very early on and asked would we like to invest in a seed round, and we said​ [no, but] thanks for the opportunity.

“Granted what they’re doing addresses the sustainability and the ethical issue ​[of industrialized meat production], but it doesn’t address the fact that meat is still loaded with cholesterol and it is inflammatory, and I would argue that most vegetable fats are a bit healthier than animal fats.”

He added: “I think cell-cultured meat is going to be an important market, although I think it may take longer ​[to hit critical mass] than some people think as getting the economics of this down are quite a challenge, but if anyone is going to solve it, it’s going to be Memphis Meats. I think it will have a place, but as consumers have become more educated and concerned with reading labels, it’s going to be interesting to see the adoption of petri-dish meat.

“It’s like insect protein. We’ve looked at 100 deals ​[in this space] but we just don’t see the American consumer jumping on that bandwagon within our generation, although I hope I’m wrong. I think lab grown meat is similar, although I applaud them for what they are doing.

“I think with plant-based meats, consumers can understand them. They are made from things like peas and rice, and no pun intended, that’s just easier to swallow ​[for consumers] than lab-grown meat, although I think it will have a place ​[in the market].”

‘I’m not anti-GMO, but many consumers are’

So what’s his take on the current debate within the natural products community, and some parts of the media, over whether plant-based meats are ‘highly processed,’ and out of sync with broader consumer trends?

Said Boylan: “I like​ [Impossible Foods CEO, Dr] Pat Brown and I think he’s a brilliant scientist, but we chose to invest in Beyond Meat because ​[CEO] Ethan​ [Brown] is maniacal in his pursuit of the cleanest ingredients and process possible, which includes no allergens, and nothing GMO.

“They ​[The Beyond Burger​ and the Impossible Burger​] are both very good products, but we like the less processed cleaner ingredient deck that Beyond Meat sports ​[although both are processed using high moisture extrusion techniques, and use similar ingredients, while the Impossible Burger contains more calcium, and adds vitamins.​ The main difference cited by anti-GMO activists is that the latter uses genetic engineering to produce its star ingredient ‘heme,' while its key ingredient is soy protein concentrate from GM soy crops].”

“I’m not anti-GMO,” ​added Boylan. “But many consumers are.”

Fund one a ‘phenomenal success’

PowerPlant’s first $42m fund, “quite candidly, has been a phenomenal success,” ​said Boylan: “We have proven that it is possible to do extraordinarily well while doing good for our society.

“If we change one thing, I think in this fund we’ll do less seed and more A and B round type financing. We’llbe looking for companies with slightly more revenue, generally brands in the $2-$20m range, with a focus on brands with a run rate of $5-10m in revenue. The fund expects to do three to five deals a year, with 12 to 15 deals in total out of fund II.”

He added: “We’re very selective, we dive deep, and don’t do the spray and pray method because it’s too hard to do the due diligence into that many companies.

“We’ll be writing a $4-8m first check with a 100% reserve for follow-on investing and we will go down very selectively and write a smaller check, but that will be the exception rather than the rule.”

‘There are so many companies coming to us, it’s truly mind-boggling’

While it would be great to do more seed funding, he said, “It takes exactly the same amount of time to do the due diligence needed to write a $500k investment as it does to write an $8m check, and we only have a small team.

“There are so many companies coming to us, it’s truly mind-boggling. In the last 12 months we’ve seen over 600 opportunities, so we’re talking about over 50 a month.”

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Plant based eating

Posted by David,

Instead of eating products, just eat produce.

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