Prominent Australian plant-based meat company v2food gains a foothold in the US market with the acquisition of Daring Foods, which it plans to expand beyond the niche un-breaded plant-based chicken category, where it currently plays with the help of a substantial tech-stack and a strategic partnership with food and biotech multinational Ajinomoto.
The deal, which was announced last week for an undisclosed amount, brings together two complementary brands in the highly fractured plant-based meat segment that when combined could solve some of the biggest challenges facing the alternative protein segment including consumer demand for cleaner label and more nutrient dense products that do not compromise on taste and texture.
The acquisition’s potential impact is further magnified by 2vfood’s existing partnership with Ajinomoto, which has a deep expertise in food science to address technical challenges hindering consumer adoption of plant-based protein and a significant presence in the US frozen food market, including extensive distribution.
Daring unlocks US market
Little-known in the US, v2food has a strong track record for fast growth – capturing about 30% of the plant-based meat market in grocery stores in Australia since it spun off from the Australian Government CSIRO’s technology arm in 2019.
But with a population of 27 million, Australia’s market potential is significantly smaller than the US, which has 12 times the population and 10 times the plant-based meat market, said CEO Tim York.
While York wanted to break into the US, he said he did not see a clear path forward for the brand in the country’s highly fractured plant-based meat market – which he said pushed 2vfood to seek an established player with extensive distribution and strong consumer awareness.
“What attracted us to Daring is we really wanted to get into the US market. A couple of years ago, we had a look at launching the v2food brand here and we just felt like it was too late. I felt like there were so many brands already hitting the shelves. The category didn’t need more brands – in fact it probably needed consolidation. And we just didn’t feel like we get the 2vfood brand on shelf,” York said.
“And then we saw the Daring business, and we just loved it,” he added.
“Daring is one of two brands in the US that is stealing growth in plant-based meat – the other being Impossible,” and that is part because Daring offers a clean label with a short list of ingredients that consumers can easily recognize, York said.
Daring’s original plant chicken pieces are made from water, soy protein concentrate, vegetable oil, salt, natural flavor and spices. It also packs 14 grams of protein, 5 grams of fiver and only 2 grams of fat – none of which is saturated.
For comparison, Gardein’s Ultimate Plant-based Chick’n Strips original flavor is made from water, vital wheat gluten, soy protein isolate, canola oil, pea protein concentrate, textured wheat protein, methylcellulose (which can be a polarizing ingredient), sunflower oil, natural flavors, salt, garlic powder, yeast extract, onion powder, titanium dioxide (which several states have attempted to ban), spices and lactic acid. A serving has higher protein at 17 grams but also higher fat at 6 grams, including 0.5 grams, and no dietary fiber.
York said Daring also was appealing because it has extensive distribution in 16,000 stores and “is one of the few brands that can hold its head up in a Walmart but also a Whole Foods.”
v2food’s tech stack opens doors for Daring beyond plant-based chicken
York sees significant potential to expand Daring beyond the plant-based chicken segment, which he estimates is about 3% of the total plant-based market in the US, while still preserving its clean label, nutrient-dense status by leveraging 2Vfood’s proprietary tech stack.
“Our original technologies are all around taste and texture,” which are two of the biggest stumbling blocks for adoption of plant-based meat, York said.
For example, the company uses amino acid chemistry to create flavors, has patented texturants that “give our products more of the heterogeneous texture that meat has as opposed to the very homogeneous, soft and spongy texture” of many plant-based meats without relying on methylcellulose, which many consumers want to avoid, said York.
In addition, the company is pursuing regulatory approval for a color-changing technology using algae that allows a product to change from red to brown as it cooks, but unlike competing technologies, v2food’s solution is natural, non-GMO and clean label.
The algae system also is less expensive to produce than competing color-changing technologies, he added.
“We see ourselves as a food tech company first, and then we use brands to bring those technology stacks to life,” York added.
The company’s existing partnership with Ajinomoto, which began two years ago as an IP collaboration to bring proteins to market in emerging economies, further magnifies the potential of 2Vfood’s technology.
Ajinomoto’s strong frozen distribution network also enhances 2Vfood’s plan to bring Daring to Australia, where the plant-based protein market currently is focused on chilled rather than frozen, York explained.
