Rethink Food Newsletter April 2024

Spotlight: Plant-Based Meats

In late March, our team joined fellow industry professionals at the Future of Food-Tech conference. Amidst the conversations about AI and climate disclosures, the topic that appeared to be at the forefront of many conversations was the state of alternative proteins. We’ve been monitoring the rise and pitfalls alternative proteins since our inception at Rethink Food, so we know that while there was a deal of mishaps in the category’s development, there’s still promising room for innovation.

In our latest blog post “Are Plant-Based Meats Cooked?” our Managing Partner Brad Jakeman explores the journey of plant-based meats, beginning with the rapid rise in sales from brands like Beyond Meat and Impossible Foods (fueled by consumer habits, environmental concerns, and clever marketing tactics) to the challenges the category has faced in meeting consumer expectations and sustaining market growth.

Motif Foodworks plant-based burger
Motif Foodworks Burger. Source: Motif Foodworks.
Plant-based protein substitutes in a grocery store refrigerator isle.
Alameda, CA - July 28, 2020: Grocery store refrigerator section with rows of various brands of plant-based protein substitutes. Licensed under Adobe Stock.

As Brad says, “plant-based proteins still have a lot of room to expand, even though consumer excitement for vegan meat substitutes does appear to be waning. The current wave of alternative meats sprang to popularity during a period of optimism driven by technology and venture capital spending. However, the food business is not the internet, and companies that produce plant-based meat are not internet startups. It’s evident that consumers, especially those outside of the U.S., are still willing to adopt more plant-based diets if given some encouragement from governments, even with the industry’s hype-boom-bust cycle.”

So, what went wrong? Brad offers four interrelated factors that may be driving the category’s lack luster performance including: the category name, not meeting consumer taste expectations, misleading ‘healthy’ labels, and high costs.

The good news is that we believe these issues are all addressable, but like with any emerging technology, it may just take some time to do so. With the proper innovation, collaboration, and marketing, plant-based meats can get back on the right course and generate positive impact for the environment and society.

In our view, the environmental impact alone [of plant-based meats vs. that of traditional beef] should continue to anchor our enthusiasm and support for technological innovation in the sector.” – Brad Jakeman, Managing Partner, Rethink Food

Read more.

Investment Updates

The agricultural landscape today is faced with the major challenge of needing to significantly cut emissions and land use while simultaneously producing more food to feed a growing population. This is one of the key challenges we are aiming to address through our investments at Rethink Food, and we believe that digitization and automation are best positioned to do so.

With that in mind, we are excited to announce the two new investments we made in early 2024 within our AgTech and Precision Farming vertical: Phytoform and Inevitable.

Phytoform is an agricultural biotechnology company working to improve agricultural sustainability by unlocking the genetic potential of plants. The company takes an innovative, technology-driven approach to trait development and implementation – pairing AI-driven trait discovery with genome editing implementation to create traits that reduce the environmental impacts of certain crops like tomatoes and potatoes.

The founders, William Pelton and Nicolas Kral, share an extensive background in plant sciences and molecular biology. They met during their PhD program at the Imperial College of London, where they experienced the challenges of translating research into real world applications. The duo founded Phytoform with a mission of radically reducing the impact of agriculture, targeting crops with large environmental and economic footprints.

Phytoform Founders William Pelton (Left) and Nicolas Kral (Right)
Phytoform founders William Pelton (Left) and Nicolas Kral (Right)

Phytoform has seen positive early traction, establishing industry partners in tomato, potato, and lupin seed markets alongside partnerships with national seed companies. The long-term goal of the company is to improve existing crop traits and introduce new, sustainable varieties to reduce agriculture’s environmental impact and boost crop value.

Inevitable (formerly known as Iron Ox) leverages AI, automation, and plant science to grow a wide variety of fruits, vegetables, roots, and tubers. The company’s technology can:

  • Reduce emissions associated with produce farming by up to 90%
  • Reduce pre-consumer food loss by more than 90%
  • Reduce emissions from produce transportation by 90%
  • Reduce water consumption by more than 90%
  • Reduce the land required for farming by 97%
  • Double the shelf-life of consumer’s produce

Furthermore, Inevitable can have lower costs of production than competing technologies. The company’s data science aims to eventually deliver maximum productivity in greenhouses and on farms – making continuous production improvements overtime and a substantial reduction in labor. Additionally, Inevitable can use its plant science and data science capabilities to develop new varieties of greenhouse-grown (or open field) crops.

Inevitable’s CEO, Luci Kempton, brings strong operational skills and a range of food and ag industry experience to the team. Luci oversaw all greenhouse gas operations (5 acres) at Iron Ox, and previously held roles at GlaxoSmithKline and Procter & Gamble.

Inevitable CEO
Inevitable CEO Luci Kempton

We’re very excited to welcome these two companies to our portfolio and look forward to supporting their continued growth alongside likeminded investors.

Portfolio Highlights

Kernel automation preparing food
Photo Credit: Dina Litovsky, GrubStreet

Kernel opened its first store location earlier this year on 315 Park Ave S in Manhattan. The automated, fast casual dining restaurant is serving up a wide selection of chef-crafted, plant-based sandwiches, salads, and sides. Check out the food reviews in Eater and Bon Appetit and the features in Inc. Magazine and New York Magazine’s Grubstreet.

Planet FWD logo

In March, the SEC passed new, mandatory climate disclosures requiring publicly traded U.S. companies to measure and report their Scope 1 and Scope 2 emissions. The legislation aims to standardize climate-related company disclosures about greenhouse gas emissions, associated risks, and investment toward transitioning to a low-carbon economy. Planet FWD, which helps companies calculate and report their greenhouse gas emissions across Scopes 1, 2, and 3, is uniquely positioned to partner with global food and consumer packaged goods (CPG) companies, retailers, and their suppliers to meet these requirements.

Biogut fiber

Brightseed partnered with leading hemp foods brand Manitoba Harvest to launch Organic Bioactive Gut Fiber, a breakthrough multi-benefit fiber solution powered by Brightseed® Bio Gut Fiber. The product uses Brightseed’s novel ingredient from upcycled hemp hulls, the outer shells of hemp seeds, which its AI-led research identified as an untapped source of dietary fiber and gut-health beneficial bioactives. Mantioba Harvest Bioactive Fiber can be found at Whole Foods Markets nationwide.

Omeat ground beef

Omeat is preparing to launch its first product, Omeat ground beef, in grocery stores, which will deliver all the protein, iron, and other benefits of conventional meat but with less saturated fat, and free of GMOs, antibiotics, and hormones. 

The Latest from the Rethink Food Team

The first few months of 2024 has included a busy schedule of conferences, speaking opportunities, and exciting developments for the Rethink Food team.

Rini speaking on panel at Opal Group conference

Rini spoke on the “The Role of Venture Capital and Private Equity in Seeding the Future: Challenge and Opportunity in Early-Stage Impact Investing” panel at the Opal Group ESG & Impact Investing 2024 conference.

IA 50 recognition graphic

Our parent company, Rethink Capital Partners, was named to the ImpactAssets 50 list* for the third year in a row! Rethink Food is honored to be a part of this platform and team.

Future of Food-Tech panel

In late March, Rini joined fellow industry professionals to moderate a panel on “Prioritizing Health: Pioneering Technologies Advancing Food & Nutrition” at the Future of Food-Tech conference. 

Upcoming Events

Our team is excited for several upcoming events and opportunities! Connect with us at the following events:

  • Find Rini on stage at the Milken Institute Global Conference, May 5-8, for a panel  session on “Systems Finance for Sustainable Development.”
  • Connect with Brad at Wealth of Nations Impact Hybrid Conference on May 30 where he will speak on a panel about driving social equity through venture.

*This communication is or may be considered to be an endorsement by ImpactAssets of Rethink Food, LLC (the “Fund”) or Rethink Capital Partners, LLC (the “Company”). ImpactAssets is not a client of the Company or an investor in the Fund or any other fund or entity advised by the Company.  ImpactAssets is NOT compensated by the Company or Fund.

The information contained herein is confidential and should not be distributed, published or reproduced, in whole or in part, nor should its contents be disclosed by recipients to any other person without the prior written approval of Rethink Food.  This material is for general informational purposes only and is not intended as investment advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation, or sponsorship of any company, security, advisory service, or product. This information should not be used as the sole basis for investment decisions. All content is presented as of the date published or indicated only, and may be superseded by subsequent market events or for other reasons. Past performance is no guarantee of future results. Investing involves risk including the loss of principal and fluctuation of value.