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Competition among alternative protein players gets hot as companies beef up with new deals

The competition for control of the burgeoning market for burger replacements (and other alternatives to animal proteins) continues to heat up.

Beyond Meat and Impossible Foods the two leading contenders for top purveyor of plant-based patties (and other formulations) have spent most of the typically sleepy summer months jockeying for the position as top supplier to a food industry suddenly ravenous for alternatives to traditional meat product.s

As soon as the first Impossible Whoppers came off the flame broilers at Burger King, Beyond Meat was announcing a new fast food chain supply deal of its own with Subway.

Through that agreement the publicly traded provider of plant-based products will be grinding up meatless meatballs for Subway’s new vegetarian option to the classic meatball sub.

Subway will roll out meatless meatballs in 685 of its franchise locations in the U.S. and Canada starting in September.

Not to be outdone, Impossible Foods came swinging back with some a new partnership with the institutional food prep giant Sodexo. At roughly 1,500 Sodexo locations food slingers at healthcare facilities and corporate and university cafeterias will unveil new options like Impossible Foods-based sausage muffin sandwiches, sausage gravy and biscuits, steakhouse burgers and creole burgers.

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Image courtesy of Sodexo

“Sodexo is committed to providing customers with more plant-forward and sustainable options as part of their diet,” said Rob Morasco, senior director culinary development, Sodexo, in a statement. “We are excited to expand our menu to include the Impossible Burger’s flavorful blend, which will be featured in several new products this fall.”

Set against this meatless horserace for national food service dominance, other plant-based providers have launched to take the startup direct-to-consumer approach to satisfy vegetarian cravings for other types of food substitutes.

It was partially in response to this furor over the vegetarian market that the world was introduced to Nuggs. Ben Pasternak, the company’s young founder, first came to fame as the teenage entrepreneur behind the social media app Monkey.

When Monkey was sold to a Chinese company in 2017, Pasternak turned his attention to food. He’s been cooking up the idea for Nuggs since that time. In 2018 the core team assembled with Pasternak bringing on Liam Mullen, a former pastry chef and self-trained molecular gastronomist who was working for the high-end New York restaurant Daniel at the age of 16.

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Image courtesy of Nuggs

Unlike Impossible Foods, which has faced supply chain woes thanks to its initial strategy of building its own manufacturing facilities, Nuggs is manufactured by McCain Foods, a food prep giant that also led the company’s $7 million round. Other investors include Rainfall Ventures; Greylock Discovery Fund; Maven Ventures; NOMO Ventures; M Ventures; ACME Capital; Founder of MTV and CEO of iHeartMedia, Bob Pittman; Casper Founder & COO, Neil Parikh; and Former President of Tumblr, John Maloney.

While Beyond Meat and Impossible Foods have grabbed most of the headlines as the first generation of protein substitutes to really make a dent with consumers, Just (the company formerly known as Hampton Creek) has also nabbed some major deals with big fast food chains for its big product — egg replacements.

Launched in 2018, the egg replacement from Just inked a major deal in late July with Tim Hortons, the Canadian coffee, donut, and sandwich chain. Much as Beyond Meat has found a home for its meatless sausages at Dunkin Donuts in the U.S., Just has seen Tim Hortons take its eggless egg replacement to a Canadian consumers (Hortons also has a sandwich using Beyond Meat).

Some companies are going beyond plant-based protein replacements to lab-grown versions of the real thing. That’s been the story behind Perfect Day, which sold out of their $20-per-pint ice cream in a matter of hours. Like Impossible Foods and Beyond Meat, the company intends to sell through ice cream manufacturers rather than going direct to consumers with its own product, according to a CNBC report.

The three protein replacement companies have grabbed investor attention and heralded a surge of venture capital investment into plant based protein products. In all, Beyond Meat, Impossible Foods, and Just have snagged over $1 billion in funding.

For investors in Beyond Meat, the $122 million in capital will yield billions in returns. The company’s market capitalization is up to a meaty $13.4 billion from $1.5 billion when its stock first began public trading. Analysts at Barclays predict the market for alternative proteins could hit $140 billion by 2029.

The makers of the virtual influencer, Lil Miquela, snag real money from Silicon Valley

Brud, the actual company behind one of Instagram’s most popular virtual influencers (it’s a thing), has raised millions of dollars from Silicon Valley investors because this is 2018 and everything is awful.

Last week, the Los Angeles-based startup led by Trevor McFedries, outed itself as the collective consciousness behind the virtual celebrity Lil Miquela and her less well known contemporaries Blawko22 and BermudaisBae in a choreographed melodrama worthy of Los Angeles’ best reality television.

i am deeply invested in the drama surrounding lil miquela and now you all have to be too. sorry!!! https://t.co/ta1T4rDFGz

— maya kosoff (@mekosoff) April 19, 2018

The subject of numerous glowing profiles in online and print fashion and lifestyle magazines (including, most recently, in High Snobiety), Lil Miquela’s stardom (and her fellow avatars) fascinated because the characters’ creators coyly toed the line around “her” self-awareness and their own. In the process, they created a sensation that’s become well-known worldwide.

It’s less well-known that the company is backed by some of the biggest names in venture capital investment — firms like Sequoia Capital. Our sources put the company’s funding somewhere around $6 million in its recent funding round.

There are other notable investors from Silicon Valley and New York rumored to be in the round — like New York’s BoxGroup and the Bay Area’s SV Angel. Sequoia declined to comment for this article and Box Group’s David Tisch did not respond to a request for comment.

All of the virtual drama with Miquela started late last week when news outlets (including TechCrunch) reported that Miquela’s Instagram account (or that of her handlers) was hacked by operators of a social media account belonging to another virtual personality known as “Bermudaisbae” (a more right wing social media persona with fewer followers).

McFedries, brud‘s founder and chief executive, confirmed that the Miquela account had been hacked in a text exchange with me, writing, “some redditor idiots hacked the page we think.”

That was a lie.

The account “hack” was architected by brud as part of an ongoing virtual reality drama playing out on Instagram and other social media platforms between avatars it had developed, all designed to attract media attention, according to people with knowledge of brud and its plans. It worked. 

McFedries has not responded to further requests for comment after confirming that the Miquela account was “good”.

One Los Angeles investor familiar with the company said brud was “using conflict to introduce new characters… same as the Kardashians always have.”

The investor added that two years into the development of the Miquela persona, brud‘s founders knew that the fad could lose some of its luster as the is-she-or-Isn’t-she-real tension dissipates under the weight of continuously thwarted expectations — like a post-modern twist on the will-or-won’t-they dramatic tension defining most sitcoms since Cheers.

“People aren’t going to buy that she’s human so they make it seem as if she’s had an existential crisis and now she is the first in a breed of conscious AR characters that they will build a world around,” this investor wrote. “[Manufacturing] social influence.”

Blawko22 and Lil Miquela imposed over a gas station exterior simulating a pit stop on the road to Coachella

For his part, the 33-yar-old McFedries had been manufacturing social influence in Los Angeles through his talents as a dj, producer and director before entering the startup world.

First under the name of DJ Skeet Skeet and then as DJ Skeeter, and, finally, Yung Skeeter, McFedries has worked or performed with a number of the world’s best selling recording artists including Chris Brown, Ke$ha, and Katy Perry (and — interestingly — more obscure acts like Bonde do Role).  

Working as an an “artist advocate” for Spotify, a DJ for a radio show on iHeartRadio, and as a spokesman for VitaminWater sustained McFedries along with managing the career of BANKS and executive producing her first album and a single on Azealia Banks’ 2014 record “Broke with Expensive Taste” — at least according to a Wikipedia page on Yung Skeeter. 

Around this time McFedries also began investing in companies, according to AngelList.

Roughly two years after the Banks record release, Lil Miquela made her first appearance on Instagram. And the rest is history as written in Internet archives and memes. Ephemeral, but infinite.

The project that brud seems to be pursuing — turning celebrity into a virtual commodity; commenting on the unreality of the “real” entertainment industry by literally creating an unreal celebrity — is fascinating.

There’s certainly a valid criticism to be made about the ways in which celebrity operates, the ways in which our “social” media has corroded society, and the unbridled power of these platforms to transform messengers and their messages into movements.

Perhaps brud wants to make these critiques through its very existence — or at least use its low-brow as high-brow (or is it vice versa?) intellectual appeal as a veneer over the more crass (but potentially honest) mission of selling more shit more effectively through the use of spokespeople whose views only change when their creators want them to (it worked for Hollywood’s star system). That at least gets sponsors and advertisers out of the potentially messy situations that can come from working with spokespeople whose actions can’t be controlled by software — or an ingenious marketing team.

In the High Snobiety profile-as-honors-senior-English-thesis on Lil Miquela published yesterday, the avatar’s own spokesperson was quoted as saying:

“The internet is endlessly powerful, and that power has been wielded in many ways. It feels like we’re not going to put the genie back in the bottle, so we’ve got to learn how to leverage these tools in positive ways. I’ve used my platform to raise real money for important organizations throughout LA and I’ve seen lives changed as a result. I think the only chance we’ve got is to collectively teach our loved ones how to think critically and how to spot misinformation. I know that we can manifest the change we want to see, and the internet can be a part of that.”

It’s a lofty goal backed by a number of inarguably good works. However, lying to reporters may not be the best way to continue trying to achieve it.