FoodTech Weekly #20 by Daniel S. Ruben

FoodTech Weekly #20

Hi there,

I hope this doesn't bug you out, but the big news this week isn't the fly that made an appearance during VP debate. The real buzz in town has been the insect-as-feed industry. Ÿnsect announced it has extended its Series C to $372M, bringing its total funding to $425M. The funding will be used to build the world's largest insect-as-feed factory outside of Paris, but also to expand into North America. The company uses mealworms, which together with Black Soldier Fly (BSF) larvae are the two most common species used in this novel industry. Insects can upcycle nutrients from food waste, while also providing an excellent source of protein, vitamins and minerals to be used as animal feed - in e.g. aquaculture, for poultry, and for pets (and the insect manure -- frass -- can be used as fertilizer). So insects help create a more circular food system. The investment round into Ÿnsect is likely the largest ever AgTech deal made in Europe, and comes shortly after the announcement from UK startup Entocycle that they'd secured a £10M government grant to build the country's first industrial-scale insect-as-feed production facility. Also, Bulgarian BSF startup Nasekomo has entered a joint venture with French animal genetics experts Groupe Grimaud to improve BSF performance.

And on Oct 1, the Court of Justice of the European Union (CJEU) clarified that 'whole edible insects' do not fall under the old Regulation on novel foods, the (EC) 258/97. This should make it easier for new operators to commercialize whole insects.

All in all, this industry increasingly seems like a force to bee reckoned with [see what I did there?]

Highligths

• Conversations: Tom Johansson and Emil Wasteson (Hooked) and Nessim Abadi (The New Butchers)

• Noteworthy: Kipster launches plant-based VEGGS; Planeteer's edible spoons; Picnic raises $3M for automatic pizza assembler; Asia's largest rooftop farm is beautiful

• The Profile: Robert Colangelo

• Random Stuff: Climate-impact pop-up store; urine-powered fertilizer; cursing parrots. And more.

Conversations

• Had a chance to try to plant-based tuna and salmon from Swedish startup Hooked. The company is led by Tom Johansson and Emil Wasteson. They recognized the growing global demand for seafood, but thought there should be a great plant-based alternative to seafood, with a lower environmental impact. So they've developed a shredded tuna product, which can be used in e.g. poke bowls, wraps, sushi, salads, pasta dishes, and pies. Recently, Hooked took in $175K from Katapult Ocean, and is bringing in some additional investors. Hooked's plant-based tuna is currently being piloted at restaurant chains in Sweden; later this year, Hooked expects to launch officially in foodservice. In 2021, the company plans to expand rapidly across Europe -- where the estimated market potential is €2B (salmon and tuna are the two most consumed seafood in Europe). Hooked believes they'll sell enough product next year to replace 50,000 salmons and tuna fish. Plant-based salmon, shrimp, and crab are next in line. So what did their plant-based tuna and salmon taste like? The tuna is really good. Nice scent and texture, and looks like tuna. It's made of e.g. soy protein, seaweed, algae oil (for omega-3) -- and it definitely tastes like tuna. The cracker/tomato sauce/tuna combo was awesome. I also got to try their salmon prototype; one smoked version, and one lemon version. I liked the latter one, but the prototype definitely needs a bit more tweaking in terms of texture/mouthfeel, and taste. I'm excited to see where Hooked takes this. There are a couple of other actors doing similar things globally; e.g. Good Catch, New Wave Foods, Legendary Vish, Kuleana, and Ocean Hugger Foods (currently paused) in the plant-based space, and Wild Type, Blue Nalu, Finless Foods, and Shiok Meats in the cell-based space. Hooked will be raising a larger round next year, so investors interested in getting to know this startup better can reach out to Tom and Emil via email.

• Got to know Nessim Abadi of Brazilian plant-based meat startup The New Butchers. Nessim co-founded New Butchers because it married many of the things he believes in, including advancing sustainable, health-promoting businesses. The company has developed a meat burger, a chicken burger, chicken filet, and a salmon filet, and is working on pork and other products (using pea protein rather than soy, and adding seaweed for the omega-3 in the salmon filet). New Butchers try to make its products in the cleanest, healthiest way possible, with as few ingredients as possible. The company launched its first products one year ago, took in angel investments in April 2020, and is growing rapidly (it already has 15 employees).  If you have connections in the Brazilian food retail and foodservice market, or if you're a local ingredient supplier for plant-based foods, or you're an investor looking to learn more ahead of New Butchers' coming Series A round, you can get in touch with Nessim via LinkedIn or email.

Noteworthy​

• Plant-based food startup Next Gen, based in Singapore, has raised $2.2M. The company aims to produce 5,000 tons of plant-based meat annually, and expand to China, the U.S., and Europe over the next three years. The first product will be a plant-based chicken analog.

• Netherlands-based company Kipster, which claims to be the most environmentally sustainable egg-laying hen farm in the world (with a strong animal welfare ethos), has developed a vegan egg called VEGGS (link in Dutch). The new liquid product is made from e.g. yeast and soy protein and can be used for making scrambled eggs. The company has worked with chefs, students, and academics from Wageningen University over 2 years to develop the new vegan egg. The products will be on supermarket shelves in 2021. Says Ruud Zanders, Kipster co-founder: "VEGGS does not require an animal to be exploited, and in the future we can manage to provide our food with far fewer animals, even no animals, because we will have VEGGS that still offers the possibility for a delicious scrambled egg for breakfast.”
  

  

  VEGGS, from Kipster

• A new study from UC Davis shows that feeding Asparagopsis taxiformis, a red seaweed, to cattle reduced enteric methane emissions by over 80 percent. The scientists believe this is a viable feed to significantly decrease the carbon footprint of ruminant livestock. More in this Forbes piece.

• A South African Ph.D. student and his team have created the SmAvo, a plastic, 3D printed avocado containing sensors. The sensors can measure acceleration and rotational velocity, pitch, roll and heading, temperature and relative humidity, barometric pressure, light intensity, GPS-geolocation, speed and heading. By using SmAvos from harvesting and onwards in the value chain, the data collected can inform decisions about changes needed to ensure a better quality fruit to the consumers. The South African team is also working on the SmaTo, a smart tomato, which will give similar information. 

• Asia's largest organic rooftop farm which opened last year in Bangkok looks amazing. TURF (Thammasat University Rooftop Farm) spans 237,000 sq. ft (22,000 sq. m), is equipped with solar panels, harvests rainwater, and grows more than 40 edible species of crop, including fruits, indigenous vegetables, herbs, and rice.

• Planeteer's incrEdible spoon is a flavored, plant-based, fully edible spoon. Flavors include chocolate, vanilla, black pepper, masala, oregano chili, and plan. The spoon stay firm between 25-45 minutes (depending on whether the dish is hot or cold). Here's a review from (no pun intended) the Spoon.

• Picnic, which produces an automated system to assemble things like pizza, burritos, subway-style sandwiches and more, has raised $3M. Here's a cool 90-sec video of the system in action.

• The World Food Programme's Innovation Accelerator has created WFP-X, the first-ever exploration of moonshot innovations for urban food security in megacities of the future. First up is Dar-es-Salaam.

The Profile
Robert Colangelo started Green Sense Farms in 2008, as one of the early adopters of vertical indoor farming. They went through the Thomas Edison phase, figuring out 100 ways not to build a vertical farm. Today, the company runs two farms in Indiana, and licenses its technology to third parties (that are e.g. build

ing a farm in China). The company grows e.g. kale, arugula, bok choy, watercress, basil, herbs, and lettuce, harvests up to 26 times per year, and sells to retailers such as Whole Foods, as well as retailers such as Eataly. Green Sense Farms targets building farms in locations with extreme heat or cold, and where produce travels a long distance to get to the consumers. Robert feels the nascent vertical farming industry consists of dreamers, schemers, and entrepreneurs. He thinks vertical farms will mainly grow ready-to-eat thinks like kale, arugula, swiss chards, and microgreens -- and that optimization around electricity use (LEDs, HVAC, and pumps), automation for cutting and packaging, and other tweaks can help make this industry more relevant. He also longs for a future where more research funding goes into things like fruits, vegetables, and seeds, rather than the big staple crops. Since 2008, he and Green Sense Farms have come a long way towards helping the vertical indoor farming go from novelty to mainstream.

Random Stuff

• Swedish FMCG (CPG) brand Felix (part of Orkla Foods) did a pop-up store in Stockholm last week; prices were based on the climate impact of the various products. I went there to check it out (thanks J.S. for the invite!). Each shopper was given mock money equivalent to an individual's weekly carbon emission budget (18.9 kgs / 41 lbs of carbon dioxide equivalents, CO2e). Then, the shopper could then see how many products that would get you. The point of the whole exercise was to showcase the true cost of food, in terms of CO2 emissions. The food system is responsible for 25% of total greenhouse gas emissions, and production of certain animal-sourced foods like red meat and dairy are especially high emitters. In the pop-up store, 0.5 kg (1.1 lbs) of ground beef would set you back 14 CO2e of your weekly 18.9 CO2e budget. And the per kg / lb price of conventional meatballs was 10x the CO2e price of the plant-based meatballs. Right now, if a consumer wants to understand the CO2 emissions of Felix's food products, he/she has to head to the Felix website to get that data. I don't think anyone will do that. But perhaps front-of-package climate labels (which are being rolled out) combined with e.g. QR codes or some AR solution could make it easier to access the info, and act based on the data. Danish grocery chain COOP already has an app that gives a personalized carbon footprint tracker (more in this WaPo article).

• If you're a plant-based or cell-based foods startup (anywhere in the world), check out Pitch & Plant 2020. Finalists can receive investments of at least $155K. The deadline to apply is Nov 8, 2020.

• If you're a startup that is developing a disruptive technology for the AgTech / FoodTech sector, apply to get on Forward Fooding's 2020 FoodTech 500(inspired by the Fortune 500). The deadline is Nov 30, 2020.

• A French startup, Toopi Organics, has developed a urine-powered fertilizer.They hope it'll reduce our reliance on synthetic fertilizers, that boost food production but mess up the environment. 

• Five parrots at the Lincolnshire Wildlife Centre (Billy, Eric, Tyson, Jade, and Elsie) have had to be separated, as they wouldn't stop swearing at visitors; 'keepers say the birds encouraged each other to keep cursing.' In August, Chico, a fellow parrot at the zoo, went viral for singing Beyoncé's 'If I Were A Boy'.

​I love you.
Daniel
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Disclosures: I'm a consultant to the Rockefeller Foundation Food Team. I'm a mentor at accelerators Katapult Ocean, Big Idea Ventures, and Bloomer. I'm an advisor to Noquo Foods, BIOMILQ, Volta Greentech, Veat, IRRIOT, Rootically, Holistal, Vultus, and Ignitia; in some of these startups, I have equity. 

Boring disclaimer: The newsletter content is intended only to provide general and preliminary information to folks interested in FoodTech, and shall not be construed as the basis for any investment decision or strategy. I assume no liability as regards to any investment, divestment or retention decision taken by readers of this newsletter content.

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