On April 22, 1970, Earth Day was founded to honor our planet and rally for environmental reform. It marks the birth of modern environmental movement, raising public awareness on the impact of man-made activities on the planet. In the spirit of this momentous day, Green Monday was launched on Earth Day in 2012.
On the past Earth Day, Green Monday held the inaugural Earth Day Forum themed “The Business of Sustainability 2016” to draw public attention to the need for a more sustainable economic model. The current capitalistic model has, unfortunately, proven to create environmental problems rather than combat against them. At the Forum, game-changing entrepreneurs, impact investors and sustainability thought-leaders across the globe shared invaluable insights on the business of sustainability.
The Green Monday team was delighted to conduct interviews with these visionary trail blazers who shared the latest trends and developments in their areas of expertise. In this part, Chris Kerr, Sebastiano Cossia Castiglioni and David Benzaquen give us the inside scoop of the plant-based food space.
Chris Kerr, Partner, New Crop Capital
With more than two decades of leadership experience in financial and venture capital management, Chris Kerr serves as investment manager of New Crop Capital. In light of the current highly inefficient food production system heavily dependent on animal agriculture, New Crop Capital invests in innovative companies that develop cultured and plant-based meat, dairy, and egg products. Some of its funded companies are in fact pioneers in the plant-based food space, such as Beyond Meat, Memphis Meats and Lyrical Foods.
According to Chris, the growing interest in food techs came hot on the heels of the showcasing of Daiya Food Inc. alternatives in 2009. “It’s the first vegan cheese that melts. In my opinion, it opened up a lot of companies that weren’t paying much attention to the vegan space. All of a sudden, there was a lot more activity going on in that space,” he remarks of the chain reaction caused by Daiya. He also explains that another big shift occurred when Kleiner Perkins Caufield & Byers, a seasoned venture capital firm out of Silicon Valley, funded Beyond Meat. That prompted other investors to turn their gaze to food tech start-ups.
Cultured meat is bound to take center stage in the next round of plant-based food craze. Chris reiterates, “New Crop Capital invests in very risky but very disruptive companies. There is still a long way to go for cultured meat. If it’s successful, it will change the entire food landscape.” He also concedes that capital funds have a lifespan and thus, not many people are willing to take on that. However, driven by the conviction to do greater good, most plant-based food space investors look at the impact in the long run. “The financial return isn’t the only return. They are doing it for other reasons. They want returns for the animals, humans and the earth,” he elaborates.
New Crop Capital also invests in delivery services that facilitate the promotion and sale of plant-based products, such as Lighter Culture and Purple Carrot. Chris said these companies send new plant-based products to consumers right at their doorstop and therefore they can collect their feedback much more efficiently than selling them at supermarkets. Another upside is that the service companies expose customers to and get them hooked on certain plant-based food brands.
Other countries are also catching up in the plant-based food space, introducing innovative products. Sunfed Meats, a start-up company in New Zealand that makes yellow peas into chicken chunks, has garnered US$1.2 million from international investors to take the product to market. In addition to Memphis Meats, MOSA from the Netherlands and the Modern Agriculture Foundation from Israel are trying to create cultured beef and chicken respectively.
For plant-based alternatives to grow exponentially and take a bigger slice of the food market, Chris emphasizes that such products have to meet consumers where they are in terms of texture, taste, price and availability. Consequently, New Crop Capital invests in culinary-driven food techs that hire good chefs to concoct tasty products. It also explores the possibilities of bringing plant-based products to underserved markets. Chris stated that India is a complex market where religion guides people towards a plant-based diet. The critical question is whether they need such meat alternatives. Moreover, the infrastructure of the country makes it complicated to store the products.
Given he is at the frontline witnessing all the innovation of the field, Chris is optimistic about the plant-based food industry. He says reassuringly, “it takes a lot of work to make the future bright. With the suffering all around us, at least we know answers are coming.” Investments are particularly crucial for early stage companies as they help ensure that great ideas will be brought to fruition. Chris believes that sustained behavior change can result from an increasing number of food techs entering the plant-based food space. “Companies have to up their game and everyone wins.”
Sebastiano Cossia Castiglioni, Chairman, NKGB Strategic Advisory
Sebastiano Cossia Castiglioni wears more than one hat – he is the Chairman and CEO of NKGB Strategic Advisory, specializing in venture capital, private equity and M&A. He is also the Founder and Chairman of Opteres, an exclusive network of fine art collectors in the world. Among his diversified business portfolio, Querciabella, a vegan and biodynamic winery in Italy, is one prime example that reflects his ethical visions and inclinations.
Sebastiano converted Querciabella to organic in 1988. Since the year 2000, the vineyard has been practicing cruelty-free biodynamics, which he firmly believes produces premium quality wine. Cruelty-free biodynamics excludes the use of animal-derived products in all stages of grape growing and winemaking. Moreover, it restores the ecosystem to its most balanced state where nutrient-dense soil provides ideal environs for vines to grow. This results in better fruits and thus, better wine. Sebastiano emphasizes that quality is the key to winning customers over. “Quality is an investment. I’m not interested in cutting corners and making cheap wine,” he states.
Sebastiano made his first plant-based investment in Beyond Meat in 2013, after hearing about it from Chris Kerr, whom he dubs as his guiding light in the plant-based space. “As someone who invests in many different things, I’m always looking for investments that would match my values,” recounts Sebastiano, a vegetarian/vegan for over 35 years. Therefore when the option of investing in analog meat that can be transformational and revolutionary was presented to Sebastiano, he did not think too long about it. He has also invested in Lighter Culture, Sunfed Meats, the Jackfruit Company (selling prepackaged meat alternative using the exotic fruit) and Matthew Kenney Cuisine (the raw and vegan culinary school founded by the star vegan chef Matthew Kenney).
Sebastiano takes the following factors into consideration before making an investment: originality of the idea; if the idea will be executed by the right people; and if the investment is aligned with vegan ethics. He added such products have to target non-vegetarians. It may also be best to brand them as ‘ecological’ and ‘innovative’ instead of ‘vegan’ since people do not want to be deprived and their freedom of eating be interfered. As an animal activist, Sebastiano sees his role as combining activism and impact investments, saying,“We are not just telling them not to eat meat, but also offering them choices that are practical, tasty and good for their health.”
David Benzaquen, Founder, PlantBased Solutions
As an 18-year vegetarian/vegan and with more than 10 years experience in non-profit organizations, there is no doubt that David Benzaquen has an affinity with the planet and animals. Through his work experience, David has found simply advocating people to go vegan and campaign work is not creating enough impact. In order to make the concept of vegetarian/vegan practical and penetrating, David founded PlantBased Solutions in 2012. The Company focuses mainly on branding, marketing and business consulting for plant-based consumer package companies (CPG), mostly food and beverages, and also supplements and cosmetics companies.
To David, going green never means making sacrifices. “We shall never sacrifice for doing good things. With easier, more accessible, cheaper, more delicious options, there is a much greater chance that our customers would switch their diet.” In order to make plant-based alternatives readily acceptable by the mainstream market, they have to be comparable in terms of taste and cost. “We love people doing things for a right reason, but if it does not taste good, or is not comparable to the products of similar nature available on the market, it is not good. Consumers buy food every day. A 20% increase in price may have a justification such as a cleaner ingredient list and natural ingredients etc. However if the price is double or triple, this is making the product unrealistic.”
In terms of marketing, plant-based products are no different from the mainstream options. “Marketing for these kinds of products is about telling a story. If we tell the story of how a company saves the planet and helps the world, it is telling a beautiful truth,” David says. “The stories of my client are so authentic and beautiful. It’s about passion. It touches people’s heart.” To him it is a gift to tell the story of a product that is making positive impact on the world, and, simply be inspired.
“Another thing is what food means to people,” David emphasizes. “It’s not just about being healthy. Some natural brands are talking too much about how natural they are. Dairy-free, nut-free, soy-free, gluten-free…To a point that it tastes like cardboard, or plastic. Taste-free. This does not work well as a strategy because lacking something does not sound attractive to the consumers. Consumers do not buy things because it is less bad. We have to ensure that the food excites people, surprises people, inspires people, makes them laugh and makes them feel touched.”