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Plant-based meat, egg, dairy investments hit $16B in 2018

May 6, 2019

More than $16 billion was invested in U.S. plant-based meat, egg, and dairy companies over the past 10 years, and $13 billion came in the past two years, according to a report released today by The Good Food Institute.

The flurry of investment activity in 2017 and 2018 also included a clear uptick in acquisitions. Since 2009, there were 19 acquisitions of plant-based companies and 10 of these occurred in the past two years. The biggest acquisition took place in 2017, when plant-based milk market leader WhiteWave Foods was acquired by Danone for $12.5 billion, according to GFI.

"Investors and entrepreneurs are capitalizing on a global shift in the way meat is produced. The market opportunity here is massive," said GFI Executive Director Bruce Friedrich.
"Shifting consumer values have created a favorable market for alternatives to animal-based foods, and we have already seen fast-paced growth in this space across retail and foodservice markets."

Although the amount of capital invested decreased from 2017 to 2018 following WhiteWave Foods’ acquisition, the number of deals continued to rise to 46 in 2018, which is a 39% increase from the previous year. This increase is part of a steady upward trend in deals completed over the past 10 years. 

In 2018, $673 million was invested in plant-based meat, egg, and dairy companies. The largest minority investment of 2018 was Impossible Foods’ $189 million late-stage VC round which included an additional $50 million in debt financing earlier in the year. This was followed by Ripple’s $65 million Series C round, Beyond Meat’s $50 million Series H round, and Califia Farms’ $50 million private equity round.

To quantify this investment activity, GFI used the PitchBook Data platform to conduct a custom analysis of investments in U.S. plant-based meat, egg, and dairy companies, and cell-based meat companies across the globe.

GFI found that 2018 was a record year for investment in the nascent cell-based meat industry, with 12 cell-based meat companies raising capital worth $50 million in 14 deals. This was double the capital invested in 2015, 2016, and 2017 combined. At the end of 2018, a total of $73 million in capital had been invested since the field emerged as a commercial industry in 2015.

In 2018, 11 cell-based meat companies launched, bringing the total number of companies to publicly announce themselves to 27. The top three funded cell-based meat companies, Memphis Meats ($22 MM), CubiQ Foods ($14 MM), and Mosa Meat ($9 MM), have announced that they expect to start selling products in 2021. 
 
According to Nielsen data compiled by GFI, retail sales of plant-based meat grew 23% between 2017-2018 and exceeded $760 million, while total U.S. retail food sales grew just 2%.

The largest and most developed plant-based category is plant-based milk, which accounts for $1.8 billion in sales and represents 13% of the total U.S. retail milk market. Once plant-based meat reaches market share parity with plant-based milk, the market could be worth more than $10 billion. 

"With global demand for meat set to double by 2050, capturing even a fraction of this burgeoning market would represent a massive opportunity for both plant-based and cell-based meat companies," said GFI Director of Innovation Brad Barbera.

"These industries are accelerating rapidly, and we are about to see them take off. There is a great deal of momentum, which has been brought about by product innovation, greater emphasis on quality, more investment, and a change in consumer values," he said. "There is still so much growth possible, and there are great opportunities that come with that. Investors and entrepreneurs recognize the vast market opportunity on offer to get involved while these industries take form."

Consumer interest in cell-based meat is already strong, with a 2018 survey of 3,030 consumers finding that 30% of U.S. consumers, 59% of Chinese consumers, and 50% of Indian consumers were very or extremely likely to purchase cell-based meat regularly.