Q1 2018: The State of FoodTech

Where the future of food stands today.

We are in a “new normal” for agrifood tech funding. Investment in the nutrition biotech and agtech space shot up more than 1200 percent between 2014 and 2017, with a strong surge in investment volume in the past year alone (29%), despite a significant drop in the number of total deals.

This has shaped a landscape where seed funding is more difficult to come by, but massive rounds seem to be making headlines daily.

(We’re grateful for all of those who see the future the way we do and are helping to support food-system innovators!)

If Q1 is at all representative of the future, the increase in funds dedicated to food innovation is set to continue. At New Crop Capital, we’re particularly interested in the deals with an impact on the future of animal agriculture and protein production.

With the rise of plant-based replacements for conventionally produced animal products and the impending market entry of clean meat (animal meat without slaughter), we see major disruption ahead.

image credit: Laura Zaim

A report released in February by FAIRR, an investor coalition representing more than $4T in assets, echoed our feelings, calling for companies to de-risk by diversifying into alternative proteins and preparing themselves for the market entry of clean meat.

FAIRR identified four key drivers leading markets away from factory farming and toward better alternatives:

Growing market opportunity to meet demand for plant-based foods
Accelerated innovation in food technology
Increasing awareness of ESG impacts linked to intensive livestock production
Advocacy and regulation to moderate growth in the animal protein sector

Here’s what this actually looked like in Q1, in terms of…


Cow-free dairy company Perfect Day Foods raked in a $24.7M Series A led by Singapore state-owned investment firm Temasek. Perfect Day also secured its first patent to produce dairy recombinantly (i.e., by using microbes to ferment out dairy proteins, instead of impregnating cows to produce milk).

Tyson joined Cargill, Bill Gates, DFJ, Richard Branson (and New Crop Capital) in investing in Bay Area clean meat startup Memphis Meats, which has a multi-species platform to grow animal meat from cells — removing the risks, inefficiencies, and ethical quandaries inherent in breeding, feeding, and processing an entire animal.

Sorry Elon. Memphis Meats wins the “hottest tech” prize.

PHW-Gruppe, one of Europe’s largest poultry producers, joined New Crop Capital in a $3M seed round for Israeli clean meat startup SuperMeat.

Pea-protein milk startup Ripple Foods Inc. raised $65M from Euclidean, Goldman Sachs, Khosla, Fall Line, and S2G.

Fund Activity

Kraft Heinz launched Springboard Brands, a VC arm designed to keep up with the rapid pace of food innovation. In addition to seeking new external opportunities for accelerating and investing in startups, Springboard has already evaluated its in-house brands for reinvention and tapped the plant-based Boca burger as its first project.

Anterra Capital became the largest single dedicated agtech fund in the world by extending its first fund to $200M.


In its fastest nationwide launch ever, TGI Fridays rolled out the Beyond Burger in all U.S. locations

Beyond Meat then launched a sausage product which is now being sold in retail and foodservice nationwide (and in Yankee stadium)

Tyson launched its own 100% plant-based brand, Green Street, to own a bigger piece of the escalating demand for plant-based alternatives to animal protein sources.

Across the pond, Tesco became the largest plant-pusher in the UK by launching the plant-based heat-and-eat Wicked Kitchen line across 600 stores.


As the poultry industry* embraces the clean meat future (see Cargill, Tyson, and PHW’s investments above), the beef industry is resisting with petitions targeting the plant-based and clean meat industries on the regulatory front.

*The consolidation of the poultry industry lends itself to this pivot, whereas livestock production is much more dispersed, making mass adaptation more difficult.

  • The US Cattlemen’s Association is asking the USDA to limit the definition of meat to exclude plant-based and clean meat.
  • The National Cattlemen’s Beef Association is taking a more nuanced approach, submitting a letter recommending that clean meat fall under USDA inspection (a difficult ask, since the USDA evaluates meat at the point of slaughter, which is not a part of the clean meat process).
  • Congress, not the USDA, establishes jurisdiction, but we digress…
  • Since there is no slaughter, and the cells that grow clean meat are produced in a nutrient mixture that could be considered as a food additive, the FDA may play a role in regulation.

For its part, the FDA remains cooperative and optimistic:

“I encourage you to work with FDA, to bring your brainpower and imagination to the challenge of feeding the world, helping people have healthier diets, and providing innovative new options for consumers.”
–Director of the FDA’s Center for Food Safety and Applied Nutrition Susan Mayne at the Future-Food Tech Conference in March 2018, where New Crop Capital spoke on a panel about (among other things) clean meat.

The livestock industry’s acknowledgment of the threat that plant-based and clean meat could pose, coupled with the ever-growing number of investments in the space, strongly reinforces our bullishness about the radical growth potential of this once obscure market.

And given the undeniable food safety benefits (“clean” isn’t just a name) and economic efficiencies of removing animals from the meat-production process, regulatory bodies are highly motivated to support a streamlined path for clean meat.

We’re in the midst of a fundamental shift away from conventional meat production and toward alternatives that pose less material risk to investors and less existential risk to people and the planet.

Bring it on.

Visit us at newcropcapital.com for details on our fund and investments.