Piva Invests in Joywell Foods — — FoodTech’s Sweetest Alternative Protein
Today, we’re seeing incredible innovations driving the great industrial and energy transition forward — but perhaps one of the most impressive areas is in material innovation. This includes breakthrough chemistry and novel materials that have enormous potential to transform and drive sustainable consumer behaviors. Consider the impact of having alternatives to key materials our society has come to rely on that has proved detrimental — think fuel, coal, plastics, the production of meat and so on.
While plant-based meat and dairy has gained mass-popularity with companies such as Impossible Foods, Beyond Meat or Ripple — a lesser-known area that stands to make a big impact on health, the environment and the broader industrial production of materials — is the efficacy of alternative proteins to replace sugar and artificial sweeteners.
With this in mind, we’re excited to announce our latest investment in Joywell Foods (previously Miraculex), a California-based food tech company on a mission to reinvent the experience of everyday foods and eliminate the prevalence of sugar from our diets.
The Rise of FoodTech & the Socially Conscious Consumer
The FoodTech sector is heating up in everything from food delivery, no doubt exacerbated from stay-at-home orders during COVID-19, to bio-engineered foods. According to Pitchbook, FoodTech raised $5.7 billion in VC funding in Q1 of 2020 — with plant-based meat and dairy accounting for $569 million. Key drivers behind the alternative meat and dairy trend are an increasingly health, environmental and socially conscious consumer base that has grown to generally accept specialty proteins — hence the wildly popular Impossible Burger.
Similarly, we’ve long had a love-hate relationship with sugar for its association with weight-gain and obesity. Research also shows that overconsumption is linked to metabolic syndrome, including diabetes and heart disease — two of the leading causes of death worldwide. Yet, Americans still consume on average 17 teaspoons of sugar per day, or 57 pounds of added sugars annually.
The last innovations we’ve seen in the space was during the rise of artificial sweeteners dating back to 1897. While they appeased the sugar kick with a zero-calorie solution and cost savings — many of these synthetic substitutes have been questioned for safety, one being banned in the US (e.g., Cyclamate), or they simply don’t taste good.
Still, the advent of artificial sweeteners is an important stepping stone in new material innovation and demonstrated just how big the market potential is for sugar. Consider this: the Monsanto Company acquired G.D. Searle (the company behind aspartame — commonly known as NutraSweet, Equal or Canderel) — for a whopping $2.7 billion back in 1985. Today, the global industrial sugar market is predicted to reach $100 billion by 2022 with the global sugar substitute market expected to reach $10.3 billion by 2027.
Enter Joywell Foods — the Sweetest Innovator in New Materials
Joywell Foods is a FoodTech startup that takes a health-conscious approach to product development with their high-quality, natural protein sweeteners that are not only exponentially sweeter than sugar (about 1000x) but are not associated with long-term negative health implications (i.e., heart disease, diabetes, liver disease).
The company is led by a formidable leadership team combining top-notch commercial and technical experience with CEO Karen Huh, spending the last 15 years at the likes of Bulletproof and Starbucks Coffee and Co-founder and CTO Jason Ryder, offering tenured technical leadership and scale-up skills as an entrepreneurial chemical engineer.
The company, which started with miraculin — sourced from the miracle berry, is now developing several sweet fruit proteins that actually taste good and more similar to sugar compared to existing artificial substitutes. Through their proprietary technology platform, Joywell produces naturally sweet proteins using both plants and fermentation technology. The production process is significant in that it would reduce our reliance on massive sugarcane plantations — which largely contributes to pollution, industrial waste along with soil degradation and erosion.
“Piva’s investment will support the build-out of Joywell’s sweet fruit protein portfolio and offer consumers a delicious, yet healthy alternative to sugars and other sweeteners currently available,” said Huh.
“We are excited to work with Piva as we build out our technology platform and bring these sweet proteins to market.”
Joywell has seen considerable momentum within the last ten months — publishing a peer-reviewed toxicology study on miraculin, filing three provisional patent applications and commercializing the Pop Lolly — a first-to-market reduced sugar popsicle utilizing miraculin as a sweetener. We believe the company is poised to capitalize on the major consumer trends behind the FoodTech boom (e.g., health, natural ingredients, the environment) and has big potential to disrupt both the sugar and artificial sweetener markets.
Our Remote Investment in Joywell — The “New Normal” for Fundraising
Our investment in Joywell represents the “new normal” of startup fundraising being done 100% remotely. In venture capital, we always invest in the people just as much (if not more) than the company. This not only includes the leadership team but co-investors — who can be extremely instrumental in introducing startups to trusted investors in their networks (particularly when traditional networking and physical meetings are off the table).
While it can be difficult to evaluate chemistry between an investor and a founder or CEO remotely — the Joywell team made a lasting impression with a standout product demonstration and (delicious) samples coupled with a clear vision and flawless technical knowledge. Joywell was able to prove — via zoom — that they have true potential to be the next big innovator in materials.
We are thrilled to be investing alongside an excellent lineup of co-investors including Evolv Ventures, Khosla Ventures, SOSV, Alumni Ventures Group, Hemisphere Ventures, Mehta Ventures, Plug and Play Tech Center, IndieBio and working with the Joywell team as they introduce their sweet proteins to the masses and breakthrough the burgeoning FoodTech sector.