Two local plant-based meat brands have merged as consumer interest in the sector wanes, alongside venture capital interest in the sector.
All G Foods has spun out its Love Buds brand to joins vEEF by Fenn Foods to create a merged entity, the Aussie Plant Based Co.
The two brands bring same, same but different, to the faux meat table, both distributing the product range via Woolworths, with Love Buds producing plant-based mince, burgers, sausages, arancini and chicken nuggets, while vEEF’s frozen range spans imitation pulled pork and beef to brisket and steak, chicken pieces, burgers and schnitzels, and bacon bits.
All G Foods was founded by serial entrepreneur Jan Pacas, whose previous ventures include ASX-listed pet care marketplace Mad Paws and HR software venture Flare.
The Sydney-based alternative proteins startup raised A $16 million Seed round in 2021 from backers including the Clean Energy Innovation Fund, Ellerston Capital, and Andrews Meats CEO Peter Andrews. Then in early 2022, the Woolies VC fund, W23, tipped “a further multi-million injection of capital” into All G.
Another $25 million landed in August 2022 via UK agtech investor Agronomics, but by then the company was turning its focus to creating fermented “cow-free dairy” alternatives. At the time, the investment was flagged as the initial stage of a larger announcement in the following months with other investors, but no further announcements emerged.
Queensland chef Alejandro Cancino, who made his name at Brisbane restaurant Urbane. founded Fenn Foods in 2015. In early 2022, the startup raised $3 million to expand offshore.
The merger will see Pacas become chair of The Aussie Plant Based Co, with Cancino as CEO. The new venture has also added Bryan Zekulich, a partner at Fenn Foods investor Bombora to the board, along with angel investor, Rob Lederer, from the founding family of smallgoods manufacturer Primo.
Pacas said All G Foods will now focus its attention on developing its alternative dairy plans.
“The Aussie Plant Based Co aspires to lead the Australian industry with the broadest route to market, an enticing range of taste-first products, and our exceptional team,” he said.
“This strategic move will allow All G Foods to focus solely on being Australia’s leading biotech specialising in precision fermentation”.
Cancino said the collaboration has a shared commitment to more sustainable proteins.
“By combining our strengths, we can accelerate the adoption of plant-based alternatives and contribute to a greener planet and more ethical sources of protein,” he said.
But the merger is also part of what’s likely to be a consolidation in the sector as the funding and demand falls at the same time supply ramps up.
In the last five years fake meat became the new BNPL stampede as startups and investors flooded the market seeking similar success to Silicon Valley tech ventures Beyond Meat and Impossible Foods. Supermarket shelves are now awash with alt-meat products by rival companies such as Made with Plants, The Vegan Factor, Wildly Good, Next Gen and Why Meat Co, as well as the mushroom-based “braised beef” from Michael Fox’s Fable Food Co.
But sales over the past year have fallen by around a third, both here and in the US, even though the global plant-based meat market is predicted to deliver a 25% annual growth rate between now and 2030 from US$4.4 billion in value in 2022.
The sector’s initial peak came in 2021, when “simulated” chicken nuggets developed by teenage Australian Ben Pasternak landed $65 million series B for his New York startup, Nuggs.
Market leader, V2food, launched in 2019, as a joint venture between Hungry Jacks billionaire Jack Cowin and CSIRO, raised a staggering raised $185 million in total, but earlier this year changed strategy, cancelling its factory plans.
The Aussie Plant Based Co said its merger creates an extensive distribution network of 6,000 distribution points nationally, along with a manufacturing hub on the Sunshine Coast. The company now has plans expand into the Asian and Middle Eastern markets.