Supermarket giant Woolworths has made its second bet on a local plant-based meat start-up, this time investing in All G Foods.
The alternative proteins business, which was founded by serial entrepreneur Jan Pacas of pet care services marketplace Mad Paw and human resources software company Flare, is behind the Love Buds range of products on supermarket shelves and in restaurants.
Its latest multimillion-dollar capital injection comes from W23, the venture capital arm of the $41.5 billion supermarket chain, and was described as an extension to All G Food’s $16 million seed round from September last year.
“At W23, we invest in innovative start-ups led by visionary founders, and we’re interested in backing the next wave of food innovation in Australia,” W23 managing director Ingrid Maes said.
“All G Foods is at the forefront of new alternative protein production techniques and is setting out to build a global business that can help feed a growing population. We’re excited about the potential of All G Foods’ emerging technology and ambitious growth plans.”
It is the second investment by Woolworths in plant-based meats, having invested in ingredients manufacturer Harvest B, which develops alternative proteins for use by other brands.
As well as plant-based meat, All G Foods is believed to be the first local business to use a process known as precision fermentation to develop dairy proteins that can be used to create products that look and taste the same as milk, but without the cows or associated negative environmental effects.
Precision fermentation enables the programming of micro-organisms to produce complex organic molecules, such as protein.
Milk is made up roughly of 96 per cent water, 3.5 per cent protein and 0.5 per cent fat. All G Foods’ process replicates the proteins that are responsible for the taste and appearance of the product, but uses a fraction of the water and land for production. It is also lactose-free.
The company now makes its experimental non-cow milk product at its biofoundry in Sydney, but Mr Pacas said there were plans to scale up production in the next few years.
“We’re still a long way from producing it at scale because there are regulatory challenges and scalability challenges to overcome,” he told The Australian Financial Review.
“In 12 to 18 months, we will build a pilot plant. And in two to three years – and we’re already in discussions with state governments about this – we’ll build a big precision fermentation facility that we can scale to supply products to the world.”
Woolworths created its venture arm, W23, in 2019 to help the supermarket get exposure to innovations and technologies. It has also backed Marketplacer, Samsara and digital health technology company Eucalyptus.
“There’s a great attraction to work with Woolies because they’re an innovative company with great distribution capabilities,” Mr Pacas said. “They’re the dream partner.”
Other All G Foods investors from the initial round last year include the Clean Energy Finance Corporation, Ellerston Capital, Singapore-based private equity firm Triple Star Capital, Our Innovation Fund founders David Shein and Geoff Levi, Monash Capital and Andrews Meats CEO Peter Andrews.
All G’s Love Buds burger patties are stocked in more than 300 retail outlets.
It is also developing plant-based chicken, mince, sausages, nuggets and bacon alternatives as part of its first batch of products, which will roll out in stores over the next few months.
“I want to make this bigger than A2 Milk was at its peak,” Mr Pacas said.
“If you take a decade-long view, (the alternative protein market) will be 20 to 30 times the size.
“But we’re not positioning ourselves as against meat. We’re running out of land, and cows. The world needs to produce more food in the next 30 years than it has in the entire history of humanity.”
Extracted from AFR