Meati Foods remains confident of achieving its $1bn sales target by 2025 despite the slowing demand for alternative-protein products in the US.
The Boulder, Colorado-based business, which has just received an undisclosed top-up to July’s $150m Series C funding round, has launched a direct-to-consumer service to add to its retail listings in Sprouts, Whole Foods Market and Meijer.
Meati Foods’ four-strong range of mycelium-based meat-free products – chicken breast, breaded chicken cutlets, steak and a seasoned carne asada steak – are also available in “a couple of thousand foodservice locations”, co-founder and CEO Tyler Huggins said.
“We see no lack of demand at all. We for sure have a billion dollars of interest,” Huggins explained when asked by Just Food on the achievability of the $1bn goal put forward by president Scott Tassani last year.
“We continue to build out our commercial platform as rapidly as we possibly can and are setting ourselves up for unprecedented growth. We’re being as aggressive as we possibly can.”
Meati Foods announced job cuts in June but Huggins was coy in providing further information.
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He countered: “We’ve set very ambitious and mission-driven goals. That path is a winding path. In the early days, it was all about speed, growth and getting to market and getting product out there in a substantial way and we’ve achieved that. We’re making difficult calls now to establish a sustainable business model.”
Huggins claimed taste is the primary reason Meati Foods stands out from the crowd as the overall category sees sales growth slow. The co-founder, who set up the business in 2019 with Justin Whiteley, pointed to the products’ nutritional profile – 95% to 97% mushroom root or mycelium – and their texture.
“It just shows you that the demand is there, the market is there. People want alternatives. They want diversity in their diet. It’s just got to be good tasting and it’s got to be real whole food,” he said.
“We’re not out there saying you’ve got to remove animals from the supply chain. We’re saying, yes, we believe in a regenerative, sustainable ethical food system for sure. But we also believe in diversity in our food system that includes both animals and non-animal-based products.”
Meati Foods, which operates out of a so-called ‘mega ranch’ in Thornton, Colorado, including in-house mycelium production, is “expanding pretty rapidly” in retail, with the business split around 60-40 between bricks and mortar and foodservice, Huggins confirms.
“We recently launched a D2C platform, which is a great way to get product out there and see what people will like,” he said. “And then, from there, if we find one SKU works really well, we can roll that out through foodservice and retail.
The Thornton site can accommodate further manufacturing expansion and is operating at a run rate of “tens of millions of pounds of product”, Huggins explained.
“Our goal has always been impact and that requires scale. We went for it and it’s been paying off,” he added.
For now, Meati Foods remains focused on the US despite international interest with a key requisite of offering value to the consumer.
“We just provide such nutrient density. I would argue we are a great value and a great price comparison,” Huggins said when asked how the business positions on price to real meat.
“We’re a whole new category of meat that provides you with a much better nutritional profile than anything else out there in the market. And dollar to dollar, you get better nutrition.”
Meati Foods will use the new funding to try to foster further growth and expansion, along with entering new retail and foodservice partnerships. Last year, the company’s total external capital injection was $228m before the addition to the Series C financing.
“We’re definitely on a rapid ramp right now and just continue to support that growth,” Huggins said.