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“This mega-trend in health and wellness and sustainable food production was really emerging.”
Mr Foss said a barrier to the mainstream population in plant-based eating previously was the taste and texture of products – which was now changing due to technology.
“That’s really what we focused on very heavily the last four or five years before we launched Fancy Plants – how do we use plant-based techniques and technology to be able to create dairy alternatives that are as good or better than the dairy products?” he said.
Credit Suisse said in a report last year “a shift toward a more plant-based diet appears inevitable” and estimated the market for alternative meat and dairy products could grow from $US14 billion ($19 billion) today to $US1.4 trillion by 2050.
Mr Foss noted corporate investment in the sector was driven by consumers’ shifting diets to “flexitarians”.
In 2021, Kraft Heinz and NotCo, a Chilean plant-based food company, announced a joint venture to disrupt “plant-based dairy and meat”.
Venture capital investors pumped $51.7 billion into AgriFoodTech – an 85 per cent increase over 2020 – to serve consumers’ changing diets from dwindling natural resources, the AgFunder report says.
Australian fast-food king and Rich Lister Jack Cowin and CSIRO’s Main Sequence backed v2food – a plant-based “meat” start-up – last year and brought in a large European investor in a $72 million capital raising to accelerate an offshore push into China and Europe.
Revolutionising the industry
Supermarket giant Woolworths made its second bet on a local plant-based meat start-up, All G Foods, in February.
Fast-food chain McDonald’s is also expanding its vegan options and Pizza Hut Australia is introducing a plant-based meat alternative.
However, it is the smaller businesses that truly are revolutionising the industry with advanced technology and innovative ingredients, such as Fable’s “mushroom meat” in 2019.
Fancy Plants creates snacks that replicate dairy through an advanced stabilising system. Last year the group generated about $2.5 million in sales.
“We see this whole chilled plant-based snacking space to be a real growth category. And currently yoghurt is $1.8 billion in Australia, and just 1 per cent of that is plant-based,” Mr Foss said.
He expects to double sales every year to reach $40 million to $50 million in revenue by 2025.
It is not just about top-line sales growth, but loyalty and repeat purchases: “We’ve got the highest loyalty rates and repeat purchase in the category,” he said.
Mr Foss is also seeking to improve Fancy Plants’ sustainability credentials and hoping to become B Corporation certified soon. The group partners with 1 per cent for the Planet, which donates 1 per cent of sales to back high-impact, not-for-profit social and environmental groups.
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