If Beyond Meat’s ebullient post-IPO performance is any indication, everyone wants to have a piece of the plant-based, fast-growing sustainable food market.
Even Tyson Foods, America’s biggest meat producer. Behold: plant-based Tyson Foods nuggets are coming to frozen grocery stores near you this summer.
Tyson Foods announced its own plant-based offering a month after Beyond Meat’s IPO in May. Tyson initially backed Beyond Meat and then sold its stake a week before the listing.
Tyson Foods is not alone. Conagra Brands, Nestle and Restaurant Brands International, the parent company of Burger King, are also keen to jump on the sustainable food bandwagon.
Barclays estimates that the plant-based market may reach $140 billion in the next decade and private companies like Impossible Burger are looking to cater to this growing demand for the more environmentally conscious, meat alternatives.
“The changes are influencing the big companies,” says Shen Tong, founder and managing partner at FoodFutureCo. “They’re really trying to join the innovation, which is not the usual dynamic in a disruptive space. But these first- and second-tier companies are rushing to copycat, to do what we’re doing independently.”
New York-based FoodFutureCo is Tong’s second food accelerator, focusing entirely on social-impact companies. He says they regularly host delegations of first- and second-tier companies, who are closely watching the space. Friday is the deadline for their latest acceleration cycle, in which he aims to focus on companies looking to disrupt food supply chains.
‘Food Is the New Internet’
Tong calls the sustainable food industry the new Internet because it’s the “biggest value creation since the Internet revolution.”
In Tong’s vision, many of the companies emerging now in the food sustainability space will become the Amazons of the stock market in 18, 20 years from now.
Nobody wants to miss this. For many big food companies, their sales are declining and they’re looking to lure younger, more health-conscious consumers.
How Real Is the Demand?
The demand is growing so fast, even industry insiders are surprised by the pace of change.
“The breakneck advancement of plant-based food and beverages was easily the biggest surprise to our readership,” wrote Nicholas Fereday, senior analyst of consumer foods at RaboResearch, earlier this year.
And the big players like Tyson clearly see the shifts in consumer preferences.
Plant-based meat sales jumped 24% in 2018, compared to 6% a year before, according to Nielsen data.
While there is still some pushback from the meat industry and associations as well as cultural resistance to plant-based food, it’s clear that the big food players are taking note and taking this cultural wave seriously.
If even giant companies like Tyson are capable of making a shift, it could really move the needle and expedite the growth of the plant-based industry.
“This is just a beginning,” Tong says of investor appetite for meatless companies, both public and private. “It’s a tremendous amount of growth and it’s still largely underserved, and there is a value creation opportunity for investors.”