No Meat Factory raises $42M to expand plant-based protein manufacturing

Dive Brief:

• Plant-based meat manufacturing company No Meat Factory raised $42 million in a Series B round. The round was led by Tengelmann Growth Partners and Emil Capital Partners, who invested when the company was formed in 2019.
• These funds will help No Meat Factory expand its manufacturing footprint in North America, as well as increase its R&D. Its current manufacturing facility is in British Columbia, Canada, and a second facility is scheduled to go into operation this year.
• While the plant-based meat sector is poised to continue to grow, a lack of manufacturing facilities can be an obstacle. According to a study last year from the Good Food Institute, $27 billion worth of manufacturing infrastructure is needed to meet plant-based protein demand by 2030.

Dive Insight:

Companies can create all of the plant-based meat prototypes they want to, but without someone and somewhere to make them, consumers will never be able to buy them.

As the segment pushes more growth, entities like No Meat Factory become as important as the branded entities that are designing the products. More manufacturing capacity means more products — which trickles down to companies being able to get closer to reaching price parity with traditional meat. 

No Meat Factory was co-founded by plant-based protein veterans Dieter Thiem and Leon Bell. Thiem, No Meat Factory’s CEO, has worked with many food startups for more than four decades, including Gardein precursor Flora Protein. Bell, the COO, worked at Archer Daniels Midland in R&D and sales. He served as the protein giant’s national sales manager, promoting ADM’s plant-based ingredients across North America.

Expertise and trends have gone hand-in-hand to help the manufacturing company grow, leaders said. The connections that the founding team has in the protein industry also is useful to help smaller companies forge relationships with suppliers.

“The traction No Meat Factory has experienced in just a few short years is evidence that consumers want greater access to plant-based alternative proteins and brands are looking for ways to deliver quality at an affordable price,” Thiem said in the statement announcing the funding.

Right now, No Meat Factory only manufactures products for other companies, though the company said it is looking at more private label and foodservice business in the future.

Manufacturing has proven critical for plant-based meat companies in the past, and as more players are scaling up, it will become much more vital. In their early days, category giants Beyond Meat and Impossible Foods both faced manufacturing challenges. As Impossible Burgers got to be more popular foodservice items in 2019, the lack of capacity caused shortages and frustrated restaurants. Beyond Meat also grew to a point where it quickly needed manufacturing capacity increases in 2018.