Alternative protein player Nature's Fynd gets $80m Series B

Previously known as Sustainable Bioproducts, the company rebranded to mark the start of commercial production at its new facility in Chicago. Nature’s Fynd appeals to investors because its protein requires far less capital and natural resources to develop than comparable plant-based products while offering greater versatility in end-use. The company will simultaneously roll out alternative meat and dairy products, as well as protein drinks and powders, targeting every meal.

"Nature's Fynd has developed tasty products across multiple food groups faster than any other foodtech company we have seen, with an elegant manufacturing process that will allow them to compete at 'Chindia prices' when at scale,” said Andrew Chung, a managing partner at 1955 Capital.

1955 is a cross-border private equity firm that invests in US and European companies with technologies relevant to Asia’s emerging markets. It contributed $15 million to Nature’s Fynd’s Series A early last year and remains the largest shareholder after re-upping in the Series B.

The new round was co-led by Generation Investment Management, a sustainable investment firm established by Al Gore, a former vice president of the US, and Breakthrough Energy Ventures, which is backed by Bill Gates, Jeff Bezos and Jack Ma, among others. Additional contributions came from Mousse Partners - an investment firm controlled by the Wertheimer family, which owns Chanel - ADM Ventures, and Danone Manifesto Ventures.

ADM Ventures and Danone Manifesto are the VC arms of food and agribusiness giants Archer Daniels Midland and Danone, respectively. They also took part in the Series A, alongside Breakthrough and several family offices, including some from Hong Kong.

Nature’s Fynd’s protein derives from microbes discovered in volcanic springs in Yellowstone National Park. These microbes can survive at extreme temperatures and the team secured initial funding from NASA to explore the possibility of producing food that could be used in space travel. This led to the development of a fermentation technology capable of growing protein with great nutritional value and minimal impact on the environment.

The arrival of CEO Thomas Jonas in 2014 led the company to refocus on terrestrial products. Nature’s Fynd discovered that its microbes functioned so well in difficult environments, when fermentation was carried out in normal conditions, the protein grew quickly and cost-efficiently. It is also a rare non-animal and non-plant complete protein, containing all nine essential amino acids.

Chung maps out the sustainable food space as three concentric circles with commodity pricing at the center. Start-ups pursuing stem-cell technologies are furthest away because they require massive scale for the economics to make sense. The next circle is occupied by those who recreate the functionality of meat using naturally occurring plant-based products. Beyond and Impossible are the highest-profile members of this fast-growing category.

Both companies have attracted significant private funding – with Beyond going public in the US last year – and both attach great importance to Asia as part of global expansion plans. However, Chung places Nature’s Fynd in the circle closest to the center, pointing to advantages on cost and breadth of application.

“Impossible extracts proteins from plants and then adds a synthetically created patty. It took them $100 million in R&D to create that patty and it’s good,” he said. “The Nature’s Fynd microbe grows into a material that looks feels a lot like raw meat. By varying the particle size and controlling how the microbe develops, they can get into a wider set of products much more quickly.”

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• 1955 Capital