The Brazilian startup Future Farm, (Fazenda Futuro, in Portuguese) recently launched its third plant-based product: chicken. More precisely, vegetable-based pieces that resemble the texture and tastes like chicken. This third launch comes with an ambitious plan to start operations in the U.S. market from January 2021.
Founded in April 2019, the food tech has already received two investment rounds. The latter, of BRL 115 million and led by BTG Pactual, Turin MFO and ENFINI Investments, evaluated the company at BRL 715 million and paved the way for new internationalization plans.
Using its English (Future Farm) and Spanish (Hacienda Futuro) brand versions, the startup is already present in Chile, Mexico, Uruguay, Sweden, and the United Arab Emirates, where sends products through distributors, and in the Netherlands, where it has its own office.
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In talks with LABS, Marcos Leta, founder of Future Farm, said that in 2021 the company should raise a new round to scale the business in the United States.
The American market for companies like Future Farm is gaining momentum. A market survey by Polaris, published last July, showed that the global plant-based meat market was valued at $11.1 billion in 2019 and, growing at an annual rate of 15.8%, is likely to be valued at $78.3 billion by 2027 (see the graph below).
Why? According to Polaris, this market growth is related to the increase of vegans and plant-based products, alongside consumer awareness of the nutritional benefits of a diet with less animal protein, and health concerns in general emphasized by the COVID-9 pandemic.
In the case of Future Farm, the target audience is far from vegans, though. According to Leta, 95% of those who consumes the startup’s products eat meat, which, according to the founder, could mean a change in the behavior of meat-eaters: the option of not eating meat every day.
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“The biggest category of food is meat and the way it is produced is very old-fashioned from a sustainable perspective, with animal sacrifice. We realized that with the population growing, with globalization and the increase in consumption in certain regions where before they didn’t consume meat, we can’t continue to feed in the same way. It would be unsustainable in the long run with the population growth. We don’t have a planet B”, said Leta.
For him, just as the financial and transport market has undergone a revolution, the food industry is been disrupted. “We started with the biggest market, the meat market. The idea of Future Farm was not to compete with or be a company for vegans. We set up Future Farm precisely to change the way the world eats meat,” he said.
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In Brazil, there is still a long way to go. In the next Future Farm’s market, the United States, the conventional meat industry is in a tailspin and the COVID-19 pandemic is one of the reasons for that, according to Polaris.
“Owing to the risk of infection and country-wise serious lockdown, then the meatpacking plants in the U.S. are closed. This closure has led to reduction in more than 25% of the meat production and disruption in the food supply,” points out the firm’s report.
As a result, the research points out that vegetable-based meat producers in the United States, such as Tyson Foods, Beyond Meats, and Impossible Foods took steps to increase their retail footprint. And it is precisely in retail that Future Farm intends to attack its rivals there.
To deal with the competition, Leta wants to reduce the price of the product on American soil. And he believes that Future Farm has an advantage regarding the gap in the food supply chain in the US: Future Farm’s products are made in Brazil, where the availability of inputs is great, which makes the product cheaper.
The following are the main excerpts from Leta’s interview with LABS.
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LABS – How is this new chicken product and how did you do it?
As the chicken has a different texture, when you compare the fibers of the meat and the fibers of a chicken you have a significant change in shape. We started to do a complete study of how we could texturize the vegetables so that we could extract these longer fibers. The product is a blend of non-GM soy with non-GM peas, which undergoes a physical industrial process to shape the vegetables. So we were able to extract these longer fibers.
Then comes the flavor part, we try to take as much of the plant-based flavor as possible and leave a more neutral flavor, close to the chicken, for people to season it and make the recipes they like best.
In chicken, we worked to cut fat, replicate, and even improve healthiness in comparison to the chicken of animal origin. And we did it. Of total fat, it has almost 6g, which is very low, and 0g of saturated fat. It does not have trans fat.
Besides that, we listen to customers asking us to test new types of packaging. We are doing a test with a package that uses 53% “green plastic” from sugar cane. We also try to evolve in this completely healthy and sustainable experience for our customers. This chicken product is the cheapest at Future Farm, with a value of BRL 15 ($2,68) to BRL 16 ($2,86).
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You will start operating in the American market, right? Are you hiring people over there? In the US, the competition will be more fierce than here in Brazil, right?
We have an office in the United States and we have already started to hire people. We will start sending products to the US in November but not to sell, but to do tests with the consumer, organize the distributors with which we already have a contract. The operation itself starts in January 2021.
The great challenge of the category in the world is to reduce the price to reach the value of meat of animal origin. That’s when we would have the migration, when we reached a sophistication in which the product is 100% similar to the meat and the price is the same.
In this case, there is no reason not to change, because we deliver much more sustainability and healthiness for an equal price of meat, without killing an animal and without spending the natural resources that are spent to produce a kilo of meat.
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Big names of plant-based have emerged as Impossible Foods, valued at $4 billion, Beyond Meat, which has quintupled its valuation since the IPO last year, and the Chilean NotCo. How do you see this competitive market?
I don’t see any plant-based as a competitor of mine. My rival is the slaughterhouse. Our focus is to make more and more butcher shops obsolete, educating consumers about plant-based benefits, and increasing technology so that we can reach that level where vegetable meat mimics the meat of animal origin.
In Brazil, it is a new category that came up with our launch. It still needs to be built, we have done a commercial work of education at the point of sale and a marketing work to explain the sustainable benefit to the consumer.
In the United States, the category is more mature, it’s already in another phase, and in Europe, it is in a moment of transition, from the hamburger that tastes like beans, to a plant-based meat that has this flavor similar to that of an animal origin.