It would be simple to label NotCo as a company thriving in the plant-based food sector, operating in the United States and Latin America’s biggest markets, but it also wouldn’t tell the whole story. In a booming market expected to reach over $74.2 billion in 2027, according to Meticulous Research, the Chilean food tech startup has made its name with an innovative strategy: combining cooking, science, and AI.
Founded in 2015 by Matías Muchnick, Karim Pichara, and Pablo Zamora, the company is already valued at around $300 million, according to TechCrunch, and has attracted a star-studded list of backers such as Amazon‘s founder Jeff Bezos and Twitter co-founder Biz Stone in its investment rounds.
NotCo treats food production with a technology approach. Boasting culinary chefs, scientists, engineers, and designers among its 250 employees, the startup uses a complex algorithm to research ingredients and create plant-based food that tastes, smells, and looks just like its animal-based counterparts.
How NotCo started?
NotCo’s story begins in Santiago, Chile, when Muchnick quit his job in the financial sector to pursue a goal: disrupt the way food is produced. He started his quest by creating the Eggless Company, the first Chilean food company to develop and launch plant-based foods in traditionally animal-based categories.
Eventually, market conditions in Chile led Muchnick to create another project that took him to the University of California at Berkeley, where he took lessons in biochemistry and discovered that he could apply processes from the pharmaceutical industry into the food industry.
With that expertise, the executive went to Harvard, where he met his first partner: Karim Pichara, a doctor in Computer Science and expert in machine learning who developed algorithms for astronomers.
The last piece of the puzzle was put in place by the third co-founder, plant genomics expert Pablo Zamora, who could analyze several plants’ molecular structures. The result was Giuseppe, an algorithm named after a medieval artist who painted portraits with vegetables. This advanced AI can replicate animal-based food’s molecular pattern down to the smallest detail and is used to create food only with plant-based ingredients.
That technology has been applied to four products. The first and most famous is NotMayo, a mayonnaise made from chickpeas instead of eggs that became Chile’s third best-selling mayo brand in just one year, with a 10% market share.
In terms of resemblance to animal-based food, the algorithm paid off: “92% of those who consume it are not vegetarian. People don’t even realize the difference”, said Muchnick in an interview with BBC. NotCo has also developed plant-based versions of milk (NotMilk), ice cream (NotIceCream), and burgers (NotBurger) and already has substitutes for chicken, butter, and hazelnut chocolate spread jokingly nicknamed “NotElla” (in reference to Nutella) on its product roadmap.
NotCo funding trajectory
After the trio figured out the technology and production pipeline, the startup was established in Chile, and quickly rose interest from venture capital. The most prominent among them, obviously, is none other than Amazon founder Jeff Bezos, who took part in a $30 million funding round in early 2019 with his personal investment firm Bezos Expeditions. NotCo is his first investment in a South American company.
NotCo was also backed by Kaszek Ventures, The Craftory, Endeavor Catalyst, IndieBio, Humbolt Capital, and Maya Capital. In 2020, NotCo raised another $85 million in a Series C investment round, bringing on board new investors such as Twitter co-founder Biz Stone’s Future Positive, and venture capital firms General Catalyst and L Catterton Partners.
Expansion: NotCo goes big in Latin America and sets sights on the U.S. market
In 2019, the company started its expansion in Latin America, opening offices in Brazil and establishing a partnership with giant supermarket chain Pão de Açúcar, which exclusively sells NotCo’s products such as NotIceCream. In the same year, the startup also brought its products to Argentina, including NotMayo, NotMilk, and NotIceCream.
A year later, NotCo had a breakthrough in the fast-food market, announcing a partnership with Burger King to sell its traditional Whooper using the startup’s plant-based meat alternative. The burger, called Rebel Whopper, marked the first time Burger King made a bet on a Chilean food development company. According to TechCrunch, NotCo sells 48 sandwiches per store per day where it supplies its products.
In Brazil, the company opened up a delivery restaurant to launch its plant-based meat alternative. The restaurant, called Why Not, is available through delivery service iFood and sells burgers at BRL 25 and also has in its menu other NotCo products. In a fast expansion rate, the startup has already brought its products to Colombia and is planning to launch in Mexico and Canada in 2021.
After expanding to Latin America’s biggest markets, NotCo now sets its sights on the United States, where it expects to face tough competition with plant-based food tech stars such as Impossible Foods and Beyond Meat. The company opened a new office in New York and launched its NotMilk in the U.S. in a partnership with the Whole Foods supermarket chain last November.
But NotCo has an ace in its sleeve to become a household name in the U.S. This March, the company has been granted a patent for its food-making algorithm, which might make the Chilean startup a frontrunner in the plant-based food market. This year, NotCo has also joined Fast Company’s annual list of the World’s Most Innovative Companies, reaching the top 50 globally and ranking #1 in Latin America.
In its manifesto, the company says that “eating animal products harms our planet”, and has a mission to “take animals out of food production while never, ever compromising on taste”.
That may be true, but the company also has its sights on a market with huge potential. In 2019, the plant-based food market rose 11%, compared to a 2.2% increase in the traditional annual retail food market, according to a CB Insights research. The fast growth of demand in food alternatives for animal-based products has even raised concerns in the powerful meat industry. which is set to be worth $2.7 trillion by 2040