With the COVID-19 crisis yet to be tackled, VCs are exercising cautious optimism which in turn has slowed down startup funding. Only exceptional startups operating in a handful of sectors, not affected by the crisis, have been able to raise capital.
This is where Singapore-based Next Gen’s financing gains prominence. This 4-month-old plant-based meat startup has achieved what many of its peers could not — a US$10 million in seed funding round from the likes of Temasek, K3 Ventures, the New Ventures arm of the Singapore EDB, NX Food, FEBE Ventures, and Blue Horizon.
Co-founded by Timo Recker (founder and ex-CEO of German plant-based meat company LikeMeat) and Andre Menezes (ex-GM of Country Foods Singapore), Next Gen is currently on track to bring its first product into the market and has already bagged partnerships with a few restaurant brands in the island nation.
On the occasion of Next Gen’s fundraise, e27 sat with its COO Menezes to discuss the investment, the firm’s plans, and the overall plant-based meat industry in Southeast Asia.
Edited excerpts below:
Next Gen is just four months old and has already raised US$10 million. How did you convince your investors to back you?
We consider ourselves blessed that the world and investors are becoming more aware of the importance of transforming our food system.
Although Next Gen was only established in 2020, the leadership team is very experienced in the plant-based meat industry and in global brand building.
Also Read: No animals were harmed in the making of this ‘meat’ burger
Our asset-lite business model also allows us to operate remotely and digitally, facilitating scaling our business quickly, first in Singapore, then Asia and international markets.
Our R&D team also developed TiNDLE (a plant-based chicken consumer brand) with chefs and for chefs. It is unique and highly versatile, delivering the taste, texture and experience of chicken. TiNDLE Thy is very delicious and unique, offering authentic chicken taste, texture, and aroma, and is different from anything else out there.
These factors have played a key role in high investor interest.
For a six-month-old company, US$10 million is a massive money. Why does the company need this much capital? How and where does the company plan to deploy the capital?
Our seed round was oversubscribed, and we had to expand the round to accommodate great investors who were interested and are very important for our business. We are building a global brand, which requires resources.
Our ambition is to expand quickly across multiple markets and to keep investing in the development of better technologies and products. As such, the funds are adequate to support our business plan and will be used for the global launch of TiNDLE in Singapore, expansion into additional Asian cities, and continued research and development of new plant-based products.
There are now a handful of companies in Southeast Asia providing plant-based meat. How do you stand out from them?
We do see other companies around the globe emerging recently and we are very happy that the category is being developed as we will all benefit from a more sustainable food system.
Next Gen offers a new and differentiated product. TiNDLE Thy is very delicious and unique, offering authentic chicken taste, texture and aroma. Our business model and our experienced leadership team are also key differentiating factors.
We are confident that TiNDLE and our future brands will win the hearts of consumers in Singapore, Asia and around the world.
As per a statement, Next Gen is planning to expand into Europe and the US. What opportunities do you see in these markets?
From day one, we were very clear that Next Gen’s business is global. Being asset-lite and also tapping on digital allows us to scale and expand quickly to almost any market.
Also Read: Next Gen raises US$10M in one of the largest seed rounds
Today, the US and Europe are the main markets for plant-based foods and – as such – are extremely relevant in our expansion plans. We notice that most of our consumers today are living in and around urban centres, therefore we will have a strategy focused around the most relevant cities in each region or country.
How is the plant-based meat/alternative protein market growing in Singapore as well as the entire SEA region? What trends do you see in the region?
Plant-based meat has seen strong demand in the West and is now also gaining momentum in Asia. According to DuPont N&B, demand for plant-based products in Asia will surge over 200 per cent in the next five years.
As much as 78 per cent of APAC consumers say that plant-based meat alternatives are here to stay, and consumption will continue to grow.
Technavio projects the market will be worth US$12.75 billion by 2030.
How did the COVID-19 pandemic affect the plant-based meat industry?
The pandemic accelerated awareness among consumers and investors of the issues and risks associated with animal farming. That, in turn, has driven additional momentum into the plant-based industry across all metrics — from funding to consumer awareness and demand.
Global investment in foodtech for the first three quarters of 2020 was US$8.37 billion, beating the US$7 billion raised in 2019.
Where do you source the ‘raw materials’ for your ‘meat’ products?
Our raw materials are sourced globally, considered the best-in-class source for each component available. On that, for example, we have opted not to work with GMO ingredients or novel ingredients.
Can you share more details about TiNDLE? How many restaurants have you partnered with to sell this brand? Can you share the names?
Next Gen’s consumer brand TiNDLE will be making its global debut in Singapore in March 2021. Distributed by Classic Fine Foods, Next Gen’s official distribution partner, it will be rolled out in select restaurants including Three Buns Quayside, The Prive Group, 28 Hong Kong Street and The Goodburger among others.
Also Read: Conscious consumption is driving the trend in foodtech: Study
Developed in collaboration with chefs and for chefs, the first TiNDLE product is TiNDLE Thy, delivering the unmistakable taste and versatility of chicken thigh. Chefs can easily use TiNDLE Thy to prepare dishes in multiple culinary applications, and for many kinds of cuisines – Western, Chinese, Indian, Middle Eastern and more.
Do you focus both on B2B and B2C markets with the TiNDLE product line?
TiNDLE Thy launches exclusively with restaurants as it was developed with chefs and for chefs. It will be launched in select restaurants across Singapore.
We want consumers to understand that great experiences do not necessarily need to involve animal farming. In the future, as part of our roadmap, TiNDLE products will be available for sale at supermarkets.
Which other SEA markets are there on your TiNDLE roadmap? In which country do you see prospects for your product after Singapore?
This year, we will be expanding to multiple countries in Asia. Next Gen will be launching in urban, highly developed and regionally well-connected cities in Asia.
In the next two years, we aim to expand to Europe and the US. We are already laying the groundwork for the US, including recruiting a Growth Director, who will build a network of distributors, restaurants, and chefs.
Do you see the global demand for alternative protein products, especially vegan products, to go up globally? What are the factors influencing this growth?
Global demand is rising significantly, driven mostly by Flexitarians. The main factors driving consumers around the globe to reduce their animal-based diet in favour of more plant-based products are sustainability and health.
It is important to note that some myths are now debunked, for example, plant-based foods taste like cardboard or that you cannot have all the nutrients if you reduce the consumption of animal protein.
Our TiNDLE Thy meets the nutritional guidelines for the Healthier Choice Symbol administered by Singapore’s Health Promotion Board due to its lower sodium and lower saturated fat content as compared to regular plant-based meat alternatives.
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Image Credit: Next Gen
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