- Banza, a pasta made from chickpeas, raised $20 million in funding from Enlightened Hospitality Investments and Prelude Growth Partners. The investment will be used to expand Banza’s personnel, supply chain, marketing and product offerings.
- Banza is the fastest growing pasta brand in the U.S., and it is planning to broaden its reach by moving into the food service market beginning in 2020, reported Food Navigator.
- The brand was launched in 2014 with the mission of reformulating food made with wheat, corn and rice. It uses chickpeas because of their sustainability and nutritional content. Banza pasta has nearly double the protein, three times the fiber and a third fewer net carbs than traditional pasta.
Pasta is one of those traditional comfort foods that in recent years has been left on the shelf by consumers who favor better-for-you products with functional ingredients. Dry pasta traditionally made from wheat saw the dollar amount of sales slip 0.5% in the 52 weeks ended Feb. 24. Likewise, overall unit sales were down 0.9% compared to the same period a year ago.
At the same time, Euromonitor data indicates global consumption of gluten-free and organic pastas is on the rise. Part of that transition in market share is consumer concern about carbohydrates having a negative impact on their health. According to Mintel, 41% of U.S. consumers view rice and other grains as being healthier than pasta.
Still, pasta is a tempting dish and consumers are opting for alternatives rather than forgoing it completely. Although Banza has benefited from this demand and has grown at a rapid clip — expanding from 1,700 stores in 2015 to more than 12,000 in 2019 — it is not the only pasta alternative on the market. Barilla, the largest pasta company in the world according to Forbes, recently debuted products featuring chickpeas and red lentils instead of wheat. Other alternatives include pasta made from cauliflower, lentils and peas from VeggieCraft Farms and high-protein black bean noodles from a variety of purveyors. Green Giant and Del Monte have also gotten into the game and now sell spiralzed vegetable pasta-like products.
Even Banza’s debut into the rice segment earlier this year will not get the brand out of competitive territory. Competitor RightRice just launched a vegetable rice consisting of more than 90% lentils, chickpeas and green peas and 10% rice, Food Navigator reported.
The competition for alternative grain-based products shows their popularity and explains why investors are so interested in funding Banza. This funding round marks the company's largest since its founding five years ago. In 2015, the company received a total of $1.3 million from different investors. It raised $7.5 million in a Series A round in 2017.
Chickpeas are a particularly appealing substitute for grains because they can mimic the taste and functionality of premium wheat flour but are far higher in protein content. The popularity of chickpeas has helped the legume expand into the snacking category as well as the baking aisle in the form of flour and protein powder. In order to increase the nutrient profile of products, chickpeas have been included in chips, puffs and even craft mustard.
Banza is looking further than the grocery store with this new infusion of cash. Food Navigator reported the company hopes to branch into food service next year — a sensible step, given Enlightened Hospitality Investments, which founded Shake Shack and runs Gramercy Tavern and Union Square Café, led the latest investment round.
Food service opens up a whole new world for Banza, not to mention consumers who are looking for gluten-free or low carb options as a pasta alternative. The brand may find success starting in more health-conscious restaurants or places like hospitals where strict diets are followed. However, Banza wants to be seen as mainstream and not a second-tier alternative to traditional pasta, so it is likely that the company will look to enter mainstream restaurants like the ones in Enlightened Hospitality Investments' portfolio.
If customers are as eager for high-protein, low-carb options when they eat out as they are when they eat at home, Banza has a good shot of rising to the top.