Five years after its founding, Clara Foods is making the big leap in 2020 from the lab to incorporating its technology into products that could soon appear on store shelves.
The California maker of chicken-free egg whites expects its ingredient to be used in protein drinks and supplements later this year, before Clara Foods launches an egg replacer in 2021 in products such as baked goods or egg scrambles.
"I don't think there has been a better time in history to be an ingredients company focused on developing animal-free products," Arturo Elizondo, Clara Foods' CEO, told Food Dive. "Ultimately for us, our No. 1 goal is to have the biggest impact possible, and we can do that by working with [food and beverage] companies who really want to stay on top of their game."
Elizondo said when Clara Foods was founded in 2015 there were only a handful of other animal-free companies in existence — including Beyond Meat, Impossible Foods and Perfect Day — and consumer demand for such products had yet to take hold like it has today. People doubted whether these companies could attract interest for their items outside of their San Francisco base, he said. As a result, CPGs had little incentive to incorporate foods produced using plants, cells or other new-age technologies into their offerings.
"We had to reach out to companies early on to see if they were interested in working with us, and now we're getting the inbound requests, having the big companies saying, 'Look, you know, the industry is moving very quickly, how do we catch up? How do we innovate? How do we make our products in line with what consumers want?'" Elizondo noted.
Along with answering whether animal-free on a bigger scale would be sustainable or little more than a fad, upstarts had to convince food and beverage manufacturers that their technology was something they would want to use and that if they did, that consumers would buy their products.
Elizondo said they also had to erase perceptions that it didn't taste good or lacked the flavors and functional attributes of its animal counterparts. Then there was the idea that it was expensive if the products were promoted as healthy, sustainable or ethical, which was not true.
"The big challenge we have in the food industry is how do we break that compromise," he said.
Clara Food's technology creates its egg white alternative using fermentation techniques similar to those used by beer companies and trendy upstarts such as Impossible Foods. Similar to the way brewers turn yeast into sugar or Impossible produces its signature heme protein using the microfungus, Clara takes yeast to create proteins that have the same genetic profile as what is found in an egg. This creates an ingredient that has the same texture, taste and functionality as its animal-based counterpart.
"I don't think there has been a better time in history to be an ingredients company focused on developing animal-free products. Ultimately for us, our No. 1 goal is to have the biggest impact possible, and we can do that by working with [food and beverage] companies who really want to stay on top of their game."
CEO, Clara Foods
For now, Elizondo said the company plans to continue working on other parts of the egg, even though the technology it uses could be incorporated into other proteins such as those found in dairy or meat.
"We focused on the egg white because that was an incredibly useful and functional ingredient," Elizondo said. "But ultimately the broad opportunity is in eggs" because many consumers turn to them for protein.
Clara Foods' work has attracted the interest of big players in the food and ingredients space. Last year, it closed on a $40 million funding deal. Investors included B37 — a strategic partner of bakery giant Grupo Bimbo — and Ingredion, which will work with Clara to develop, market and distribute highly functional protein ingredients.
Clara Foods is not the only company in the animal-free food space that has been toiling for years in the lab, but is now on the cusp of allowing consumers to see its products on shelves and menus.
Motif FoodWorks, which is working to recreate dairy, egg and meat proteins, has said it is on deck to get products to market in 2021. And nearly eight months after a limited-time offering of its own ice cream, animal-free dairy protein company Perfect Day is gearing up for a larger rollout — the first in a series of product launches in 2020 expected to eventually go beyond just the frozen treat.
"I think what has changed the most, by far, has been the belief in the space as a whole," Elizondo said, reflecting on his five years with Clara Foods. So many companies are "focused on developing animal-free products because the market has been proven."