- Meal kit company Purple Carrot just launched The Garden Incubator, an early-stage startup program for plant-based products. Venture capital firm Unovis Partners is also providing funding for this program through its New Crop Capital fund.
- Participating startups will get support in strategy, branding, marketing, e-commerce, operations, fulfillment and data analytics. Additionally, some companies will receive up to $250,000 in seed funding.
- The Garden Incubator will be an investor, an incubator and a launchpad for companies looking to expand and raise awareness for future investment and growth, the release from Purple Carrot states.
With consumers pushing for both healthier and more sustainable diets, the plant-based space is primed for continued growth. Projections show an increase in the plant-based protein and meat alternative categories from $4.6 billion in 2018 to a whopping $85 billion in 2030, according to investment firm UBS. Seeing this growth, legacy companies and investors have poured money into the space. Given the plant-based meal kit company's mission, it's not surprising Purple Carrot would want to incubate brands that have this potential for disruption.
As interest in the space expands, startups are vying for the attention of the big companies that can help scale their products and bring them national attention. The Garden Incubator intends to help them do that. Nosh reported the incubator’s strategy will be informed by data received from its meal kit customers about what kind of plant-based products consumers want. The company will then work through its incubator with six to 10 brands filling that need by tailoring the type of mentorship provided to each.
That mentorship could mean establishing direct-to-consumer distribution or assisting in coordinating supplier agreements. Part of the incubator’s assistance will come in the form of funding. However, according to the release, only companies that meet the required New Crop Capital mandate and criteria will be eligible for funding. Those who do receive the funding will have a leg up on their competitors and be able to put it toward increasing marketing activities or distribution — both tactics that can help burgeoning companies find space on an increasingly crowded shelf.
Investing in the plant-based segment is a part of a larger trend. This past September alone, Tyson invested in plant-based shrimp maker New Wave Foods, Hormel launched Happy Little Plants branded soy-based protein and Kroger launched its plant-based private label collection. As more big names launch their own brands and look to invest in others, this new incubator could be a space to find who's up and coming.
Although The Garden Incubator has yet to make any investments, it has competition for plant-based startups. Many large food and beverage companies have their own accelerators to help boost the next big brands. Several of these zero in on plant-based alternatives. Land O'Lakes has an incubator dedicated to investing in alternative dairy product startups struggling to reach scale. PepsiCo's Nutrition Greenhouse program looks for participants in the better-for-you space. In its 2018 U.S.-based cohort, it took on plant-based functional beverage maker Remedy Organics, and California-based plant-based seafood alternatives maker Sophie's Kitchen. Mars Wrigley has an accelerator program called Seeds of Change, which looks for food brands focused on plant-based eating.
The continued growth of the plant-based space — sales climbed 42% between March 2016 and March 2019, when they reached $888 million, according to Nielsen data — also poses a potential challenge. With supermarkets, restaurants and home kitchens becoming inundated with new offerings, food manufacturers are inevitably preparing for the fact that not every product will capture a coveted place on the shelf.
The Garden Incubator, however, has the advantage of being affiliated with a meal kit company. With that relationship, class members of the incubator can run tests on a captive consumer base to gain feedback and data on their products. And Purple Carrot, which was bought by Japanese e-grocer Oisix ra daichi for $12.8 million this spring, will likely benefit from such a relationship as it will keep its offerings continually fresh and engaging for consumers looking for interesting products delivered to their door.