With an $18 million funding round and the approaching launch of New Wave Foods' long-awaited plant-based seafood products in foodservice, co-founder and Chief Technology Officer Michelle Wolf said 2021 is the year of the shrimp.
New Wave Foods, which started in 2015 to produce plant-based alternatives in the seafood segment, has spent the last year gearing up for the nationwide launch of its shrimp product. Its first shipment to a foodservice distributor is later this month, and Wolf said products should begin appearing on menus in the first quarter of 2021.
There is tremendous opportunity for plant-based shrimp, Wolf said. The crustacean is the most consumed seafood item in U.S. restaurants, but there are sustainability issues in producing it. Additionally, about 90% of the shrimp eaten in the United States is imported.
"From an opportunity standpoint, and then also from a real tangible problem that we could solve, we went after shrimp as the first product," Wolf said. "At the time when I started the company back in 2015, Beyond Meat and Impossible Foods were starting to gain a lot of traction within the market, and no one was looking at seafood. There was just this huge opportunity."
New Wave Foods has generated a lot of buzz since the company first came on the scene, attracting the attention of Big Food and funders. The $18 million Series A funding round brings total funding for the company to $20.3 million, according to Crunchbase. It was led by New Enterprise Associates and Evolution VC Partners, both new backers of the company. Tyson Ventures, the financing arm of the meat giant, has been a backer of New Wave since 2019.
Wolf said the company will use the new funding to help push an aggressive rollout, as well as to develop new line extensions. The first product will be plain plant-based shrimp, but New Wave plans to get breaded and sauced varieties on the market by the end of the year. The funds will also help it develop new plant-based seafood products that look and taste like lobster, crab and scallops.
Several restaurants across the U.S., including some chains, are interested in serving New Wave's seaweed-based shrimp to their diners, which is why New Wave has focused on being able to roll out a significant amount of product, Wolf said. The company served more than 8,000 samples at the 2019 National Restaurant Association show, and thousands more since then to prospective clients and investors.
Developing a plant-based shrimp product has been a challenge, Wolf said. The texture, bite and mouthfeel of shrimp is a big part of the experience of eating it, and New Wave spent a lot of time and R&D to replicate that experience. Getting the distinct taste of shrimp was also key. Wolf said the company worked with a master chef to help develop the product.
"We always have our North Star of making sure this product would delight consumers," Wolf said. "It's all about replicating shrimp with this unique, kind of nuanced texture, but also making sure it's going to be delightful to consumers, ultimately."
In addition to the uniqueness of a plant-based product that mimics the taste and feel of shellfish, New Wave's offerings are able to offer something most plant-based meat does not: price parity with conventional shrimp. At wholesale, New Wave's products will have a similar cost to premium shrimp. Wolf said the company's primary goal was to replicate the taste and experience of shrimp — not necessarily to try to price itself similarly. However, a deep understanding of the market for seafood at foodservice and the target consumer helped it develop the product to an appropriate price.
At this point, New Wave has no plans to expand its products to the retail sector, Wolf said. Trends show that most seafood is eaten in foodservice settings, and Wolf said it makes sense to launch to an audience that is already looking for the company's products. Depending on how business at foodservice and future R&D efforts go, retail products may come in future years, she said.
Going forward, Wolf said New Wave is ready to make a splash — both in the plant-based sector and foodservice. The COVID-19 vaccine's potential to end pandemic-related dining shutdowns may herald new business for restaurants, making the timing right for a new launch.
"I think the foodservice industry is something that people want to succeed," Wolf said. "And with the vaccine coming out and the outlook looking a little bit more positive for 2021, we're expecting a resurgence."