August 5, 2016

Powerplant Ventures, a new private equity firm dedicated to backing emerging plant-based food and beverage companies, announced it has closed a $42 million fund.

The firm was founded in 2015 in Los Angeles by a partnership of investors in the plant-based food, CPG, and restaurant sectors. Founders include Mark Rampolla, the founder of ZICO Coconut Water, which he sold to Coca-Cola in 2013 for $200 million, Kevin Boylan and T.K. Pillan, the co-founders of the vegetarian restaurant chain, Veggie Grill, and Dan Beldy, the former managing director of Steamboat Ventures, the capital venture arm of Disney.

Beldy told Tech Crunch that the firm plans to commit up to $250,000 to seed rounds, and up to between $1 million and $2 million in Series A and Series B rounds in companies with a minimum of $1 million in revenue, a strong team, and products that display a potential for growth. With its investment, the firm plans to ‘play an integral role’ in its portfolio company’s growth strategies including branding, team building, and operations.

Powerplant Venture’s current portfolio of companies includes Hail Merry – a  vegan, gluten-free, dairy-free, non-GMO snack company, REBBL – a plant-based protein drink company, Thrive Market – an online gluten-free, non-gmo, non-toxic, vegan marketplace, Terravia – a biotech company, Hampton Creek – a plant-based food company, Treasure8 – a food innovation and technology company, and Juicero – an organic, cold pressed juice company.

The plant-based food sector is one of the fastest growing and dynamic investment spaces within the investment universe. Launches of vegetarian startups increased by 60% between 2011 and 2015, according to Innova Market Insights reports Inc.  Even more telling of how the category is growing is that more than one-third of consumers now consider themselves to be “open to plant-based products,” according to the Global Food and Drink Trends Report 2016 issued by Mintel, and sales of meat alternative products are expected to reach $5 billion by 2020, reports Latest Vegan News.

“…the growing ranks of novel protein sources and potential replacements appeal to the everyday consumer,” states the report, “foreshadowing a profoundly changed marketplace in which what was formerly ‘alternative’ could take over the mainstream.”

Nowhere has this been more evident than the recent announcement that Danone has agreed to acquire WhiteWave in a deal that would value the company at $10 billion. Other recent activity in the space includes the May announcement that plant-based and dairy alternative company, Kite Hill raised $18 million in a Series B led by 301 Inc. and CAVU Venture Partners; vegan giant, Hampton Creek is reportedly raising $200 million as it aims to quadruple sales to over $100 million this year, and New Wave Foods, a company making plant-based seafood alternatives, announced it has opened a seed round anchored by investments made by early stage investor, Efficient Capital, and venture capital firm, New Crop Capital.

“Companies are clearly poised to capitalize on the massive shift that is underway to change how we grow, process, distribute and consume food,” Kevin Boylan, partner, Powerplant Ventures told Inc.

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Lynda Kiernan