Food Entrepreneur - June 23, 2020 - 11


poised to be a sustainable long-term solution for climate change and chronic public
health issues that plague our society just
as much as economic difficulties."
Ela Madej, founding partner at Fifty
Years, joined the board of Rebellyous
Foods as part of the investment round.
"We need a pandemic-proof food
system that can meet the nutritional
needs of our growing human family," Ms.
Madej said. "We're also happy to support
job creation in a time when many other
businesses are having to lay off workers."
Cultured meat companies raised $189
million in the first quarter, according to
The Good Food Institute, more than the
amount invested in the category's prior
history, with Memphis Meats' $186 million
Series B funding round. But while the
category shows promise, startups in the
segment may struggle to raise capital in
the near term, said Alex Frederick, senior

analyst, emerging technology at PitchBook, a private market data company.
"Prolonged economic turmoil will
lead investors to focus funding into cash
flow positive opportunities, potentially
starving cellular agriculture startups and
extending development cycles," he said.

Healthy investments
Early-stage businesses focused on
baby nutrition, microbiome and energy
categories saw increased activity in recent
quarters, according to CB Insights. Laird
Superfood, Sisters, Ore., a maker of functional coffee creamers and mushroom
blends, in April closed a $10 million financing round funded entirely by Danone
Manifest Ventures.
"To increase the likelihood of raising
money in this environment, startups
will need to meet a higher bar in terms


Investors see a market opportunity for alternative-protein companies such as Rebellyous
Foods, a maker of plant-based chicken-style nuggets.

June 23, 2020

of product/market fit and business
model durability," Mr. Matthews said.
"The health and wellness category will
continue to look attractive. Even though
big name brands that have struggled
in recent years received boosts in the
early phases of the pandemic, consumer
demand for better-for-you ingredients,
which has been building over the last
decade, will not go away."
In early June, MycoTechnology, Inc.
closed a $39 million Series D financing
round, which brought its total funding to
more than $120 million. The Denver-based
company develops functional ingredients
through mushroom fermentation that
assist food manufacturers with sugar,
sodium and fat reduction. Funds from the
latest round will help the startup prepare
for new product introductions.
"We create products that solve the
biggest challenges in the food industry, like creating great tasting products
without excessive sugar, salt or fat and
doing so in a more sustainable way," said
Alan Hahn, CEO of MycoTechnology. "I
believe this is what attracted our investors
to look closely at our company, and when
they saw the many ways that mushroom
fermentation can truly transform the food
industry for the better, they decided to
invest, even during challenging times."
Sustainability remains of interest to
investors. Apeel Sciences, a Santa Barbara,
Calif.-based developer of a plant-based
solution to extend shelf life of fresh produce, raised $250 million in new financing
in May. Combined with past investments,
Apeel Sciences' valuation is now over $1
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Food Entrepreneur - June 23, 2020

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