A $6 million venture capital infusion is helping Planetarians, a San Francisco-based company that makes whole cuts of plant-based protein, move to the next phase of commercial production.
Aleh Manchuliantsau and Executive Chef Max Barnthouse founded Planetarians in 2013 as a nutritional beverage company. They funded it with just $500 and sold 1 million servings, but they also competed with Soylent, which Andreessen Horowitz backed, Manchuliantsau told TechCrunch.
“The competition was tough,” he explained. “They started undercutting us by trying to put us out of the market with their investment. I started thinking how could I retaliate in a way that couldn’t be mitigated by another injection of cash?”
Looking at the cost of the ingredients the company used in its drinks, the founders found that the most expensive item was the protein. By optimizing the cost of the proteins, Manchuliantsau said the planetarians would have “an unfair technological advantage.”
He recalls paying $5,000 for a ton of soy protein at the time, and when he asked how much this by-product costs, he said he was shocked to learn it was only $300.
This began the planetarians’ foray into by-products or upcycled ingredients. It started with a sunflower oil cake turned into chips. The company sold 100,000 servings, but a texture issue brought the company back to the drawing board, this time with Barilla, the pasta maker. Using Barilla’s flour, it made crackers, which Manchuliantsau said tasted good but gave a dark color unappetizing for noodles.
However, that got the company thinking about where the dark color wouldn’t matter and settled on meat. Planetarians increased its protein content using solid-state fermentation to turn mushrooms into sugar and began making burger-like patties, which it would debut when the 2020 global pandemic hit.
It was at this point that the founders returned to the idea of solid state fermentation and were looking for a way to achieve this without needing the millions of dollars to build out the infrastructure.
“I thought what if we could get the benefits of fermentation but without fermentation?” said Manchuliantsau. “We analyzed biomass and started looking for products already on the market and we found brewer’s yeast, the by-product of beer fermentation. They use yeast to ferment sugars, but they have to discard it after the alcohol is made.”
Planetarians made the first prototypes of his plant-based whole cuts with an umami-like flavor using the oilcake and yeast samples and found the texture and flavor were there. Also, there are only two ingredients — already FDA GRAS (generally recognized as safe) — compared to dozens of ingredients used in other plant-based protein products, Manchuliantsau added.
The world of plant-based alternative proteins has had its ups and downs over the past year. The global market was valued at US$12.2 billion in 2022 and is poised to grow to around US$17 billion over the next five years, driven in part by consumers’ shift to healthier eating and the search for more sustainable alternatives due to animal proteins.
However, taste, among other things, has always been a challenge for plant-based alternatives, and both Bloomberg and the Washington Post have recently written about whether these foods are becoming mainstream. There have also been setbacks at some of the industry’s top companies: Beyond Meat’s share price fell while Impossible Foods experienced layoffs.
However, investors remain optimistic about the future of plant-based alternatives. For example, Fable Food recently announced $8.5 million in Series A funding for its meat-from-mushroom approach, while Rebelyous raised $20 million to rethink the chicken nugget, and the ISH Company and New School Foods is experimenting with plant-based seafood ingredients.
Meanwhile, Planetarians has prices for its “vegan meat,” its flagship product being ribs, on par with chicken. It also touts that its carbon footprint is “50x better than animal meat and 9x better than any other plant-based meat,” meaning that “eating Planetarians Vegan Meat once a week is equivalent to planting 19 trees.” is,” the company said.
The new investment is considered a “Seed II” round and the company is bringing its protein to market after testing the product with hotels, restaurants and schools and securing its first commercial deal.
Mindrock led the investment and was backed by Traction Fund, Techstars, SOSV and AB InBev, where Planetarians sources its yeast. In total, the company raised about $6.7 million.
The company has already verified its technology on an industrial scale and made the first steps on a product market fit. It intends to use the capital to build a pilot plant and continue to increase sales. Manchuliantsau said the facility can be as small as 3,000 square feet because it receives the fermented product without having to do the process itself.
“It would cost $3million to bring the whole line to market, which will produce up to £15million a year,” he added.
Next, the company is preparing its second line and collecting orders to start production in October. It also works with AB InBev to place its lines in all breweries around the world.