Next Gen, a Singapore-based food technology startup that produces plant-based meat products, has raised a $10-million seed round from a clutch of investors including Singapore’s Temasek Holdings, K3 Ventures, EDB New Ventures, German retailer Metro AG-backed NX Food, Vietnam’s FEBE Ventures, Switzerland’s Blue Horizon.
The seed round exceeded the company’s target of $7 million as the trend to invest in the food-tech sector is supported by customers and investors globally, Next Gen co-founder and COO Andre Menezes told DealStreetAsia.
The company last year raised initial capital of $2.2 million from its founder and CEO Timo Recker.
Next Gen is planning to deploy the proceeds to launch its plant-based chicken meat brand TiNDLE in Singapore on March 18, 2021. The company plans to subsequently take the brand to other cities in Asia such as Hong Kong and Tokyo.
“We understand that our consumers are in those global urban centres that are located in the countries around the world,” Menezes said.
In the longer term, Next Gen is also eyeing to expand further into some of the world’s main markets for meat, namely the US, Europe, China and Brazil. The company will look at raising a Series A round, which will be significantly higher than the seed financing, to support its expansion into these main markets, hopefully in one to two years, he added.
Next Gen differentiates itself from other plant-based meat players by producing plant-based chicken meat, which can be cooked into different cuisines and recipes. Meanwhile, other existing players in the global market are mainly focused on plant-based red meat such as beef, pork or sausages.
In order to develop its market penetration as well as its research and development, Next Gen also collaborates with chefs and some restaurants, Menezes said.
Officially launched in October 2020, Next Gen started the business in the middle of the Covid-19 pandemic. Thus, the company operates with an asset-light model where it runs the entire business in fully digital mode.
The company does not have a manufacturing facility in Singapore. Instead, it partners with a Europe-based manufacturer that can apply its recipes, ingredients and technology to produce plant-based meat. Together with its partner, Next Gen has the capacity of generating 5,000 metric tonne meat annually to serve up to 9,000 restaurants around the world.
“As we progress, we will definitely need more capacity to grow. We will then engage potential manufacturers and develop partnerships in different locations based on where the consumption is,” Mendezes said.
The global plant-based protein segment is expected to reach $85 billion by 2030, according to UBS. Meanwhile, the global investment in food technology for the first three quarters of 2020 was $8.37 billion, up from $7 billion in 2019.
Despite having seen strong demand in western countries, plant-based meat is only now gaining momentum in Asia.
According to DuPont N&B, demand for plant-based products in Asia will surge over 200% in the next 5 years. While Technavio research estimates the market will be worth $12.75 billion by 2030.
Next Gen claims to have no competitors so far as it is the first company that develops plant-based chicken meat. Other global players in plant-based meat are the US-based Impossible Food and Germany-based LikeMeat, which was also founded by Timo Recker.