Nearly 20% of Americans eat gluten-free products such as baked goods made without grains, according to a 2015 Gallup poll. Also, about 25% have lactose intolerance meaning they are likely buyers of dairy substitutes. Moreover, up to 7% of Americans consider themselves vegetarian, according to Gallup, and market research predicts the US market for meat substitutes will grow to over $1B by 2020, up from $850M in 2014.
The growth in the market for gluten, meat, or dairy alternatives is driven by real or perceived health, environmental, and lifestyle benefits. But another trend is innovation in technology that’s allowing food manufacturers to meet these needs with foods that substitute for animal or gluten products while still offering pleasing flavor and texture.
We used CB Insights data to identify numerous startups offering alternatives for food replacement. The companies in this graphic have raised over $500M in aggregate, led by lab-cultured meat startup Impossible Foods, which has raised $183M from Khosla Ventures, Bill Gates, Horizons Ventures, Google Ventures, and others.
Our graphic also includes multiple graduates of the Indie.Bio accelerator, including Muufri, designing animal-free milk; Miraculex, working on plant-based sugar substitutes; Gelzen, creating animal-free gelatin; and Willow Cup, engineering plant-based dairy-free lattes. View the full graphic and details on each category below.
Please click to enlarge. Graphic includes private companies only.
Breaking down the food replacement market map:
- Dairy-free milk and cheese - Companies producing a variety of vegan dairy products. Ripple — recently launched in Target nationwide — raised $44M and offers a pea-based dairy-free milk. Kite Hill ($25M in funding) uses nut milk to make dairy-free cheeses, yogurts, and desserts, while Melt Organic ($2M) offers vegan butter and Wayfare provides dairy-free butter, cream cheeses, and sour cream.
- Egg substitutes - Hampton Creek leads the category with $120M in funding to make its vegan, gluten-free egg substitute. Clara Foods ($2M) hopes to develop a lab-cultured egg white.
- Meat substitutes - Companies offering animal-free meat products in various ways. Impossible Foods, which leads our chart with $183M in funding, makes a plant-based burger it claims tastes, looks, and feels like meat, and which made its first market entry in Manhattan restaurant Momofuku in July 2016. Beyond Meat ($17M) has a similar plant-based product, while Memphis Meats aims to create real meat without animals through lab culturing. New Wave Foods is working on plant-based shrimp.
- Insect protein - Companies using insects – mainly cricket flour – for snacks and protein bars. Exo raised over $5M for its cricket-based protein bars, while Entomo Farms with $1M focuses on protein powder.
- Animal-free gelatin - Gelzen raised $200K in seed funding aiming to engineer an animal-free gelatin, which would enable a wide range of products to become vegetarian.
- Flavoring substitutes - NuTek, with $14M in funding from Khosla Ventures, sells potassium-based salt with 75% less sodium than table salt. Miraculex ($200K seed funding) aims to create a healthy sugar substitute.
- Meal substitutes - Led by Soylent ($21.5M in funding, including from Andreessen Horowitz, Index Ventures, and Lerer Hippeau Ventures) these companies provide drinks they claim can fully replace the need for other food, if desired.
- Gluten-free baked goods - Companies providing foods like waffles (Surprisingly Vegan, with $40K), frozen dumplings and Asian meals (Feel Good Foods, with $350K), and tarts (Hail Merry, with $6M) that are gluten-free.
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