Picture Credit: Cultivated foie gras from Gourmey
Premium Fine Foods – A Booming Segment within Alternative Proteins
By: Shruti Azad
A new trend that we are seeing in the alternative protein industry is companies exploring whole cut deli meats and fine foods. One of the main reasons startups are moving to these niche categories is because there is a gap in the market when it comes to quality whole cut deli meats and other fine foods having the right taste, texture and mouthfeel.
“There were plenty of burgers & sausages on the market, but no tasty plant based deli slices. A vegan burger option started to become a staple in fast food chains, but not a single wine bar had a plant based charcuterie board to offer,” said Peter Kalkowsky, co-founder at London-based vegan gourmet deli meat company, Shocken Foods. “We were dreaming of vegan smoky chorizo or beef bresaola that would taste amazing, so we could eat it ourselves.”
Here are 3 key areas that startups looking to enter this category need to keep in mind.
Consumer Expectation
When it comes to gourmet whole cut meats and fine foods, the category tends to be more demanding and companies need to get taste and texture spot on. This is because these meats (steak, bacon, charcuterie meats) are generally enjoyed on their own rather than built inside a sandwich, for example.
For that reason, it is very important to understand your consumer’s expectations and spend time in building a product with a great flavour profile and the right texture. Conducting regular tasting sessions with consumers and re-evaluating your product before launch is essential.
“You need to spend the required time to come satisfyingly close to traditional meats before rushing to market. If you cannot interest meat eaters in purchasing your product more than once you probably do not have a product with a future. The market will grow only as flexitarian meat eaters decide to forgo meat for an alternative,” said David Jones, co-founder at Thrilling Foods, an American company producing plant-based bacon made from soy milk that is traditionally salt cured and hardwood smoked.
Cultural Influences
It is always important to factor in the influence of geography, culture, and traditions in consumer’s eating habits and preferences, but this is particularly true with whole cut and premium meats.
For example, Gourmey produces cultivated foie gras, a dish that is closely linked with French cuisine, culture and heritage and one that flexitarians might pay a premium to try.
US-based company Novel Farms works to produce whole cut pork analogues – both tenderloin as well as Iberico ham cuts. Iberico meat is distinctly different from regular pig meat, thanks to the particular genetic profile of Iberian pigs. Because Iberian pigs are primarily raised in Spain and Portugal, their production is limited and mainly destined for the crafting of dry-cured gourmet ham – Jamon Iberico. For these reasons, Iberico fresh pork meat is highly valuable and prices are 2-3x higher than for regular pork.
“As a born and raised Spaniard living in the USA, I always thought that the rest of the world is missing out on enjoying the quality and benefits (i.e. healthy fats) of this particular type of meat due to its scarcity in other parts of the world. That is when I realized that, using cellular agriculture and our tissue engineering technology, we could democratize the access to premium meats and make them available to the entire world,” said Nieves Martinez Marshall, co-founder at Novel Farms.
Another food that is affected by culture is caviar, which is often consumed as a luxury staple around the world. Optimized Foods, from the US, has created an alternative caviar using cell culture and mycelium. And while the market is lucrative, understanding the target audience will be even more important for products such as caviar.
Another interesting company developing cultivated fine foods include US-based company, Pearlita Foods developing cultivated oysters.
Price Parity vs Scale-up
The products within this fine foods sector have always been seen as more premium than the supermarket shelves. People expect to pay more for these foods which are generally hand-made, more labour intensive and use expensive ingredients.
Hence, in the case with cultivated meats where development costs will be higher prior to upscaling, it makes sense to develop a premium product that people would pay more money for. For example, development and research behind creating foie gras and chicken liver is not very different, but due to the nature of the end product, the price points at which you can sell them are significantly different.
This is an important factor to keep in mind when selecting your product and evaluating both scale-up production cost and market prices.
With many white spaces in the market, the fine foods category provides tremendous potential for entrepreneurs looking to develop innovative products that deliver. Startups that have a deep understanding of consumer preferences and local culture along with getting the flavour, texture and umami profile right can really stand out within this category.
The Big Idea Ventures team is always on the lookout for innovative alternative protein companies. If you are an early-stage startup looking for investment and support, reach out to us here. If you are a corporate or an investor interested in investing in the space, reach out to us here.