NotCo gets its horn following $235M round to expand plant-based food products

Published July 26, 2021

NotCo, a food technology company making plant-based milk and meat replacements, wrapped up another funding round this year, a $235 million Series D round that gives it a $1.5 billion valuation.

Tiger Global led the round and was joined by new investors, including DFJ Growth Fund, the social impact foundation, ZOMA Lab; athletes Lewis Hamilton and Roger Federer; and musician and DJ Questlove. Follow-on investors included Bezos Expeditions, Enlightened Hospitality Investments, Future Positive, L Catterton, Kaszek Ventures, SOSV and Endeavour Catalyst.

This funding round follows an undisclosed investment in June from Shake Shack founder Danny Meyer through his firm EHI. In total, NotCo, with roots in both Chile and New York, has raised more than $350 million, founder and CEO Matias Muchnick told TechCrunch.

Currently, the company has four product lines: NotMilk, NotBurger and NotMeat, NoticeCream and NotMayo, which are available in the five countries of the U.S., Brazil, Argentina, Chile and Colombia.

The company is operating in the middle of a trend toward eating healthier food, as more consumers also question how their food is made, resulting in demand for alternative proteins. In fact, the market for alternative meat, eggs, dairy and seafood products is predicted to reach $290 billion by 2035, according to research by Boston Consulting Group and Blue Horizon Corp.

NotCo’s proprietary artificial intelligence technology, Giuseppe, matches animal proteins to their ideal replacements among thousands of plant-based ingredients. It is working to crack the code in understanding the molecular components and food characteristics in the combination of two ingredients that could mimic milk, but in a more sustainable and resourceful way — and that also tastes good, which is the biggest barrier to adoption, Muchnick said.

“Our theory is that there is a crazy dynamic among people: 60% who are already eating plant-based are not happy with the taste, and 30% of those who drink cow’s milk are waiting to change if there is a similar taste,” he added. “Our technology is based in AI so that we can create a different food system, as well as products faster and better than others in the space. There are 300,000 plant species, and we still have no idea what 99% of them can do.”

In addition to a flow of investments this year, the company launched its NotMilk brand in the United States seven months ago and is on track to be in 8,000 locations across retailers like Whole Foods Market, Sprouts and Wegmans by the end of 2021.

Muchnick plans to allocate some of the new funding to establish markets in Mexico and Canada and add market share in the U.S. and Chile. He expects to have 50% of its business coming from the U.S. over the next three years. He is also eyeing an expansion into Asia and Europe in the next year.

NotCo also intends to add more products, like chicken and other white meats and seafood, and to invest in technology and R&D. He expects to do that by doubling the company’s current headcount of 100 in the next two years. Muchnick also wants to establish more patents in food science — the company already has five — and to explore a potential intelligence side of the business.

Though NotCo reached unicorn status, Muchnick said the real prize is the brand awareness and subsequent sales boost, as well as opening doors for quick-service restaurant deals. NotBurger went into Burger King restaurants in Chile 11 months ago, and now has 5% of the market there, he added.

Sales overall have grown three times annually over the past four years, something Muchnick said was attractive to Tiger Global. He is equally happy to work with Tiger, especially as the company prepares to go public in the next two or three years. He said Tiger’s expertise will get NotCo there in a more prepared manner.

“NotCo has created world class plant-based food products that are rapidly gaining market share,” said Scott Shleifer, partner at Tiger Global, in a written statement. “We are excited to partner with Matias and his team. We expect continued product innovation and expansion into new geographies and food categories will fuel high and sustainable growth for years to come.”

4 sustainable industries where founders and VCs can see green by going green

Startups Weekly: Uber’s headline-grabbing week and sextech at SXSW

Published March 16, 2019

I spent the week at SXSW, Austin’s really, really huge technology, music, comedy and film festival. It’s my first year making the trek down here for the event, which I did to interview sextech entrepreneur Lora DiCarlo founder Lora Haddock, whose robotics innovation reward was infamously revoked at this year’s CES.

“I brush my teeth and I masturbate. It’s all normal,” she said, addressing the stigma surrounding female-focused pleasure tech. Haddock, during our chat, also announced the first-ever government grant for a sextech startup, a $99,637 funding for Lora DiCarlo from the state of Oregon. Lora DiCarlo plans to release its first product, the Osé, this fall.

Here’s what happened while I was wondering confused around Austin.

Uber, Uber, Uber

Uber dominated the news cycle this week; here’s the TL;DR. The ride-hailing company is probably, most likely going to unveil its S-1 next month and it’s tying up some loose ends ahead of its big IPO. Uber wants to raise roughly $1 billion at a valuation of between $5 billion and $10 billion for its autonomous vehicles unit — yes, the same one that was burning through $20 million per month. Waymo, similarly, is looking to raise outside capital for the first time for its AV efforts.

Top TPG dealmaker caught in college admissions scandal

Bill McGlashan, who built his career as a top investor at the private equity firm TPG, was fired (or maybe quit?) says the firm after he was caught up in what the Justice Department said is the largest college admissions scandal it has ever prosecuted. Even worse, McGlashan lead TPG’s social impact strategy under the Rise Fund brand, making the charges particularly damning.

Accel gets $2.5B

HotelTonight and Slack stakeholder Accel raised $2.525 billion, sources confirm to TechCrunch; $525 million for its fourteenth early-stage fund, $1.5 billion for its fifth growth fund and $500 million for its second Leaders Fund, or a dedicated pool of capital meant to help the firm strengthen its positions on particularly competitive bets. Plus, 137 Ventures announced its fourth fund with $210 million in committed capital. The firm provides liquidity to founders and early employees of “sustainable, fast-growing, private companies.” In essence, 137 Ventures buys shares directly from employees at unicorn tech companies, like Palantir, Flexport and Airbnb.

Sam Altman

Last week, we reported Y Combinator president Sam Altman would be stepping down to focus on OpenAI. TechCrunch’s Connie Loizos questions whether he had a positive or negative influence on the accelerator during his presidency. Altman was part of the first YC startup class in 2005 and began working part-time as a YC partner in 2011. He was ultimately made the head of the organization five years ago.

Brian O’Malley’s HotelTonight win

Forerunner Ventures general partner Brian O’Malley went long on HotelTonight and it paid off. For your weekend reading, we thought you might enjoy an oral history from O’Malley about how he stumbled upon HotelTonight and remained connected to the company across its nine-year history.

Here’s your weekly reminder to send me tips, suggestions and more to kate.clark@techcrunch.com or @KateClarkTweets.

Startup cash

VC shakeups

In an announcement that shocked VC Twitter, Tiger Global announced that Lee Fixel, whom Bill Gurley once said is one of the smartest investors on the scene, is leaving the firm at the end of June. Scott Shleifer and Chase Coleman will continue as co-managers of the portfolios Fixel has overseen, with Shleifer taking over as its head. “Lee has been a driving force behind the expansion of Tiger Global’s private equity investing activities in the United States and India, and he has distinguished himself as a world-class investor across multiple sectors and stages,” the firm stated. And on the hiring front, Canvas Ventures is expanding its team of three general partners to four with the hiring of Mike Ghaffary, a former general partner at Social Capital.

Extra Crunch

Subscribers to TechCrunch’s premium content can learn which types of startups are most often profitable.

Y Combinator’s latest batch

YC demo days are coming up quick. The TechCrunch staff has been meeting with YC startups and documenting their journey through the startup accelerator. I spoke to YourChoice Therapeutics, a startup developing unisex, non-hormonal birth control, and Bottomless, which operates a direct-to-consumer coffee delivery service. TechCrunch’s Lucas Matney wrote about Jetpack Aviation, a YC startup, and its $380,000 flying motorcycle, and Adventurous, an augmented reality scavenger hunt crafted for families. TechCrunch’s Megan Rose Dickey spoke to Ysplit, which wants to make it so you never have to owe anyone money ever again.

Listen to me talk

This week on Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines, Crunchbase News’ editor-in-chief Alex Wilhelm and TechCrunch’s Connie Loizos discuss Uber’s IPO and Stash’s big round. Listen here.

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