As meats vanish from shopping aisles, Americans are turning to ‘fakes.’

Welcome to foodtech, another sector whose fortunes have turned amidst the unprecedented COVID-19 crisis. Within foodtech, plant-based proteins are stepping in as meat substitutes to meet the shortfall in meat supply due to the closure of large meat processing plants across the U.S. (The National)

Nervous human beings are also looking askance at the safety of eating meat as the implications of the origin and spread of the virus are slowly sinking in. Meat substitutes, which are constituted from plant-based proteins, look increasingly attractive – on the counts of immediate availability, safety, cost, and taste.

In recognition of the trend, investors bid up the Beyond Meat (NASDAQ: BYND) stock by 49% last month. Sales of meat substitutes in mid-April doubled from the corresponding period last year.

Impossible Foods burgers, Beyond Meat sausages, and Tofurky deli slices were the top-sellers.

Meat substitutes: A pivotal moment in China

A supply chain disruption in the massive meat market in China has the country’s authorities worried. Though the country’s food habits already include a soy-based protein and meat alternative such as tofu, as well as plant-based dairy, fake meats are yet to catch on.

But after COVID, that may be about to change dramatically. “We believe this recent uncertainty might just be a pivotal moment for the still-nascent food-tech sector in China,” Matilda Ho, founder and managing director of Bits x Bites, a food technology venture capital company in Shanghai, said to Bloomberg.

The prospects for the fake meats sector are therefore attractive, and deal-making is on the rise.

Pepsico (NASDAQ: PEP) in February paid $705 million to acquire Baicaowei, a Chinese company manufacturing fake “sausages” that are plant-based and made from soy and konjac.

VC and PE interested

Venture capitalists are eager to fund startups in the fake meat space, whether lab-synthesized or plant-based.

Some of the startups that have received funding recently are:

• Barcelona-based Novameat
• San Diego-based Plantible Foods
• China-based Starfield
• Berkeley-based Climax Foods
• Seattle-based Revellyous Foods

According to Chris Kerr of New Crop Capital, plant-based foods are a mega-trend that is here to stay.

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