B2B alt-protein manufacturer on why $21.5m was the perfect sweet spot for its Series A
Tony Martens, co-founder and CEO for alternative-protein maker Plantible Foods, believes start-ups can get easily distracted from their main focus if they set out to raise more capital than they need to meet their initial targets.
Plantible raised $21.5 million in its series A earlier this month, $5 million more than it had initially intended to secure.
“We could have raised between $35 million and $40 million but it might have distracted us from our main focus because suddenly we have a lot of capital,” Martens told NutritionInvestor.
“You can always put capital to use but in the end, it doesn’t make you smarter with respect to executing your strategy,” he said.
“We identified a couple of key deliverables and we thought about how much those would cost. We took a top-down approach initially and then we shifted to a bottom-up approach. That’s how we landed between $16 million and $20 million.”
Martens also claims that higher capital brings more expectations form investors.
“If you raised a $40 million round then the expectation of what you can achieve is going to be completely different than if you raised $21 and a half million,” he said.
The company is now in the process of securing commercial partnerships with B2C food companies developing their own alt-protein products.
The capital sourced in its Series A will fund a new, larger production facility that will enable the business to scale its offering and fulfil its first commercial contract.
On taking a B2B approach, Martens said Plantible’s initial aim was to build out a novel supply chain and it would consider developing a consumer brand beyond that.
“We’re not excluding the idea of developing our own consumer brand but right now we’re focusing on B2B so that we can really stay focused on the ingredient and then build out the infrastructure,” he said.
Martens expects the company to raise its Series B round in the next 12 to 18 months. It has secured a total funding of $27 million since its launch.
Date published: 15 September 2021