The reasoning behind consumers’ choices has changed drastically in the past decade. While price and convenience will always play a role in purchasing decisions, the desire to buy “better” products that have social benefits is certainly at the root of our shifting economy. With the rise of conscious consumerism, the democratization of information thanks to the Internet, and the growth of millennial buyers (who now represent $1 trillion in buying power), the personal health, animal welfare, and environmental impacts of products are coming under increased scrutiny. This has become incredibly evident in the food space as more and more people are choosing to skip out on meat and dairy regularly, leading to a massive growth in the plant-based food sector.
Toting health benefits, a lower environmental impact, and none of the animal welfare concerns that come with meat and dairy, plant-based foods have become the natural “better” choice for many consumers. An estimated 43 million Americans (86 percent of whom are not vegan) are reaching for plant-based proteins, around 79 percent of Gen-Zers regularly go meat-free, and one in ten millennials identify as vegan or vegetarian, plant-based food sales topped $3.3 billion last year, and around 50 percent of chefs in the U.S. have added vegan items to their menus to keep up with demand (not to mention those who switched to an entirely plant-based menu saw a revenue increase of up to 1000 percent).
The idea of making change with your dollar is certainly not lost on modern consumers, but the food space is hardly where these conscious decisions are ending. In a recent episode of the #EatForThePlanet with Nil Zacharias podcast, Jody Rasch, Managing Trustee of VegInvest, shared a number of insights into the growing “humane economy” that is centered around removing animals from various parts of the supply chain.
Jody has been plant-based for the better part of 30 years and has watched innovation in the food sector and beyond skyrocket in recent years. As an investor, he is in-tune with the latest trends in the space and has a keen eye on the pain-points where better products are sorely needed. He describes the current stages of the vegan food/lifestyle space as being around Vegan 101 and identified three major areas of opportunity:
1. Vegan Yogurt and Hard Cheeses
The dairy alternative milk market is undoubtedly one of the largest segments in the plant-based food space, and the number of companies making vegan milks has risen exponentially. This part of the sector has become increasingly saturated, but Jody points to a gap in quality plant-based yogurts and hard cheeses. There are a number of budding plant-based yogurt companies, but none have managed to truly capture the market. Jody uses the example of WholeSoy as the target, which has yet to be recreated in any of the new products. In terms of vegan cheese, he is interested in brands working on Swiss or cheddar cheese but highlights the need to make these sorts of products without loading them with coconut oils or other ingredients that make them less desirable from a health standpoint.
2. Non-Animal Materials and Alternatives to Animal Testing
As Jody points out, a plant-based lifestyle is about so much more than just food. The focus of VegInvest is to provide early-stage funding to companies working on solutions that can take animals out of the equation. One example of this is vegan materials, such as the pineapple leather recently developed for Hugo Boss sneakers. Jody also identifies companies working to grow cultured leather in labs as ones to watch for investment.
Another major area he hits on is the opportunity for alternatives to animal tests. As he points out, there is a massive margin for failure in the world of animal testing since human biology rarely mimics the results found in animal tests. VegInvest has made investments into a company that is developing human organs “on a chip,” that essentially uses human cells to grow organs in a lab, rendering animal testing obsolete.
3. Healthy Vegan Food That People Actually Want
It is wonderful to see the success of plant-based meat and dairy replacements, but there is a real need to develop products that can mirror the taste and texture of “the real thing” without being overly processed or loaded with salt, sugar, and oil. This is one major area Jody identifies as prime for innovation.
As he states, “The problem we have is what people want is generally not all that healthy for them. What we’ve got to figure out is how we get people to want what is healthy.” It is certainly wonderful to be able to find burgers and cheeses that taste exactly like a traditional, greasy product, but as of yet, the only way this has been accomplished is by adding tons of oils – Jody highlights the downsides of overconsuming coconut oil. What he would like to see more of is companies working to take natural produce and make it delicious without having to sacrifice on health. As he says, “we can get past vegan product 101 and get to the next stage, where what people will crave and what we’ll be able to produce actually fulfills the vision of it being good for the animals, good for the planet, and being good for people.”
These are just three of the insights Jody provided during this in-depth interview, so if you are interested in learning more to help advance your business, be sure to listen in for more!
You can listen to the full episode below or on the following platforms: iTunes, Spotify, and Stitcher.
If you like this episode, be sure to subscribe to the #EatForThePlanet with Nil Zacharias podcast for new episodes with food industry leaders, health, and sustainability experts, as well as entrepreneurs and creative minds who are redefining the future of food – and order your copy of the #EatForThePlanet book!
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