POW! Foods is on a mission to create nutritious and tasty products that help consumers ‘replace meat in any meal’.
Its technology is founded on a molecular modelling platform, which the Chilean start-up developed after ‘extensive R&D’, CEO and co-founder Amy León explained at ProVeg Incubator’s Startup Demo Day last month.
“The platform is based on proprietary data that we collected by studying the interaction between plant-based proteins and biomolecules.”
What is particularly unique about this platform, however, is that it allows León and her team to ‘develop many different textures and flavours’ by ‘adjusting the environment within which the ingredients react’.
The products – of which so far there are two: chorizo and sausages – are created from a combination of pea protein, corn protein, and rice protein, and produced in a conventional manufacturing facility.
“The interesting thing about our processing manufacturing line is that we can use the same production line as a [meat plant] with no additional CapEx cost,” León told delegates.
Launching in a meat-loving geography
POW! Foods’ CEO is vegan herself. After four years of a meat-free lifestyle in her home country of Chile – which has one of the highest meat consumptions per capita – León observed that “meat is so tasty, that people cannot live without it – even if they know it may cause harm to animals, their health and the planet”.
The region’s meat market is growing. According to Statista, in 2018 the processed meat market in Latin America reached $82.2bn. It is expected to hit $164.3bn by 2023.
According to the same market analysts, Chileans eat on average 74kg of meat per year, which ranks the South American nation in seventh place amongst OECD countries behind the US, Australia, Argentina, Israel, Brazil and New Zealand.
However, 42% of Chileans want to eat less meat, León told delegates: “And this represents $500m of potential market [value].”
In POW! Foods’ first year on the market, the start-up sold more than 80,000 units, which brought in revenue of $40,000, with a healthy sales margin of more than 40%.
“In the [coming] years, we will lead the Latin American plant-based market. We are starting in Chile and then we [will] introduce POW! Foods to Colombia, and last but not least, to Brazil.”
Healthy and sustainable?
POW! Foods claims its products, and its production methods, are more sustainable than many others in the market. “We require less energy than other technologies [and] this platform allows us to design the product to be highly nutritious,” León explained. “And last but not least, we don’t need to include any additives in our products.”
Compared to its animal-based counterparts, POW! Foods’ alternatives use 80% less water, contain up to three times more protein, yet with 70% less fat and no cholesterol.
Concerning the products’ nutrient profile, its traditional chorizo, roast flavour sausage, and smooth flavour sausage products do carry ‘high in sodium’ labels. According to national food law, this means the established limits for sodium (400mg/100g solid product) has been exceeded. POW! Foods’ chorizo alternative product, for example, contains 718mg sodium per 100g, or 359mg per portion.
León admitted the products’ salt content was a concern initially. However, having discussed the nutritional properties with customers, POW! Foods observed that consumers were primarily interested in taste and texture.
“I think that sodium…in this type of product [chorizo and sausages] is usually high…[so] in these particular products people are not worried about the content of sodium. It is something we validated with customers when we started the samples.”
León continued: “[Reducing salt content is] something that we can develop in the future, but [it will be] dependent on the demand.”
The start-up’s business model is based on selling into retail channels. It has been selling its chorizo and sausage products into more than 33 independent stores across the country, and just last month, closed a deal with a national wholesaler to expand its national reach.
POW! Foods also recently came to the end of a three-month stint at the ProVeg Incubator, headquartered in Berlin, Germany.
Moving forward, by 2022 POW! Foods plans to have a positive EBIDTA, and by 2023, expects to have sales of more than $3m. Listings with two of the region’s biggest retailers, Wal-Mart and Jumbo, and launching the brand into foodservice, will help the start-up get there, León revealed.
As too will expansion of the biotech’s product range. POW! Foods is currently raising $50,000 to achieve its next goal, which includes bringing a burger, chicken, and ham alternatives to market. The investment will also help the start-up expand its production capacity twenty-fold, further develop its molecular modelling platform, and kickstart its IP protection process.