Food upcycling has roots in fashion whereby old clothing and fabrics are transformed into new pieces rather than recycled in its current form. Upcycling has a positive impact on the environment as it reduces the need to create a new product. Upcycling itself grew in popularity after the financial crisis of 2008, when economic hardship drove many to find alternative ways to find and have goods. Food upcycling is a newer form of this general trend.
According to the Upcycled Food Associated, “upcycled foods use ingredients that otherwise would not have gone to human consumption, are procured and produced using verifiable supply chains, and have a positive impact on the environment.” Essentially, upcycled foods are made from ingredients used in the production of other foods that would have otherwise been thrown away.
Upcycled foods startups are growing increasingly popular because of the effect food waste has on climate change. An estimated 8%-to-10% of human-caused greenhouse gas emissions came from food loss and waste between 2010 and 2016. Additionally, we lose about $1 trillion per year on food that is wasted or lost. Upcycled foods help capture that lost value. They also have an auditable supply chain in order to ensure that those foods and products are truly helping to reduce the waste from grown food that is never eaten.
Startups that specialize in upcycled foods have pursued both crowdfunding and traditional venture capital to enable their growth and operations. Below is a small set of notable upcycle foods companies that KingsCrowd has seen.
Renewal Mill is a female-founded San Francisco-based upcycled food startup that is producing “okara flour” from the pulp leftovers that are a byproduct of soymilk creation. It also has plans to do the same with oat flour upcycled from the oat milk production process. Renewal Mill’s current line of products include brownie mixes and cookies that are vegan and gluten-free. The startup has a number of established B2B and B2B2C partnerships.
Renewal Mill is an early-stage startup that received a Deal to Watch rating from KingsCrowd. They raised a little over $116,000 from more than 450 investors on Republic.
ReGrained is another Bay Area-based (in Berkeley) startup upcycling spent grain and other food production byproducts into healthy ingredients and snacks. The startup started upcycling the grains used in the beer production process and has since developed their flagship product, Regrained SuperGrain+. SuperGrain+ is a type of flour developed to produce healthier and more sustainable snacks. The startup has also forged partnerships with major food and beverage manufacturers to replace their flour supply with SuperGrain+.
ReGrained is another early-stage startup that received a Deal to Watch rating from KingsCrowd. They had a very successful raise on Wefunder having raised more than $740,000 from 810 investors.
The woman-founded New York-based WTRMLN WTR uses watermelons deemed too unattractive to sell in order to make cold-pressed juice. The company capitalized on the opportunity to upcycle watermelons when it realized watermelon farmers across the country were throwing away massive amounts of watermelons each season.
WTRMLN WTR has raised more than $3.8 million from venture investors and Beyonce and has seen increasing success.
RISE Products is a Brooklyn-based company using the spent grains from breweries to create a barley “super flour” that has more protein, fiber, and less carbs than regular flour. RISE primarily sells brownies, brownie mixes, and its super flour straight to consumers.
The company has raised $150,000 from investors like Food-X, a food-business accelerator, and others.
Barnana is a popular snack found throughout Whole Foods and other grocery stores. The company is based in Southern California and partners with farms in Latin America to buy bananas that would have otherwise been thrown out to produce its wide selection of dehydrated banana snacks.
Barnana is the most far along out of the startups in this list as it has raised $18 million from the likes of Foundry Group, Finn Capital Partners, and others.
Wallstreet has Morningstar, S&P, and Bloomberg
The equity crowdfunding market has KingsCrowd.
About: Francis Vu
An investment professional with a background in private equity and venture capital having spent time conducting investments at VU Venture Partners and Pacific Oak LLC with a finance and management degree from Tulane University.