Vegan expansion: General Mills leads US$40m investment in Kite Hill
23 Oct 2018 --- The US plant-based food market is receiving further support to meet the consumer demand for vegan products. Vegan cheese and yogurt company Kite Hill has secured US$40 million in funding led by 301 Inc, the new business development and venturing unit at General Mills. Cavu Venture Partners also participated in the financing round and the deal is expected to close within a month.
The demand for vegan products shows no sign of slowing down. Gravitation towards plant-based diets in general, along with interest in vegan, vegetarian and flexitarian lifestyles as well as concerns over animal welfare, have together led to increased interest. NPD has consequently seen an 11 percent CAGR for the 2013-2017 period, according to Innova Market Insights data. Research also indicates that four in ten US consumers increased their consumption of meat substitutes/alternatives during 2017. The global market for alternative dairy drinks is expected to reach US$16.3 billion this year alone, which is up dramatically from US$7.4 billion in 2010.
Within this plethora of plant-based claims, the stand-out area is the plant-based milk space, with Innova Market Insights' consumer research indicating that US consumers have increased their consumption of plant-based milk (as well as yogurt) in the two years to the end of 2017.
Kite Hill, which makes plant-based yogurts, cream cheese-style spreads, soft cheeses and probiotic drinks sells its products at retailers including Whole Foods Market, Sprouts, Kroger and Target. The company has recently grown due to both the quality of the products and rising consumer adoption of healthy plant-based diets. The capital from this funding round will enable the company to increase its capacity, invest in marketing, innovation and people to help fuel its rapid rate of growth.
“This investment propels Kite Hill into a great position to continue our rapid pace of expansion,” says Rob Leibowitz, Kite Hill CEO. “We are eager to meet the seemingly insatiable consumer demand for our delicious chef-inspired plant-based, vegan foods. As such, we’ll be investing substantially in factory capacity expansion. We will also continue to innovate in product development and marketing to drive further awareness and adoption of our delicious foods which never compromise and always deliver extremely well on both taste and texture.”
Co-founder and Chef Tal Ronnen adds: “We started Kite Hill because we knew we could make excellent dairy alternatives that everyone would love. What we’ve created to date has exceeded our expectations. Now that we are available nationwide, we want to continue to offer people the high quality, innovative products they have come to expect from us at Kite Hill. We are showing consumers just how delicious plant-based foods can be.”
“Kite Hill continues to set itself apart in what is now a mainstream demand for plant-based nutrition,” explains John Haugen, founder and managing director of 301 Inc. “As more people are making changes in their diet, we see incredible untapped potential in the market for the brand to expand its consumer base and grow.”
Plant-based product claims have increased by 62 percent globally from 2013 to 2017, according to Innova Market Insights data. “The dairy alternatives market has been a particular beneficiary of this trend, with the growing availability and promotion of plant-based options to traditional dairy lines, specifically milk beverages, and cultured products such as yogurt, frozen desserts and ice cream,” that is according to Lu Ann Williams, Director of Innovation at Innova Market Insights.
In July, a Cargill consumer insights study entitled, “The Shifting Global Dairy Market,” looked at global changes in attitudes towards dairy. Cargill surveyed 5,200 grocery shoppers from 13 different countries to better understand what’s important to consumers in choosing dairy and dairy alternatives, their preferences relating to the texture and clean label of products.
According to results from the study, overall dairy usage is generally in decline. In the US, there has been a 22 percent decline in fluid milk consumption and a triple-digit increase in non-dairy alternatives (2000-16). The study also found that a good taste is the most important factor in purchasing decisions and 50 percent of participants consume both dairy and alternatives and only 12 percent avoid dairy altogether.
To contact our editorial team please email us at firstname.lastname@example.org
Subscribe now to receive the latest news directly into your inbox.