The Rise of Vegan Direct-to-Consumer Businesses
We’ve always had a feeling the plant-based movement would be a big one... but no one could have predicted the massive amounts of investment, financing, and success that can come from vegan direct-to-consumer products.
This year, we're seeing some of the largest funding rounds ever for vegan retailers and creators of vegan consumer brands. Recently, The Vegan Kind secured a £3.5m investment and The Cookaway is walking away from a crowdfunding campaign with £800k to build their business.
Plant-based food options are growing almost exponentially globally, although interestingly, not all patrons are vegetarians or vegans. The rise in the flexitarian movement (think, “Meatless Mondays”) or simply those looking to cut down on their meat-heavy diets are also contributing to this growth as education surrounding meat consumption becomes more widespread.
While vegans and vegetarians account for roughly 4% and 6% of the global population, flexitarians or “meatless curious” folks are contributing to the plant-based hype we are seeing today. (Euromonitor)
Let’s take a look at some of the recent direct-to-consumer success stories for Vegan brands.
The Vegan Kind
The Vegan Kind is an online vegan supermarket and subscription box operating in the UK. They entered their most recent fundraising round looking for a £500k investment in for a 12% stake (£4.1m valuation). Confident in their operations, The Vegan Kind has been growing steadily and 2020 was no exception, with revenues jumping 56% to £2.5m by year-end.
Their crowdfunding campaign went public on Seedrs and has raised £3.5m for their new warehouse, managing and distributing over 6000 plant-based products to subscription box members and through their online supermarket.
For a team that was bootstrapped from 2013 up until March 2020, this kind of investment will do wonders for the company’s success.
This business launched in 2020 as a cuisine recipe startup and cook-along program. They’ve raised £800,000 in crowdfunding and are looking to expand their platform. Their service is subscription-free and offers a variety of world cuisines to explore, providing a fun option for at-home meals during a year where dining out wasn’t really an option for many people.
The company plans to bring more chefs and more cuisines on board after this recent fundraising round closes, to offer a greater variety of foods and improve their distribution.
While not entirely vegan or plant-based, Cookaway provides an excellent example of the importance of enjoying home cooking. They have made a positive impact for many individuals and families over the course of the 2020 lockdown through their engaging videos and programs.
Cookaway also provides a corporate service with Ikea, Deloitte, Dyson, Mars, and Santander to name a few of the businesses they have worked with.
What do these companies have in common?
If we have learned anything from The Vegan Kind and The Cookwaway, we now know that crowdfunding is key! Success on a crowdfunding campaign proves that there is consumer demand for the products or services you are providing; the consumers want what you have to offer.
This is fantastic news for the vegan and plant-based direct-to-consumer segments, and if anyone was looking for validation this is it.
We saw it with The Vegan Kind, they were bootstrapped for 7 years, and as soon as the time was right and their crowdfunding took off, their revenues grew 56% in a single year. Financing is so important for the growth of companies, and crowdfunding your vegan product is a great way to accomplish this.
Here are a few more examples of thriving vegan or plant-based food companies:
White Rabbit Pizza Co.
Having won many awards for their food in the past few years, White Rabbit Pizza Co. offers gluten-free, vegetarian, and vegan pizzas that are outrageously tasty.
They consider themselves a “pizza for the people” since everyone can enjoy their delicious products.
While White Rabbit Pizza Co. started out of the White Rabbit pub in Oxfordshire, they are now commercially available in many stockists around the UK including Waitrose, Sainsbury's, and Booths.
Another consumer product, Love Oggs are a vegan baking alternative. This egg alternative is made of aquafaba (the water from canned chickpeas) and aims to remove the “hidden” animal products in many common foods.
Love Oggs uses their original egg alternative product and also produces vegan-friendly baked goods like cupcakes, cookies, and brownies.
Their website also shares many delicious recipes that are free of animal products. Vegans, rejoice!
Plant-based is on the rise. Not just for vegans and vegetarians, but flexitarians and plant-curious consumers, too.
The market is adapting and plant-based direct-to-consumer product crowdfunding campaigns are speaking volumes about the wants and needs of current consumers.
If you have a vegan direct-to-consumer product you are looking to fund, or have plant-based product ideas and aspirations, crowdfunding is a great way to get your proof-of-concept and to also raise money without investors taking a portion of your company.
If you are on the consumer side and are looking for new vegan or plant-based products to get your hands on, checking crowdfunding sites regularly is a great way to find new products or become involved with some of these fantastic communities.
One great example of the success these types of companies can enjoy from crowdfunding is The Vegan Kind. As a bootstrapped company from 2013 to early 2020, they were seeing some success, but when they had the funds to expand their operations and move into a larger facility thanks to their £3.5m investment, their revenues grew a whopping 56% in a single fiscal year.
You may not “need” to take on an investment, but it can certainly help your plant-based business be the absolute best version of itself.