Plant Based Dairy and Egg

A booming food and beverage segment with a history as rich and varied as its present-day product offerings.

Overview

Plant-based dairy and eggs to lead an animal-free food future

Consumers across the US and beyond are already well acquainted with plant-based dairy products. From the first commercial soy milk facility in 1917 in New York to Sweden’s Oatly oat milk taking coffee shop culture by storm, consumers worldwide have demonstrated an almost singular openness to experimenting with plant-based substitutes. Now experimentation is beginning to expand beyond the grocery store milk aisle to all aspects of dairy and egg products.

Plant-based dairy and egg products currently under development incorporate a broad range of ingredients, including peas, mung beans, soybeans, chickpeas, almonds, coconut, sunflowers, and sesame, among others. These alternatives are vying to replace traditional cheese, yogurt, ice cream, butter, spreads, and creamers, while a wave of new startups are attempting to produce a substitute for chicken eggs.

This revolution is being driven by an increasing focus on health, animal welfare, and climate change. The recent emergence of zoonotic diseases, such as the Covid-19 pandemic and the African swine fever, have also drawn attention to the growing animal-free food production industry, with plant-based foods taking center stage.

What's driving this industry?

Industry Updates

Brave Robot becomes the top category growth driver
Sep 23
Ripple Foods secures USD 60 million in Series E funding
Sep 21
Formo secures USD 50 million in Series A funding
Sep 13
View all updates
Market Sizing

US plant-based dairy and egg market to reach USD 5.5-9.1 billion by 2025

Conservative case

USD 5.5 Bn

Base case

USD 7.3 Bn

Expansion case

USD 9.1 Bn

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COVID-19 IMPACT

  • Sales of plant-based dairy spiked 75.3% YoY as US lockdowns began in mid-March 2020, softening to a still-strong 17.2% by mid-November 2020.

  • Sales of plant-based cheese also saw a 95% YoY spike in mid-March 2020 which remained elevated around 54% YoY over mid-April 2020.

  • In August 2020, Eat JUST reported plant-based egg sales equivalent to 50 million chicken eggs since launching in April 2019. 

Market Mapping

Most plant-based dairy startups focus on milk and cheese substitutes while plant-based butter has attracted less activity in part due to consumer aversion to plant-based fats over health concerns. Disruptors attempting to develop plant-based dairy alternatives from new ingredients—beyond a standard set of soy, almond, cashew, coconut and oats—have attracted significantly more funding compared to the rest of the industry.

More than half of the plant-based dairy startups we analyzed have brought a product to market with a few companies reaching the growth stage of business development. The plant-based egg industry, on the other hand, is far less developed with fewer new startups and only a handful successfully bringing a product to market.

Incumbents
Growth
Early
Seed
Pre seed
Ingredient Supplier
?
Milk
?
Cheese
?
Butter
?
Ice Cream
?
Yogurt
?
Egg
?
Collaborative
Collaborative
Collaborative
Collaborative
Collaborative
Collaborative
Collaborative
Perfect Day
Above Food
Remilk
Nestlé
Starbucks
Danone
SunOpta
Koita
Plenish
NotCo
Califia Farms
Ripple Foods
Oatly
Malk Organics
VLY Foods
Sproud
EVR Foods
Heartbest Foods
Mighty Pea
NuMilk
Rebel Kitchen
Qwrkee
The Bridge Bio
Next Meats
Turtle Tree Labs
Goodmylk
BioMilk
Uproot
Mohjo
DRYK
Impossible Foods
Danone
Upfield Group
Kite Hill
Heidi Ho Organics
Miyoko’s Creamery
Good PLANet Foods
Nabati Foods
Heartbest Foods
Nuts for Cheese
Willicroft
Formo
Stockeld Dreamery
Mooliss Vegan Cheese
Better Dairy
Grounded Foods Co
Parmela Creamery
Pleese Foods
Tomm Pousse
PlantLX
Upfield Group
Califia Farms
Kite Hill
Miyoko’s Creamery
Goodmylk
Unilever
Danone
Little Bean
Oatly
Nadamoo!
Eclipse Foods
Better Dairy
Sunscoop
Ice Queen
The Urgent Company
Danone
Springfield Creamery
Califia Farms
Ripple Foods
Oatly
Kite Hill
The Collaborative
Yofix Probiotics
EVR Foods
Halsa
Better Dairy
Danone
Grupo Mantiqueira
Eat JUST
Zero Egg
Nabati Foods
Yumgo
The Vegg
Next Meats
Float Foods
Evo Foods
Le Papondu
Crackd

The Disruptors

The three most-highly funded startups in the plant-based dairy industry have already accumulated more than USD 800 million in total funding, with Perfect Day claiming USD 361.5 million of that figure for itself, followed by Califia Farms at USD 340 million, and Ripple Foods with USD 186.3 million. All three startups have brought their products to market across segments including plant-based milk, cheese, ice cream, and yogurt.

Established plant-based meat companies are also leveraging their expertise to produce plant-based dairy. NotCo launched a plant-based milk product in the US in November 2020, and Impossible Foods announced the development of plant-based milk in October 2020.

Only two plant-based egg startups have launched their products, a leading cause of the lack of funding in the sector. Eat JUST leads the industry with USD 220 million in funding and a widely available “JUST Egg” flagship product that has already sold more than 50 million egg equivalents since its 2019 launch. Eat JUST’s work in developing cell cultured meat is also a significant reason for its industry-leading fundraising efforts, becoming the first global firm to bring a cell cultured meat product to market in Singapore in December 2020.

Ingredient Supplier

?

Disruptors

?
Funding in USD Millions
Perfect Day
362
Remilk
11
Above Food
Unknown

Milk

?

Disruptors

?
Funding in USD Millions
Oatly
Public - Market cap USD 9.7 bn
Impossible Foods
1592
NotCo
360
Califia Farms
340
Ripple Foods
246
Turtle Tree Labs
9
Malk Organics
8
Rebel Kitchen
Unknown
Next Meats
Unknown
Watchlist
?
VLY Foods
Sproud
EVR Foods
Heartbest Foods
Mighty Pea
Goodmylk
BioMilk
Uproot
Mohjo
NuMilk
Qwrkee
The Bridge Bio
DRYK

Cheese

?

Disruptors

?
Funding in USD Millions
Kite Hill
75
Miyoko’s Creamery
59
Good PLANet Foods
12
Nabati Foods
6
Watchlist
?
Formo
Stockeld Dreamery
Mooliss Vegan Cheese
Better Dairy
Heartbest Foods
Grounded Foods Co
Parmela Creamery
Heidi Ho Organics
Pleese Foods
Nuts for Cheese
Tomm Pousse
Willicroft
PlantLX

Butter

?

Disruptors

?
Funding in USD Millions
Califia Farms
340
Kite Hill
75
Miyoko’s Creamery
59
Watchlist
?
Goodmylk

Ice Cream

?

Disruptors

?
Funding in USD Millions
Oatly
Public - Market cap USD 9.7 bn
The Urgent Company
Unknown
Watchlist
?
Eclipse Foods
Nadamoo!
Better Dairy
Sunscoop
Ice Queen

Yogurt

?

Disruptors

?
Funding in USD Millions
Oatly
Public - Market cap USD 9.7 bn
Califia Farms
340
Ripple Foods
246
Kite Hill
75
Watchlist
?
The Collaborative
Yofix Probiotics
EVR Foods
Better Dairy
Halsa

Egg

?

Disruptors

?
Funding in USD Millions
Eat JUST
440
Nabati Foods
6
Next Meats
Unknown
Watchlist
?
Zero Egg
Float Foods
Evo Foods
Yumgo
The Vegg
Le Papondu
Crackd

Perfect Day

Perfect Day produces animal-free dairy products using fermentation techniques. The startup uses microflora (microorganisms such as bacteria, yeast or, in this case, fungi) to create the protein blocks of milk-casein and whey via fermentation, which is later combined with fat and water to produce genetically identical substitutes to animal milk. Perfect Day has developed the microflora to produce milk proteins with a similar genetic blueprint corresponding to casein and whey. The startup launched its first product in 2019, a limited line of animal-free ice cream. Perfect Day has also developed animal-free substitutes for cream cheese, feta, and cheese spreads, in addition to milk.

The startup intends to focus on ingredient supply and partnerships with food manufacturers, adapting a business-to-business (B2B) model. In May 2020, Perfect Day announced a collaboration with Smitten Ice Cream to produce and launch an animal-free and dairy-free ice cream, which was later called “N’Ice Cream.” Smitten Ice Cream launched four flavors priced at USD 12 for a 16 oz container, on par with the other animal-free ice cream products. Since its first funding round in December 2019, Perfect Day reported a doubling of production capacity while significantly reducing costs.

Segment:
Ingredient Supplier
Total funding:
USD 361.5 million
Competitors:
Remilk
Disruptor Funding History

Ingredient Supplier:

Perfect Day
Remilk

Milk:

Oatly
Impossible Foods
NotCo
Califia Farms
Ripple Foods
Turtle Tree Labs
Malk Organics
VLY Foods
Sproud
EVR Foods
Heartbest Foods
Mighty Pea
Goodmylk
BioMilk
Uproot

Cheese:

The Incumbents

Existing R&D capabilities enable incumbents to develop products in-house

Plant-based dairy: The industry is crowded with a number of companies producing plant-based dairy alternatives using soy, almond, coconut, and oats. Most companies have turned to almond milk as the main protein source for their plant-based dairy products, pivoting from the initial industry favorite of soy milk. In recent years oat milk has gained traction in the market due to the similar taste and texture to cow’s milk.

Major consumer packaged goods manufacturers such as Nestlé have moved on to pea-based beverages which have a similar nutritional profile to cow’s milk and are favored by many disruptors in the industry.

Plant-based egg: Plant-based eggs are a relatively new industry compared to plant-based dairy and therefore has fewer incumbents. No company has brought an all-purpose complete plant-based egg substitute to market so far.

Acquisition

In-house development

Nestlé
check
Unilever
check
Starbucks
check
Danone
check
Springfield Creamery
check
Grupo Mantiqueira
check
SunOpta
check
Koita
check
Plenish
check
Upfield Group
check
check
Little Bean
check
Salt & Straw
check
Nestlé

Nestlé has a strong presence in the plant-based food industry with a range of products in both the plant-based meat and plant-based dairy industries. In the US, Nestlé’s Haagen Dazs brand debuted its non-dairy line of ice creams produced with soy, almond or cashew milk in 2017. Haagen Dazs is owned by Froneri International, a joint-venture formed between Nestlé and PAI partners (a private equity group based in France) in 2016.

Nestlé-owned, Coffee Mate launched its first vegan creamer line “Natural Bliss” in 2017 with flavors such as Hazelnut Almond Milk, Caramel Almond Milk, and Sweet Crème Coconut Milk. In 2019, the brand expanded the product line by introducing “Half & Half” creamer made from almond milk and coconut cream. Two new flavors are expected to be added to the Natural Bliss line in January 2021.

In July 2020, Nestlé launched a plant-based substitute for condensed milk under its Carnation brand. The product labeled “Carnation Vegan” is produced from a blend of oat and rice milk. The product can be used to replace condensed milk when making dairy or caramel-based sweets and desserts. According to Nestlé, its Carnation Vegan mimics the taste, texture, and appearance of condensed milk made from cow's milk. 

Also in 2020, Nestlé launched its first fully pea-based beverage under the Nesfit brand in Brazil. The company claims the product includes as much protein as cow’s milk per serving, and includes significantly less sugar compared to similar products.

Notable Investors

Funding data are powered by Crunchbase

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