The Bridges Sustainable Growth Fund III (SGF III) managed by London-based Bridges Ventures, has invested £5.6 million (US$7 million) to acquire a majority stake in Vegetarian Express (VE) – a specialty supplier of plant-based foods and ingredients to the food service industry. This marks the ninth investment for SGF III and its second in the food space following its 2014 investment in Wholebake, a health snack bar manufacturer.
Founded in Watford, England in 1987 by David Jonas, Vegetarian Express has a food portfolio of over 1,000 products including tofu, tempeh, quinoa, nuts, spices and pulses that are sold to more than 2,500 catering locations across the UK.
Under the terms of the deal, Bridges will work collaboratively with current VE shareholders, David Jonas and Will Matier, who will both remain involved in the operation of the business. Additionally, Tim Kelly, former COO of Premier Foods will join VE in the role of executive chairman, and Bridge’s partner, Oliver Wyncoll, and investment manager, Emma Thorne will join the VE board.
“VE has built a really strong platform as the go-to supplier of high-quality plant-based food ingredients,” said Tim Kelly, the new executive chairman of Vegetarian Express. “Bridges has a proven track record of helping businesses like VE to scale, in a way that amplifies their impact, so they’re a perfect partner for our next phase of growth.”
The capital will be used by VE to accelerate its growth strategy, expand its portfolio of foods and ingredients, and to create new delivery routes to includes a wider customer base across the UK.
For Bridges, the investment furthers the fund’s goal of facilitating more sustainable living through the reduction of meat production and consumption in favor of diets including more plant-based foods.
Citing a study conducted last year by OC&C that found that 41 percent of UK consumers are working to reduce their meat consumption, Oliver Wyncoll, partner with Bridges Ventures said, “We all believe in the benefits of plant-based products – which are growing in popularity as consumers make more informed health and environmental choices – and VE has the best range available. It’s a great example of a business whose impact will increase in lock-step with its growth.”
Investor Push-Back Against Meat
Alternative and plant-based protein sources have been increasingly on the radar of both consumers and investors alike, as growing awareness of the resource-intensive nature of meat production continues to raises concerns.
Global protein consumption is expected to climb at a CAGR of 1.7 percent, reaching 943 million tons by 2054, according to Lux Research. Over this same time period, alternative protein sources are forecast to command up to a third of the protein market as they fill the void created by slowing growth in meat and seafood production.
Indeed, Bridges became a signatory to the Jeremy Coller Foundation’s alternative protein initiative – a collation of 40 institutional investors with a combined valuation of $1.25 trillion that in September called for the greater adoption of alternative protein sources including plants, insects, algae, nuts, seeds and grains, and lab-cultured meats.
The treatise, “The Future of Food: The Investment Case for a Protein Shake Up” published by the Farm Animal Investment Risk and Return (FAIRR) initiative, claims that over-reliance on livestock production to feed a growing global population would be unsustainable and would “lead a financial, social and environmental crisis.”
“It simply can’t cope with the projected increase in global protein demand,” Jeremy Coller, CIO of Coller Capital and founder of the FAIRR Initiative explained to Meat + Poultry. “Investors want to know if major food companies have a strategy to avoid this protein bubble and to profit from a plant-based protein market….”
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Lynda Kiernan
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