Today Kraft-Heinz and NotCo, the food tech company behind the NotCo brand of plant-based foods, announced they are forming a joint venture to develop a lineup of plant-based food products.
According to the announcement, the new company will leverage the strengths of both companies to develop and bring to market a new line of plant-based products. Called The Kraft Heinz Not Company, it will leverage NotCo’s patented AI platform to develop the food products, while Kraft-Heinz will offer up its production capabilities and formidable sales channels to help bring the products to market.
In joining forces with NotCo, Kraft-Heinz is partnering up with one of the hottest new brands in the fast-growing alt-milk category. The Chilean-based startup has secured distribution deals with a number of premium natural and organic food retailers such as Whole Foods, Sprouts and others since entering the US market in late 2020. The deal also gives the CPG stalwart access to the startup’s patented AI product development platform.
And its this AI platform, which goes by the name Guiseppe, which NotCo cites for its fast success in the US market. Guiseppe works by sifting through huge datasets from the US Department of Agriculture’s (USDA) National Agricultural Library and other sources to find ingredient and processing combinations that would best mimic the elements (flavor, texture, etc.) of real meat or dairy in plant-based analogues. The goal is to find the types of combinations that can create a product that completely mimics traditional meat and dairy — a feat few if any plant-based protein-makers have yet to achieve.
For NotCo, which has seen bigger CPG brands like Danone attempt to mimic its playful and somewhat irreverent product branding, the JV marks a potentially powerful new way to reach a broader swath of consumers in an increasingly crowded alt-protein market. However, by launching an entirely new set of products into the market with Kraft-Heinz, NotCo also runs the risk of potential cannibalization of its existing product lines. The deal announcement doesn’t specify how the new JV will sort out how the two will divvy up retailers, something that could come into play since some retailers will not have shelf space for similar alt-milks from the two brands. It could be that the Kraft Heinz Not Company will focus on new products such as plant-based cream cheese or other categories that play to Kraft’s strengths.
Finally, one wonders if this new JV will set a template for other large CPG brands looking to rejuvenate their product lines as more consumers turn to plant-based diets. Many of the old-school brands are ill-equipped to utilize newer product development tools like AI to create new products, so it makes lots of sense to partner up with ascendant brands well-versed in faster digital-cenric product development methodologies.