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Daily news and analysis about the food tech revolution

chicken nuggets

Why Plant-Based Nuggets are Gold

When I think of chicken nuggets, I think of my young son. More specifically, I remember how at one point I surreptitiously replaced his animal-based chicken nuggets and tenders with plant-based ones… and he didn’t notice (or didn’t care). That small bit of deception is why I think the plant-based chicken nugget market could be a very big deal.

Plant-based chicken nuggets are nothing new. Companies like Quorn, Morningstar and Gardein have been selling them in the frozen aisles of grocery stores for years now. But things really heated up this month when both Beyond Meat and Impossible Foods jumped into the faux poultry ring. Beyond, which had previously piloted plant-based chicken with KFC, announced a couple weeks back that its new tenders are available at 400 restaurants across the country. That announcement was quickly followed by the news that Impossible was unveiling its nuggets to potential restaurant customers this week for a fall rollout.

While both of their plant-based chicken products will debut at restaurants, it’s a no-brainer that their nuggets will eventually make it to store shelves. Both Beyond and Impossible spent a great deal of time last year vastly expanding their national retail sales footprint, all the heavy lifting of getting into stores in done, they now just need to roll out their nuggets.

And it’s on the store shelves where things get interesting, as there will be ton of competition. Not only are the stalwarts like Quorn, Morningstar and Gardein already there, but giants like Tyson has its Raised & Rooted plant-based nuggets, and Target has its own Good & Gather brand. Not to mention there is also a new crop of plant-based nugget startups like Rebellyous, SIMULATE, Nowadays, and Daring Foods competing for your dollar.

Competing for your top dollar, that is. Right now, you have to pay extra for plant-based chicken. A quick look at Safeway shows that an 8-ounce package of Raised and Rooted nuggets is $4.99, compared with a 32-ounce package of traditional animal based nuggets for $7.79. That’s almost four times as much food for a few dollars more.

But this is where Beyond and Impossible can help. While both of their burger products are still more expensive than traditional meat, consumer prices for Beyond and Impossible have steadily come down over the past couple of years. It’s a safe bet that the same will happen for their chicken products. With the brand recognition both Beyond and Impossible have, they should be able to quickly gain market share at retail and exert price pressure on other players in the space.

Another big opportunity for plant-based chicken nuggets and tenders is in schools cafeterias, where nuggets are menu staple. The USDA reports that schools served 5 billion lunches in fiscal year 2019, so it’s no surprise that schools were actually one of Rebellyous’ primary markets before the pandemic shut everything down last year. Also consider that this past May, Impossible received the Child Nutrition (CN) Label authorized by the USDA, which will make it easier for schools to purchase the Impossible Burger. With Impossible running pilots programs with a number of school districts across the U.S., it’s a safe bet the company will get the same regulatory approval for its nuggets.

But the big reason plant-based chicken nuggets and tenders will be huge goes back to my son. Nuggets and tenders are really more of a kids’ food (though, who doesn’t love a good nugget?), and if you can create a reasonable facsimile, they aren’t going to care. It’s not like trying to replicate a filet mignon at a fine dining establishment. Creating a plant-based filet requires “muscle” and fat structures. Plus, consumers have a heightened expectation around what a filet is and should be, so the uncanny valley is much greater. Nuggets, on the other hand, are junk food. (I say that with love) There doesn’t need to be a ton of complexity to make a good nugget. Bread it, flavor it, make sure it looks enough like meat on the inside and there you go. Kids will knock ’em back no fuss no muss.

Until now, burgers have been the star of the plant-based meat world, but don’t be surprised if next year plant-based chicken nuggets take center stage.

Photo from Nature’s Fynd website

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Impossible Foods Unveiling Plant-Based Chicken Nugget Next Week

Impossible Foods will unveil a new plant-based chicken nugget product next week, with plans to launch to launch it at restaurants in the fall, according to a story on Bloomberg this morning. The nugget will be made from soy protein and sunflower oil, but will not include heme, an ingredient used in its plant-based burgers to make them “bleed.”

Honestly, it would be more surprising if Impossible didn’t make a plant-based chicken nugget because everyone is getting into that game nowadays. In addition to the smaller upstarts like Rebellyous, Daring, SIMULATE and Nowadays, Impossible’s big plant-based burger rival, Beyond Meat, just announced its own chicken tenders for restaurants last week. With two well-known brands in Impossible and Beyond now getting into plant-based nuggets, what will that mean for those other companies just starting out?

Chicken is the most consumed meat in the U.S., and the Good Food Institute reports that sales of plant-based meat have grown 72 percent over the past two years, with the market now worth $1.4 billion. Combine those two data points and it’s no wonder so many companies are vying for your dollar. The opportunity in plant-based nuggets is also slightly different than plant-based burgers. Kids eat a lot of chicken nuggets and are (at least in my experience) less likely to notice a plant-based substitute. Burgers, however, are enjoyed by kids and adults alike, and adults are less likely to be “fooled” by a plant-based burger analog (or may even be hesitant to try them out at all). Nuggets could also be the tip of the spear for both Impossible and Beyond to get into other breaded chicken products like patties.

Of course all of that hinges on these nuggets reaching price parity with traditional animal based ones. Though the price of Impossible’s burger has come down over the years, it’s still more expensive than actual beef.

An Impossible rep told Bloomberg that unlike with its burgers, the company isn’t using heme for its nuggets because they are a white meat product. Also worth noting in the Bloomberg story is that Beyond’s new chicken tender uses titanium dioxide as an additive, which the In May, the European Food Safety Authority no longer considers safe.

Bloomberg writes that Impossible will be showing off its new nuggets to potential customers next week at a trade show. Like it did with its Impossible burgers, the plant-based nuggets will then first appear in restaurants this fall before heading to retail. One big difference this time around is that Impossible now has an extensive retail network already in place that will make the launch of its nuggets that much easier and faster.

SIMULATE, Maker of NUGGS Plant-Based Chicken, Raises $50M

SIMULATE, the company behind the NUGGS plant-based chicken brand, announced today that it has raised $50 million in Series B funding. The round was led by SEVEN SEVN SIX, with participation from Chris & Crystal Sacca, NOMO Ventures, McCain Foods, Imaginary Ventures and Day One Ventures. This brings the total amount of funding raised by SIMULATE to $61 million.

The company’s first product, NUGGS, is a pea protein-based “chicken” nugget the company launched through mail order two years ago. In March of 2020, SIMULATE launched its nuggets at retail, and in July of last year it introduced its second product, the DOGGS faux hot dogs. SIMULATE has since expanded its lineup with SPICY NUGGS and DISCS (fake chicken patties). According to the press announcement sent to The Spoon, NUGGS are now available at more than 5,000 retail locations. The company will add another 10,000 retail locations by the end of this year.

SIMULATE’s funding comes at a time of growth for the plant-based meat category. According to the Good Food Institute, U.S. sales of plant-based meat increased by more than $430 million from 2019 to 2020, with the market now worth $1.4 billion.

However, it also comes at a time of increased competition, especially in the fake chicken nugget space, and SIMULATE will need its bulked up warchest to compete. The company faces pressure from smaller players such as Nowadays, which just raised $2 million, and Rebellyous, which just expanded its retail presence throughout the Northwest. Then there are the larger players such as Target, which recently launched its own line of plant-based nuggets. Meat giant Tyson has its own line of plant-based nuggets as well.

SIMULATE says it will use the new funding to triple its team, speed up the development of new products, scale up manufacturing, expand its retail presence and expand internationally.

Seattle Food Tech Raises $1M, Will Ship its Plant-Based Chicken Nuggets this Month

Seattle Food Tech, a startup that creates plant-based “chicken” nuggets, has raised a fresh $1 million in capital from investors including Liquid 2 Ventures, Sinai Ventures Fund, Uphones Capital and VegInvest (h/t Food-Navigator). This brings the total amount raised by Seattle Food Tech to $2 million.

Seattle Food Tech separates itself from other alterna-meat companies like Beyond Meat and Impossible in a few ways. First, the company uses a specialized means of production to better replicate the texture of “real” chicken nuggets through a combination of wheat, oil, chicken flavoring and more. The company says it can implement this manufacturing at large scale production.

Large scale production is important, as unlike its competition, Seattle Food Tech is not going after the consumer market and instead targets commercial customers like school and hospital cafeterias. As my colleague, Catherine Lamb wrote earlier this year:

By opting not to sell their nuggets as a CPG, Seattle Food Tech would be able to offer them at roughly the same cost as meat — around $2 per serving. Lagally says that eventually, once they get their volumes up, they might consider putting their products in large grocery stores, such as Walmart and Costco.

Since the time of that article, Seattle Food Tech’s B2B go-to market strategy remains a smart one as competition in the fake meat space has certainly become more fierce. Next year Beyond Meat will go public, and Impossible will bring its heme-burgers to grocery store aisles. Beyond is already rapidly expanding its product line, and by sticking with institutional customers, Seattle Food Tech can sidestep costly marketing battles with better funded companies.

That strategy seems to be already paying off. Even though Seattle Food Tech has only been around for nine months, the company said in a press release that it will start delivering alterna-nuggets to select customers this month.

We had a chance to taste Seattle Food Tech’s nuggets at our recent Smart Kitchen Summit show here in Seattle, and they were actually pretty good! You can check out the company’s Founder and CEO, Christie Lagally in this video from the Summit, talking about the future of meat:

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