Drake-ing It In: Musician Joins $40M Raise for Plant-Based Daring Foods

Just nine months after raising $8 million in funding, plant-based meat brand Daring Foods announced last week that it had closed a subsequent $40 million in funding. The round was led by D1 Capital Partners with existing investors Maveron and Palm Tree Crew, along with musician Drake, also taking part.

CEO and co-founder Ross Mackay attributed the need for more capital to a recent growth spurt. Founded in 2018, Daring only launched its plant-based chicken alternatives in 2020. Since then, the company has added distribution in over 1000 retail locations, including Costco, Fresh Thyme, Wegmans and Kroger. It’s also launched on ecommerce site Imperfect Foods, shipped in some Sun Basket meal kits and used in direct-to-consumer meal delivery programs by Trifecta Foods and Fresh n’ Lean.

“It was just a reflection on where we were as a company,” Mackay said, “[We’re at] sort of an inflection point of what we needed to do to capitalize on becoming a market leader in chicken.”

The capital will be used to increase hiring — the company has grown from 20 staff last fall to roughly 50 — while supporting retail execution and increasing capacity for production. Daring uses co-packers for some parts of its production, while other elements are done in-house, and Mackay said he would like to bring more production internally.

The main focus of 2021 will be on distribution — landing more placements in retail and in food service for Daring’s original, lemon herb, cajun and breaded frozen plant-based chicken pieces. Mackay said the company has a goal to be in 4500 retailers by year’s end. To that end, while Daring’s R&D team is exploring other flavors and product types, the most immediate innovation will involve possible new pack sizes or incremental product improvements.

The company will also continue to invest in product development that could result in driving the cost of Daring closer to that of chicken. Already, the company has dropped its MSRP from $8.99 for an 8 oz. pouch to $6.99.

One reason Mackay might deviate from his narrow focus: the opportunity to replace fresh chicken. Right now Daring’s products are smaller, bite-sized pieces, and must be kept frozen, while most of the chicken in the U.S. is sold boneless, skinless and fresh, Mackay said. While the company’s R&D team are working on a plant-based alternative, he added that he’s in no rush, with the product ideally launching later this year or, more likely, next year.

Focusing on where the consumer is already shopping is a lesson Mackay has already learned. Originally Daring launched with its flavored and original pieces, wanting to separate itself from the plant-based fray — which predominantly offers nuggets.

“The breaded item has very little lift,” from a consumer education standpoint Mackay said. “It’s a very low barrier to entry for consumers looking to step into this category.”

The plant-based category as a whole is splintered with its messaging to consumers, with brands alternatively emphasizing their products’ benefits for the planet, for animals and forconsumers themselves. Meanwhile, some brands have tried to stand out by emphasizing the high-tech science behind their products or their novel ingredients. While Daring does speak to its impact on the environment, the company has decided to keep its messaging focused largely on consumers: why they’ll enjoy eating the product and what benefits it may bring to their own lives.

“We still live in a very selfish world where we do what’s right for ourselves. And that is a core purchasing decision so health [benefits are] reflected to [our] nutritional profile, to [our] ingredient profile,” Mackay said. “I do see it as Daring’s responsibility to just simplify what is essentially plants, understanding that the consumers are really focused on an experience, and less about how a product is manufactured.”