NUGGS Maker SIMULATE Raises $50 Million

Alternative protein company SIMULATE, maker of plant-based chicken nugget and patty brand NUGGS, announced today it has raised $50 million to fuel new product innovation and grow its retail presence both in the U.S. and internationally.

The funding round was led by venture firm SEVEN SEVEN SIX, which was founded in 2020 by Reddit co-founder Alexis Ohanian, also an individual investor in the brand’s $4.1 million funding round last July. Ohanian, who has also backed plant-based companies Eclipse Foods and Impossible Foods, has joined SIMULATE’s board of directors as part of the deal. Chris and Crystal Sacca, Imaginary Ventures and Day One Ventures, as well as previous investors NOMO Ventures and frozen food company McCain Foods, also participated in the round. The latter, which led a $7 million funding round for SIMULATE in 2019, also manufactures the brand’s products.

The round brings SIMULATE’s total capital raised to $61 million and values the company at over $250 million, according to Bloomberg. The company has said that it plans to use the funding to continue to invest in its production process.

“Historically our food system has rejected the use of technology, resulting in a system that is highly inefficient and primitive,” said SIMULATE co-founder and CEO Ben Pasternak, who has a background as a software entrepreneur. “This new funding will be used to create and protect the intersection of technology and nutrition.”

Since launching direct-to-consumer in 2019 with its first product, a chicken nugget “simulation” made with wheat and soy protein, the company has launched several more iterations of its products in the vein of smartphone app updates. NUGGS 2.0, its latest version, rolled out last summer, and the company also introduced plant-based chicken patties called DISCS, which are available direct-to-consumer. This dedication to constantly tweak and iterate its products has helped it stand out in the increasingly crowded plant-based meat category, Pasternak told NOSH last year.

SIMULATE will use the funding for new innovations and technology, including potentially outside of the plant-based chicken category. The company announced plans for a hot dog alternative line called DOGGS last year, though no launch date has been set thus far.

Since making its retail debut at Gelson’s and independent retailers last year, NUGGS has quickly grown its distribution footprint: both its Original and Spicy NUGGS are now available at more than 5,000 retail locations, launching in Walmart, Sam’s Club and Target in April. The new capital will support further growth, with plans to be in 10,000 retailers by the end of 2021. COO Sam Terris told NOSH in April that the retail expansion was an “important step” in making the product more accessible to a wider demographic of consumers. NUGGS is also aiming to expand into foodservice this year, the company said.

The funding will also be used to triple SIMULATE’s approximately 20 member team and support the company’s expansion in international markets. The geographic expansion started yesterday with NUGGS’ debut in Canada in retailers including Loblaws, Sobeys and Whole Foods. McCain Foods will also produce and distribute NUGGS in Canada.

Pasternak and Terris’ software backgrounds, along with SIMULATE’s demonstrated commitment to rapid iteration and growth, producing products “that can infinitely scale,” will ultimately be key to its future success, Ohanian said in a press release.

“The best technology companies that I’ve invested in over the past decade have operated with similar principles, and we’re excited to see SIMULATE grow into one of the highest impact nutrition companies on the planet,” he said.