Meati Raises $50M “Economic Cushion” For Growth Trajectory
Mycelium-based food startup Meati is rumored to have raised a $50 million Series C extension round, according to an exclusive report from Axios today.
Meati founder and CEO Tyler Huggins confirmed to Axios that the company had closed a new funding round, but declined to confirm the value. An unnamed source close to the deal put the number at around $50 million.
Investors in the round include Bond, Congruent Ventures and Revolution Growth, among others. In June, Meati announced that baseball Hall of Famer Derek Jeter had joined the company as an investor and advisor. The new funds bring Colorado-based Meati’s total capital raised to nearly $300 million to date.
Huggins told Axios the new cash will be used to continue expanding the business and was raised to provide a cushion in the case of an increasingly challenging economic climate next year. After a year on the market, Huggins claims Meati sales are on track to eclipse the eight-figure mark and, by late next year, he believes profitability will be within reach.
Meati’s foray into retail began just as plant-based meat sales were largely decelerating, but the category trend has not stunted Meati’s growth. The brand debuted in Sprouts in July 2022 and this past summer it expanded to Whole Foods stores nationwide, in addition to securing placement at retailers including Meijer and Fresh Thyme. The company also sells into foodservice and is on-menu at all PLNT Burger locations.
That distribution scale has been enabled by Meati’s growing production capabilities, namely its Mega Ranch plant, which became operational in January. The vertically-integrated industrial scale facility allows the company to grow, harvest, process and package its products in-house. The Mega Ranch was intended to help Meati to secure an omnichannel, national footprint by late this year, according to an announcement at the time – a feat which it appears to be on track to achieve.
The facility’s construction was supported by funds from Meati’s $150 million raise in 2022 and is also intended to help the company reach “$1 billion in run-rate sales by 2025.” Meati currently sells four SKUs of mushroom-root meats including Crispy Cutlet, Classic Cutlet, Classic Steak and Carne Asada which retail for $8.99 per two-cutlets.
However, growth has not come without challenges. After opening its new production facility earlier this year, the company laid off about 5% of its workforce in order to continue driving cost-efficiencies within the business. At the time, plant-based category leaders Beyond Meat and Impossible, also laid off portions of their workforces.
Sales volume across the plant-based meat category, but specifically in the refrigerated and produce-adjacent sets, have continued to decline. According to recent Circana data category sales declined 7.3% while volumes dropped 15.6% over the 52-week period ending July 2. To note, Circana data covers grocery, mass, supercenter and club, but excludes natural retailers such as Whole Foods and Sprouts.
