Seattle-based food technology company Rebellyous Foods has raised $9.5 million in new cash, which the startup plans to use to deploy its latest plant-based meat production equipment.
Founded in 2017 by former Boeing engineer Christie Lagally, Rebellyous makes a variety of plant-based faux chicken products, including nuggets, patties and tenders.
Lagally told Startup on Friday that the company has been perfecting its “Mock 2” plant-based meat production equipment, capable of making the dough that is essential to its products and enabling Rebellyous to reach commercial scale production of its food.
“It’s food-processing equipment at its core,” Lagally said. “But the whole point is not using old style meat processing equipment to make plant-based meat, which is not a very good fit.”
Lagally said Rebellyous saw “extraordinary” growth in 2022 among its primary customer — schools in the National School Lunch Program. The company closed the year serving 108 major school districts across the U.S. and is consistently adding more.
“School lunch has been a fantastic place for us because it’s a good match for our model of price parity and profitability,” Legally said. “And you can’t fool kids — it has to be high quality.”
Rebellyous also competes against other leaders in the alternative meat industry by offering its products in grocery stores. Retail is a small percentage of Rebellyous’ business, but the company was in 1,100 stores nationwide at the end of 2022.
Sales of plant-based meat slid last year, partly due to inflation and consumers wary of paying a premium for meat alternatives, Bloomberg reported in September. Some of the industry’s leading companies including Impossible Foods and Beyond Meat are also cutting staff. And there are growing concerns about the health benefits, Bloomberg noted in a feature story last month titled: “Fake Meat Was Supposed to Save the World. It Became Just Another Fad.”
Impossible released its own chicken nuggets in 2021 and last year expanded sales of the product to Canada.
Rebellyous, which has raised approximately $30 million to date, employs about 20 people and has openings for a few more. It has no plans to trim its workforce.
“Everybody’s really critical to the deployment of the Mock 2,” Lagally said. “We’re small but mighty.”
After a big week for her former employer and the roll-out of the final 747 jumbo jet, Lagally said she and her team often muse that it’s a lot harder to get a plant-based chicken nugget right than it is to get a plane off the ground.
“Material processing for non-biological materials can be very predictable,” Lagally said. “You can look up how much steel expands and how much aluminum will break, but plant-based meat and crude materials don’t always react the way you expect.”