Highlighted by the success of well-marketed plant-meat brands like Beyond Meat (BYND) – Get Beyond Meat, Inc. Report and Impossible Foods, the plant-based-food space has courted billions of dollars in inflows and likewise encouraged a host of entrants seeking to seize on the opportunity.
Interestingly, one of the biggest winners in the space as of late is not one of those household names, but rather Vancouver-based Eat Well Investment Group (EWGFF) – Get EAT WELL INVESTMENT GROUP INC Report CA: EWG. At last check, the OTC stock was at $.68 per share, down 6.14% pre-market.
“We have the total supply chain and the technology to know how to make incredible tasting and healthy food. That’s the overriding picture here,” Eat Well Chief Investment Officer Mark Coles said, helping to explain the contrasting stock trends.
“The Company”, was founded on the principle of “how do we feed our families while honoring time-valued health and wellness traditions.”
Coles said, “Not only is it a superior product, less fat, fewer calories, etc., but it also comes with significantly more attractive margins than our competitors.”
Promising Plant-Based Trends
First and foremost, it is crucial to quantify the pace at which the opportunity in plant-based foods is progressing. Per Bloomberg Intelligence, the plant-based-foods market is expected to accelerate to $162 billion in 2030 from $29.4 billion at present.
That pace puts the market on track to easily outpace growth in its protein peers, many of which are seeing demand plateau as consumer tastes shift, environmental concerns abound, and livestock epidemics hurt supply. By the end of the decade, vegetarian options will be near par with other proteins in terms of total market size, a position few could have anticipated even just a few years ago.
Crowded Competitive Landscape
To be sure, the market opportunity available is no sign of assured success for individual companies. As with any major market gap, there is no shortage of firms seeking to deal with the growing demand.
Thus far, longstanding meat-based protein players like JBS SA (JBSAY) , Nestle (NSRGY) – Get NSRGY Report, and Tyson Foods (TSN) – Get Tyson Foods, Inc. Class A Report have attracted adulation from analysts and investors alike for shifting to accommodate plant-based products.
Meanwhile, Beyond Meat and Impossible Foods have inked numerous high-profile partnerships, capitalizing on their marketability. In fact, Beyond Meat has even found itself on the shortlist of meme stocks that traders have taken dearly to over the course of 2020 and 2021.
A recent McKinsey report titled Alternative proteins: The race for market share is on noted that this very type of marketing is pivotal in courting public acceptance for alternative proteins. Additionally, it makes clear that an early-mover advantage is not adequate to maintain market share.
“For companies to win market share in the long term, they must place their bets and invest in the capabilities needed to meet their marketing strategy and the target consumer segments,” the report reads. “Overall, alternative proteins present an exciting development for the entire food industry.”
Eat Well’s Opportunity
Nonetheless, in these key aspects, Eat Well is betting that it still has the formidable field of competitors beat. This confidence is bolstered first and foremost via its vertical integration strategy, which President Marc Aneed sees as the key differentiator.
“Seeing the gaps in the market, where even name-brand companies flag supply security, we’ve solved the scale issue with our key investment in Belle Pulses,” Aneed told TheStreet. “In addition, our food tech play with Sapientia has real R&D that is piloting by year-end, so there is no delay in monetizing our R&D.”
The foundational investments he refers to are Belle Pulses, a processor of pulse crops like dried peas, fava beans, lentils, and chickpeas that shore up the company’s supply chain; and Sapientia Ltd., a snack-food CPG company that helped develop Pepsi’s (PEP) – Get PepsiCo, Inc. Report Cheetos snack line and specifically oversaw the invention of Twisted Cheetos, a type of Cheetos.
For Aneed, the combination of these two ends is critical to creating a vertically integrated market entrant that can compete with some of the aforementioned more well-known names in plant protein.
He added that the company’s youth is causing the name to trade at a steep discount relative to its peers. Additionally, he hypothesized that the firm’s recent name and ticker change will add to visibility and shore up what he sees as the market mispricing the stock.
Still, Aneed was not eager to await more amenable market attention. Instead, he hinted at an aggressive M&A strategy that is likely to make noise in the already noisy industry.
“We are all about creating scale and solving the issues ‘close to the farm’ and in end-consumer products,” Aneed said in an interview. “You can look forward to hearing about upstream and downstream investments as we move forward.”
While he declined to highlight any specific targets, he did share some formative partnership deals and plans. Namely, Aneed pointed to Saskatchewan Food Centre as a key Canadian ally while touching on numerous deals in the works alongside “seed geneticists, food tech pioneers in the extrusion space, and tier 1 CPG companies.”
In terms of financing its appetite for M&A, Eat Well’s latest high-profile shareholder is indicative of more than adequate ability to underwrite a spending spree. On Wednesday evening the firm announced that Khaled bin Alwaleed Al Saud, the son of the “Arabian Warren Buffett,” Prince Alwaleed bin Talal Al Saud, joined the firm as an advisor and shareholder.
“We are incredibly honored to have Prince Khaled join Eat Well Group as a key strategic advisor, shareholder, and genuine supporter of our long-term ambitions,” Aneed said of the new star supporter and likely Saudi Arabia’s most famous vegan.
Judging by the company’s aggressive plans, promising trajectory, and deep-pocketed partners, they may indeed have the honor of welcoming many more shareholders in the near future, especially as an ever-larger segment of the market is enthusiastic about investing in what they eat.
“Food and agricultural infrastructure are the cornerstones of all cultures. Eat Well Group is building a unique ecosystem that can supply these essential cornerstone needs for society,” says Aneed.
Editor’s note: This story is sponsored by Eat Well Group.