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The company’s unique approach and high demand for their mycelium-based deli meats from koji mycelium position them for further growth in the alternative protein market.
Prime Roots, a company specializing in meat analogs made from koji mycelium, has successfully closed a Series B funding round, securing $30 million. The primary purpose of this funding is to expand their line of deli meat-style products. With this latest round, Prime Roots has raised a total of $50 million in funding since its inception. Notable investors in this round include Monde Nissin, a renowned noodle and alternative protein company, as well as tech accelerator SOSV/IndieBio, which previously worked with Prime Roots as part of its accelerator program in 2017. Other investors include Pangaea Ventures, Alumni Ventures, Gaingels, and Hyphen Capital.
While there are several alternative protein companies focused on popular meat categories like hamburgers and chicken nuggets, only a limited number of companies are actively working on deli meats. Prime Roots, founded in 2017 by Kimberlie Le and Joshua Nixon, initially utilized koji to create various meat analogs before eventually focusing on deli meats as their go-to-market option in the previous year.
In November, the Berkeley-based company conducted a small-scale retail launch of their sliceable mycelium-based deli meats and pate-like spreads. Prime Roots reported that their deli meats consistently sell out at these select retail partners, with sales surpassing those of other meat alternatives by five to ten times.
The newly secured funds will enable Prime Roots to introduce its products to a wider range of grocery stores and deli counters. Presently, the company’s product portfolio covers more than three-quarters of the available deli meat options in the market. Prime Roots’ offerings include Koji-Turkey in three varieties, Koji-Ham in three varieties, charcuterie in Koji-Salami, two styles of Koji-Pepperoni, two varieties of Koji-Pate, Koji-Foie Gras, and Hickory Koji-Bacon.
The key ingredient in Prime Roots’ products is koji, a fungus that has been used for centuries in Asian cuisine to create and ferment soy sauce, sake, and miso. Prime Roots utilizes the mycelium, the root structure of the koji fungus, to develop their meat analogs. Koji naturally possesses an umami taste, making it an ideal base ingredient for meat-like products. The demand for deli meats has been steadily rising as consumers seek healthy, convenient, and protein-rich options. During the COVID-19 pandemic, as people stayed at home, sales in this segment experienced significant growth as consumers turned to sandwiches for comfort and sustenance.
Even as the United States transitions into a post-pandemic period, with individuals returning to work and school, sales of deli meats continue to thrive as people resume packing lunches. According to statistics reported by Supermarket News, sliced deli meat sales generated $8.3 billion in the 52 weeks ending on March 31.
Prime Roots firmly believes that having an option available at the deli counter can make a significant impact, considering that residents in the United States consume more deli sandwiches than burgers each year. While other brands like Nestlé’s Sweet Earth, Maple Leaf Foods’ Lightlife, Tofurky, and Unreal Deli offer deli slice products, Prime Roots stands out as the only company that sells its bulk meat alternative to grocery stores for custom slicing. Additionally, Prime Roots’ unique distinction lies in its use of mycelium, as opposed to plant-based proteins, in its meat analogs.