Skip to navigationSkip to contentSkip to footerHelp using this website - Accessibility statement
Advertisement

Jeff Bezos-backed NotCo aims to shake up Australian plant-based food

Simon Evans
Simon EvansSenior reporter

Subscribe to gift this article

Gift 5 articles to anyone you choose each month when you subscribe.

Subscribe now

Already a subscriber?

NotCo, a plant-based food and milk company backed by shareholders including Amazon founder Jeff Bezos, tennis star Roger Federer and Formula One champion Lewis Hamilton, aims to replicate in Australia the fast growth it has achieved in the United States.

Chief executive Matias Muchnick said sales globally had tripled in the past 12 months after an expansion from its home base in South America, with the group’s plant-based milk, burgers and chicken products in more than 10,000 stores in North America.

Matias Muchnick, chief executive of plant-based food group NotCo.  

Mr Muchnick said the early momentum from the group’s NotMilk product in Woolworths’ 970 supermarkets in Australia is promising, and the company has also been working hard to woo Australia’s baristas in coffee shops and cafes.

He said while milk substitutes were a competitive category, he believed NotCo had perfected a recipe for a plant-based milk which tasted like milk from dairy cows.

NotCo intends stepping up its presence in Australia with plant-based burgers and chicken nuggets.

Advertisement

The company, established in Santiago in Chile six years ago, uses local manufacturing partners in the countries in which it operates, but is importing the NotMilk and NotBurger range for now in Australia. That will change once early sales targets are hit.

“We don’t own any manufacturing facilities,” he said. “It’s very lean, and it’s a capital-light model.”

Star-studded investor base

Mr Muchnick said the plant-based food and beverages market was still in its early stages.

“First movers always have a huge opportunity to introduce the category and have a head start,” he said.

The company has a star-studded investor base, which also includes former Twitter chief executive Jack Dorsey.

Advertisement

Amazon founder Jeff Bezos has invested via his family office Bezos Expeditions. Mr Muchnick said having such a big player on the share register of the group did not bring any extra pressure. All investors, including sports stars Roger Federer and Lewis Hamilton, were looking for a return on their funds, no matter whether they were large or small.

The last major fundraising completed in July valued the group at $US1.5 billion ($2.06 billion).

Machine learning

“We’re a company that is naturally pressured all the time,” he said. “It’s all about execution.”

NotCo uses artificial intelligence and machine learning to replicate the molecular structure of animal-based products and recreate them using plant-based ingredients.

But even the brave new world of machine learning has not fully shielded NotCo from the serious supply chain disruptions, initially caused by the COVID-19 pandemic and worsened by the Russian invasion of Ukraine.

Advertisement

Ukraine produces about 25 per cent of the world’s sunflower oil, an important component of plant-based foods. Mr Muchnick said NotCo had been able to source some sunflower oil from other markets, and had also worked fast to implement substitute ingredients which did not alter the taste or look of the product.

The sharp jump in shipping and freight costs had also proved frustrating. Mr Muchnick said the costs of shipping containers had climbed by between 10 to 20 times compared with pre-pandemic levels.

He said NotCo would branch out into other plant-based product ranges using the “Not” branding. “It’s around the halo effect of being in other categories,” he said.

NotCo is competing against a range of other plant-based food companies when it comes to burgers and chicken nuggets. One of the largest is v2food, the plant-based “meat” company backed by Rich Lister Jack Cowin, who built his fortune from the Hungry Jack’s fast-food burger chain.

Main Sequence, the venture capital arm of the CSIRO, is a large shareholder in v2food. The CSIRO’s Main Sequence is also a 39.9 per cent shareholder in Eden Brew, which is preparing to commercialise a “milk” made in a lab using a natural fermentation process which replicates what happens inside a dairy cow. NSW dairy co-operative Norco is the second-largest shareholder in Eden Brew.

Simon Evans writes on business specialising in retail, manufacturing, beverages, mining and M&A. He is based in Adelaide. Connect with Simon on Twitter. Email Simon at simon.evans@afr.com

Subscribe to gift this article

Gift 5 articles to anyone you choose each month when you subscribe.

Subscribe now

Already a subscriber?

Read More

Latest In Retail

Fetching latest articles

Most Viewed In Companies