Most investment funds are, first and foremost, about making money. Not New Crop Capital, a venture capital fund started by animal-welfare activists to support entrepreneurs whose products will save the lives of cows, pigs, chickens and fish.

Launched last fall, New Crop has raised $25m and is investing in companies like Beyond Meat, which makes plant-based substitutes for burgers and chicken, and Purple Carrot, a startup that home delivers vegan meal kits. The money comes from an investor who wishes to remain anonymous.

New Crop’s managing trustees are Bruce Friedrich, who worked for 20 years for activist groups People for the Ethical Treatment of Animals (PETA) and Farm Sanctuary, and Nick Cooney, a founder of The Humane League who is now director of education at Mercy for Animals. The firm’s investment manager is Chris Kerr, a veteran entrepreneur and investor who previously worked as entrepreneur in residence at the Humane Society of the United States.



The goal of the fund is to eventually replace animal agriculture with plant-based and cultured alternatives, according to Friedrich, who has been a vegan since reading Diet for a Small Planet as a teenager.

Friedrich and Cooney operate out of Washington DC, and launched the fund because they believe that markets may be as powerful as morals when it comes to alleviating the suffering of farm animals.

Friedrich says animal welfare advocates have to date been largely focused on educating consumers about the harms of animal agriculture. “But most people make their dining choices principally around the factors of taste, price and convenience,” he says. “We’re focused on making plant-based and cultured alternatives tastier, cost competitive and more convenient.”

New Crop has plenty of company. Over the years, several Silicon Valley venture funds and billionaire investors like Bill Gates and Li Ka-Shing have invested in startups such as Beyond Meat, Hampton Creek and Impossible Foods, which sell or intend to sell alternatives to conventional meat, dairy and egg products.

New Crop’s investments are small, typically $50,000 to $1m. Besides funding, Friedrich, Cooney and Kerr provide their portfolio companies with access to like-minded investors and to consumers who want to avoid meat. “We’re connected with all the leading organizations in the US and abroad that promote plant-based eating,” Cooney says. “We can help our companies get the ear of the early adopters.”

Already, New Crop is working closely with Stray Dog Capital, a mission-driven fund created by animal welfare advocates. Stray Dog was co-founded by Chuck Laue, a senior executive at tech company Asurion, and is led by Lisa Feria, a former brand manager for Charmin and Puffs at Procter & Gamble.

The Humane Society has also put its money where its mouth is by making small investments in Beyond Meat, Veggie Grill, a small chain of meat-free restaurants and Miyoko’s Kitchen, which makes vegan cheese. It also helped Hampton Creek and Daiya Foods, which make plant-based dairy products, get off the ground. “Our fingerprints are on a lot of growing companies out there,” says Kerr, who worked at the Humane Society from 2007 to 2014.

While all these investors are mission-focused, they fully expect to make money. “We would not be putting many millions of dollars into it if we didn’t see it as lucrative opportunity,” Cooney says. All profits from New Crop will be reinvested or distributed to animal welfare nonprofits.

Investors are optimistic about plant-based products that compete with meat, dairy and egg products because they are one of the fastest growing segments of the food industry. According to Radiant Insights, a research firm, the global meat substitute market, which was worth about $3.34bn in 2014, is expected to grow by 7.5% a year and reach $5.8bn by 2022. That’s still a very small fraction of the global meat market, which is estimated to be worth about $675bn by the US Meat Export Federation.

By comparison, plant-based milks, mostly almond and soy milk, make up about 8% of the milk industry. “Plant-based meat has started its trajectory to meet, match and surpass plant-based milk in market penetration,” says Friedrich.

The conventional meat industry has taken notice. The March issue of Meatingplace, a magazine that serves the red meat and poultry processing industry, has a cover story about alternatives headlined “It Ain’t Meat, Babe”. Beef consumption has been falling in the US since the 1970s, although chicken consumption is way up.

John Haugen, who leads the venture investing arm of food giant General Mills, which invested in Beyond Meat, explains: “If you look at the overall trends – half the population is trying to avoid meat and yet there’s a continued demand for protein. And they’re avoiding meat for many reasons – whether environmental, health or cost.”

Besides Beyond Meat and Purple Carrot, where former New York Times food columnist Mark Bittman is a senior advisor, New Crop’s portfolio includes Miyoko’s Kitchen and Lyrical Foods, which sells plant-based cheese and yogurts under the Kite Hill brand.

New Crop has also also invested in Memphis Meats, which is developing technology to cultivate animal cells and grow real meat without animals, and Gelzen, which is making a vegan gelatin. Neither have products on the market yet.