New Zealand plant-based meats company Sunfed Meats has confirmed it plans to shut up shop as its investors decided not to fund the business further.
Founder and CEO Shama Sukul Lee announced her intention to close the business today (8 April) through a video posted on Facebook and X.
Describing the company as a "complicated manufacturing and cold chain FMCG business", Lee said Sunfed had faced challenges since Covid and needed "a capital injection".
The group, however, did not secure the funds, with its existing investors having "written Sunfed off".
Lee said: "Essentially, a lot of VC investors had jumped into the plant-based gold rush, thinking they could get fast valuation returns, similar to what they're used to in the virtual world.
"Sunfed's VC investors chose not to clear the way for Sunfed but instead held onto their preferential claims, which complicated new capital options for the company".
The company's last capital raise happened in 2018, meaning the business "ran very lean for far too long with not much resources for growth activities, such as distribution and marketing."
Lee added there was no question that "the plant-based bubble" has burst in recent years, and faces "a reality check".
Sunfed manufactured its yellow pea protein-based range chicken, pork and beef alternatives at its production site in Auckland.
Just Food has asked the company to disclose how many employees will be affected by the closure.
The group went online with the products in 2015 funded by an initial NZ$112,000 ($67,424) injection from Lee and her husband, Hayden Lee.
In 2016, the business entered its "market validation" stage with an NZ$1.2m injection from several "interested VCs".
As it entered its "productisation" stage, Sunfed raised another NZ$10m in 2018. Led by the Australian investment firm, Blackbird Ventures, the investment helped it scale production through a new "hygienic food facility, novel manufacturing lines and FMCG supply chain" at its Auckland factory, said Lee.
According to New Zealand Companies Office, Sunfed's other shareholders include British businessman Jeremy Coller, local broker Jarden Securities Limited and US VCs Stray Dog Capital and New Crop Capital.
Sunfed was formerly stocked in retailers such as Countdown Supermarkets in New Zealand and Coles and Woolworths in Australia.
Inventory in Australia ran dry in January, Lee said, with its meat-free whole cuts no longer available in retailers there.
Stock in New Zealand is expected to be exhausted "in the next two months", she added.
