Phuture Foods is creating a plant-based pork substitute for the Asian market

We met with a handful of Brinc’s top startups earlier this week, during a visit to the accelerator’s Hong Kong headquarters. The lion’s share of the demos involved hardware products, which has long been the organization’s core offering. Increasingly, however, food focused startups like Phuture Foods have become an important focus.

Whereas stateside companies like Beyond and Impossible largely work to approximate beef, the Malaysian startup has been pioneering on a plant-based pork substitute. The meat is in particularly high demand in the Asian market, where it’s targeting initial sales, beginning with Hong Kong in the next few months and then branching out into Singapore shortly after.

The foodstuff is designed to mimic the taste and texture of pork, using a variety of plants, including wheat, shiitake mushrooms and mung beans. The company has received support from Hong Kong-based angel investors, beginning with online sales, before rolling out to area super markets roughly five months from now.

Phuture’s primary value play is sustainability, and increasing important issue, particularly under the strain of population growth in areas like China. Price wise, it hopes to hit a target of at or lower than that of actual pork products, which could certainly add appeal among consumers for whom ethical and environmental concerns aren’t at top of mind.

The foodstuff is Halal, a key feature for markets like Malaysia and Singapore. The company is also exploring kosher certification, along with chicken and lamb substitutes.

Kencko chugs down $3.4M to help you get more fruit and vegetables in your diet

Kencko, a company that wants to help people eat more fruit and vegetables in their daily life, is entering feast mode after it announced a $3.4 million seed round for growth and product development.

We profiled the company last year, but — for those who missed it — Kencko develops plant-based products that help people eat healthy without having to suffer the pain of horrible tasting food or other extreme eating. That’s to say that its fruit drinks, the company’s first product, include the pulp and vitamins absent in pressed juice but come in a convenient sachet that has been flash-frozen and slow-dried to retain all the goodness. The company says that each packet, which is 20g and mixes with water, contains two of the five-a-day recommendation for fruit and vegetable servings.

Right now, Kencko — which means health in Japanese — is selling the fruit drink with six different flavor options. Founder and CEO Tomás Froes said the plan is to add as many as half a dozen new options before this year is out. Also coming are two new products that, like the drinks, are made from 100% organic fruits and vegetables to, again, make it easy and tasty to eat healthily.

Beyond products, Kencko is also using the new capital to develop its direct-to-consumer strategy. A big focus of that is its mobile app which is currently in beta with early customers but will get a full launch this year, according to Froes.

Kencko products are sold in units but also as a subscription, and that bundle will include a personal nutritionist — from Kencko’s in-house team — who will use data collected in the app to help customers personalize their diet and approach to health. Further down the line, that may include face-to-face appointments in parts of the U.S. and remote-based sessions, added Froes — who runs the 25-person company with co-founder and CBD Ricardo Vice Santos.

Kencko is focused on the U.S. and Canada but it is available worldwide. Customers can buy the fruit drink through a $16 three-day-trial pack, or more committed packages of 20 and 60 sachets, which cost $60 and $150, respectively.

Froes became a vegan after being diagnosed with acute gastritis. He was inspired to start the company in 2017 after a 90% fruit and vegetable diet cleared the condition without medicine — a doctor had previously told him that he would need to be treated with a cocktail of pills for the rest of his life.

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Now, with plant-based brands like Impossible Foods and Beyond Meat booming and increased media coverage of the science and sustainability of food, Froes believes interest in healthy diet options has never been higher.

“There is demand for more transparency and knowledge on ingredients,” he explained in an interview. “The past few years have sparked a completely new revolution around food.”

The investment came from NextView Ventures, LocalGlobe, Kairos Ventures, Techstars, Max Ventures and other unnamed backers. Kencko took part in Techstar’s London accelerator last year.

Cannabis processing startups hope to unlock new chemicals and treatments

Jeff Ubersax knows yeast.

The chief executive officer of Demetrix studied yeast genetics and biochemistry in school and was an early employee at Amyris Biotechnologies, a technology company that was using fermentation to make biofuels back in the early days of the first clean technology boom back in 2008. 

Now, the same technology that Ubersax and Jay Keasling, the celebrated professor from the University of California at Berkeley who co-founded Amyris and Demetrix, used to make biofuels is being applied to the production of cannabis.

The company launched with an $11 million seed round led by Horizons Ventures, a Hong Kong-based investment fund backed by the multi-billionaire real estate mogul Li Ka-shing, to begin commercializing the technology that Keasling had been researching in his lab.

The goal was to refine a process that would enable yeasts to make a range of cannabinoids that are found in the marijuana plant which could be used to develop new pharmaceuticals, additives and supplements for use in clinical and consumer applications. The technology works much the same way as brewing beer. Except instead of fermenting to produce alcohol, the fermentation process produces cannabinoids from genetically modified yeast cells.

While the technology holds promise, it’s still got a long way to go before it becomes competitive with extracts from the marijuana plant, but given new capital infusions the tide is turning.

Demetrix, for instance, has raised another $50 million from Horizons Ventures and Tuatara Capital, an investment firm focused on the legal cannabis industry, to significantly expand its production while simultaneously pursuing initial tests on the efficacy of rare strains of cannabinoids as treatments for certain illnesses.

“Natural cannabinoids have been used for a really long time,” says Ubersax. And last June the U.S. Food and Drug Administration approved the first pharmaceutical derived from cannabis, Epidiolex, as a treatment for patients with epilepsy.

Planted joins the meatless meat melee with its pea-protein ‘chicken’

Imitation meat is poised to expand its presence in our diets exponentially, if the success of dueling faux burger companies Impossible and Beyond are any indication — but where’s the chicken? Planted is a brand new Swiss company that claims its ultra-simple meatless poultry is nearly indistinguishable from the real thing, better in other ways and, soon, cheaper.

Made from only pea protein, pea fiber, water and sunflower oil, the company’s first product, which they call planted.chicken, imitates the texture and flavor (or lack thereof) of chicken meat very closely.

There are no exotic substances or techniques involved, which keeps production simple and vegans happy. It’s created by making a sort of fibrous dough using the ingredients mentioned, then using a carefully configured extrusion machine to essentially recreate the structure of the muscle fibers that make up meat. These are reassembled into larger pieces with a similar texture to a piece of chicken breast.

planted dishesOf course it has different properties than real chicken — having no fat, collagen or other complex animal substances, it won’t cook the same and can’t be simply substituted in any recipe. But for the innumerable dishes where something like a simple grilled and/or chopped chicken breast is called for, the Planted product could be a great fit.

Strangely enough, it all began with perhaps the most unpalatable substance conceivable (don’t worry, it doesn’t go in the food): hagfish slime. This strange substance secreted by the deep-dwelling creatures has interesting properties that attracted the attention of Lukas Böni and Erich Windhab in the food sciences labs of ETH Zurich.

“This amazing natural hydrogel and [Lukas’s] biomimetic approaches strongly contribute to our understanding of meat-like structures today and how they can be mimicked and eventually even improved from a biomaterials perspective,” said co-founder Christoph Jenny.

Böni soon connected with his other co-founders, Eric Stirnemann and Pascal Bieri, who shared an interest in reducing the waste and ecological costs associated with meat production. Though they are not opposed to meat eating fundamentally, they deplore the enormous amounts of land required for it, unethical production methods and other unhealthy byproducts of the industry. Their hope is to convince meat eaters to choose less wasteful alternatives without asking them to compromise on the quality of the food.

Planted as a company was only started last week, though the team has been working for a year and a half on their first product. Böni brought the food science and biological materials knowledge, and Stirnemann is an expert in extrustion techniques; together they were able, after much experimentation, to produce a truly chicken-like substance.

From hagfish slime to chicken-like substance — it doesn’t really sound palatable. But leaving aside that little about food production is really table conversation, the proof of the pudding, as they say, is in the tasting, and tests along those lines have gone very well.

At tests in restaurants across Switzerland, reception has been great, with some consumers unable to tell it apart from the real thing. And this isn’t being substituted for ground chicken in a stew or something — it’s front and center.

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“We put a lot of research into the product to make it extremely close to chicken,” said Jenny. “Hence we price around a premium chicken at this stage. We do see strong potential to produce our product at a lower cost mid-term, given strong economies of scale.”

Getting to that mid-term is the problem, of course, but given the frenzy of demand around fake meat and growing investment in alternative proteins, it probably won’t be hard to find investors. Though the company declined to detail its current funding, its FAQ says it is at the “seed stage,” and, although it is independent from ETHZ, it’s hard to imagine Planted will be leaving the nest without a bit of help from the university that spawned it.

Currently Planted’s chicken substitute is only available at a handful of restaurants while they work out the rest of the business and prepare to scale up. The company is planning to expand its commercial presence next year, so until then keep an eye on the location list and drop by if you’re in Zurich or Bern.

Fish replacement may be the next big wave in alternative protein development

Fish make up 16% of animal protein consumed globally, and demand is set to rise, according to the United Nations’ Food and Agriculture Organization, largely thanks to rising disposable incomes.

But overfishing is hugely problematic – and it’s not sustainable to continue with the way things are. Fish populations are being decimated – including the Pacific bluefin tuna, which is now at four percent of its original size. Industrial fisheries are using large machinery to trawl oceans, which traps and kills many other animals, including whales and dolphins.

In China alone, where demand for seafood dwarfs any other country, demand is rapidly growing. This is partly due to the African Swine Fever outbreak hitting pig farms affecting pork, and causing people to turn to other sources of protein. In addition, the country’s huge long-distance fishing industry continues to expand, depleting fisheries and causing conflicts.

But most of the fish we eat will be farm-raised by 2030. Poorly managed fish farms can cause chemical contamination of water and promote bacteria and diseases that end up in wild ecosystems. Farmed salmon poses a huge risk to the environment when it mixes with wild populations, as this can disturb important ecosystems.

Fish is a hugely important source of protein as we face a growing population and the challenges of food insecurity. But supplying fish sustainably, without depleting natural resources and harming the aquatic environment, is a continuous challenge. Fish is contaminated with plastics, mercury and antibiotics. And fish farming isn’t doing much to tackle food insecurity, as it isn’t reaching the places where it’s most needed.

There is also a long and ongoing debate about fish welfare, and whether fish species are sentient and can feel pain when they’re fished and killed. But research is putting this debate to rest and showing that a number of species demonstrate having long-term memory, social bonding and parenting skills, use tools, learn traditions and cooperate with other species. Most experts agree that fish also have the ability to experience emotions, including pain and fear.

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IZMIR, TURKEY – APRIL 25 : An aerial view of fish farm, raising a new breed ‘Egeli’ fish, in Izmir’s Karaburun district, Turkey on April 25, 2019. ‘Egeli’ fish, cross breeding of sea bream and dentex, are expected to be put on sale in a year. (Photo by Mahmut Serdar Alakus/Anadolu Agency/Getty Images)

But while fish farms in some countries must follow humane slaughter guidelines, there are no standards for wild fishing. And these guidelines are a far cry from their name. The traditional method for killing farmed fish is letting them asphyxiate in air or on ice, which is a prolonged and distressing processes, and is sometimes followed by a stun. The fish are often crowded into one small space, living in poor conditions and often starving. Overcrowded fish are more prone to disease, stress and aggression, which can cause them to lash out at each other and cause injuries. The pens can be a breeding ground for sea lice and disease, and parasites. And there are so man fish subject to this that we’ve lost count. Estimates suggest up to 120 billion farmed fish are slaughtered for food every year.

Although plant-based alternatives for red meat – like the Impossible Burger and Beyond Burger – and poultry – like The Imposter Burger – have been on the rise, when it comes to fish – we’ve fallen behind. Fish is as much a part of our diets as meat from land animals, so it only makes sense for there to be plant-based seafood options available for those who want to cut back on conventional products.

But the tide is starting to change, and we’re now seeing a promising focus on plant-based fish substitutes. Impossible Foods says plant-based fish alternatives are a ‘high priority’ for the start-up, while other companies are developing a number of fish products that are getting closer to mimicking the real thing. Good Catch offer plant-based tuna, Ocean Hugger Foods have developed a plant-based raw tuna, and New Wave Foods have come up with plant-based shrimp – while restaurants are starting to offer plant-based sushi.

There are also innovations with cell-based meat. Start-up Wild Type has developed lab-grown salmon by taking stem cells from salmon and grown them in lab conditions. The company is hoping to get its price down and start selling to consumers. Singapore-based Shiok Meats is developing cell-based crustaceans, including shrimp, crab and lobster, Blue Nalu is growing cell-based seafood and Finless Foods is focusing on growing bluefin tuna in the lab. The start-up says it was the first to produce a cell-based fish in 2017, and hopes to bring its fish to high-end restaurants this year. It also has the added benefit of being mercury-free.

There’s much work to be done around making fishing more humane and sustainable, but this must go alongside efforts to dampen demand. Plant- and cell-based meat companies continue to encourage and support those looking to reduce their red meat and poultry intake – and now there’s growing attention on doing the same for fish. We must make sure there are alternatives available to catch people who have woken up to the damage caused by our growing demand for fish.

Pod Foods gets VC backing to reinvent grocery distribution

Larissa Russell and Fiona Lee founded a cookie startup called Green Pea Cookie in 2014. The cookies were 100% natural, vegan and “handcrafted with love.”

The company failed but not because the cookies weren’t selling. The business couldn’t keep up with the antiquated wholesale food distribution system’s steep costs. Two incumbent players, United Natural Foods Inc. and KeHE Distributors, essentially controlled its only pathway to grocery stores across the country. So the founders shut down Green Pea and focused their efforts on building the tool Green Pea had needed to survive: Pod Foods, a distribution and logistics platform for emerging food brands.

“We were like so many other young entrepreneurs,” Russell, Pod Foods’ chief executive officer, tells TechCrunch. “I had studied government and economics and did the cookie company because I wanted to create something better for the world but we realized there was a much bigger issue at hand and it wasn’t enough to solve for the end product, we needed to solve for the way the product reached consumers.”

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Pod Foods co-founders Fiona Lee (left) and Larissa Russell.

“The distribution system hasn’t evolved since World War II,” Lee adds. “For so many years, there’s been little evolution in this space, even since the advent of technology and the internet.”

Today, Pod Foods is announcing a $3 million seed round led by Moment Ventures, with participation from M12 and Unshackled Ventures to fuel the growth of its software and data-enabled platform. The capital follows a $250,000 pre-seed investment from Unshackled, a venture capital firm that invests in immigrant founders and, if necessary, helps them navigate the complex visa process.

Lee immigrated to the U.S. from Singapore five years ago to double down on Green Pea Cookie. Her business partner, Russell, had been handling operations in the U.S. while she helped build the business from her home country. With Pod Foods up and running, the founders now have the opportunity to bring Green Pea back from the dead. Instead, they tell me their focus and efforts are entirely on scaling their B2B software upstart. Green Pea is gone for good.

Pod Foods is an end-to-end platform that connects retailers with manufacturers, facilitating the overly-complex wholesale-food distribution market. The startup works with a third-party network that handles both fulfillment and logistics to create a tool beneficial to emerging brands, big retailers and consumers. The company charges retailers on a subscription basis and takes a cut of each transaction. The end goal is to simplify an age-old process, allow startup brands the opportunity to sell products inside big retailers and make great products accessible to customers at a lower price.

The San Francisco-based startup has launched in the Bay Area and Chicago. Currently, it’s working with 350 food brands and 100 retailers. With a fresh funding deal, Pod Foods plans to scale 10x in the next 12 months.

“We want to change the way food is distributed,” Russell said. “We want to turn [the system] on its head so the consumer can get what they would like to buy in retail stores at an affordable price.”

Uber Eats invades restaurants with Dine-In option

Tired of cleaning up after take-out or getting hangry waiting at your table in restaurants? Well Uber Eats is barging into the dine-in business. A new option in some cities lets you order your food ahead of time, go to the restaurant, and then sit down inside to eat, a tipster from competing dine-in app Allset tells us. We tested it, and Uber Eats Dine-In even waives the standard Uber delivery and service fees.

Adding Dine-In lets Uber Eats insert itself into more food transactions, expand to restaurants that care about presentation and don’t do delivery, and avoid paying drivers while earning low-overhead revenue. Uber’s Dine-In option is now available in some cities including Austin, Dallas, Phoenix and San Diego where it could save diners time and fees while helping restaurants fill empty tables and waiters earn tips. But it also could coerce more restaurants to play ball with UberEats if their competitors do, eating into their margins.

UberEats Dine In Option

Uber confirmed the existence of the Dine-In option, telling me “We’re always thinking about new ways to enhance the Eats experience.” They also verified there are no delivery or service fees, and restaurants get 100% of tips left in-app buy users. However, we found some items were silently marked up from restaurants’ listed prices in both Uber Eats Delivery and Dine-In options, which could help it make some money directly from these purchases. We also discovered this buried Uber Help Center FAQ with more details.

Uber has been rapidly experimenting with Uber Eats, trying discounted specials, Uber Eats Pool where you pay less for slower delivery, and $9.99 unlimited delivery subscriptions. It’s steadily becoming an omnivore.

How Uber Dine-In Works

Dine-in appears next to the Delivery and Pick-Up options across the top of the Uber Eats app in select cities. You can choose to go eat “ASAP” or in some cases schedule when you want to arrive and sit down. You’ll be shown how long the food will take to prep, distance to the restaurant, your price, and the restaurant’s rating. You’ll then be notified as the order is prepared and approaches readiness. Then you just deliver yourself to the restaurant and add a tip in-app or on the table.

Uber Eats should obviously make it easy for you to hail an Uber with the restaurant as the pre-set destination. An Uber spokesperson called that a good idea but not something it’s doing yet. Back in 2016, Uber tried a merchant-sponsored rides option where you’d get a rebate on your travel if you spent money at a given store. You could imagine restaurants that want to show off their ambiance giving customers some money back if they come across town to eat there.

Uber Dine In

The new feature could spell trouble for other dine-in apps like Allset that’s been in the business for four years. Users might also opt for Uber Eats Dine-In over restaurant reservation apps like OpenTable and Resy. Why waste time waiting to order and for your food to be cooked when you could just show up as it comes out of the oven?

“I think that more delivery players will be tapping into dine-in space. It’s all about convenience and time saving. But it’s going to be very difficult for them, given their focus on delivery” AllsetCEO Stas Matviyenko said of Uber becoming a competitor. He believes dedicated apps for different modes of dining will succeed. But Uber Eats’ ubiquity and its one-stop-shop model for all your dining needs could make it stickier than a dine-in only app you use less frequently.

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With Dine-In, Uber could aid restaurants that are empty at the start or end of their open hours. Last year we reported that Uber Eats was giving restaurants prominence in a Featured section of the app to drive up demand if they offered discounts to customers. Similarly, Uber could let restaurants entice more Dine-In customers especially when foot-traffic was slow by providing discounts on food or subsidized Uber transportation. Better to knock a dollar or two off an entree if it means filling the restaurant at 5:30 or 9:30pm.

And now that Uber Eats does delivery, take-out, and dine-in, it’d make perfect sense to offer traditional restaurant reservations through the app as well. That would pit it directly against OpenTable, Resy, and Yelp. Instead of trying to own a single use case that might only appeal to certain demographics in certain situations, Uber Eats’ strategy is crystallizing: be the app you open whenever you’re hungry.

Canadian startup Sweet Reason has sparkling spin on CBD beverages

Sweet Reason chief executive Hilary McCain says she launched her sparkling CBD-infused water brand because of her own obsession with cannabis beverages.

That obsession, coupled with the lax regulatory environment in Canada where marijuana is already legalized, led the former Boston Consulting Group consultant and longtime food industry insider to launch the sparkling water company.

“The recreational legalization of cannabis was on the horizon. A lot of my mentors and advisers from the food industry were switching over to cannabis… and I believe beverage is the most social and healthiest way to consume cannabis.”

Sweet Reason describes its product as a “premium sparkling water infused with 7mg of… unique form of CO2-extracted CBD.” Its CBD is water-soluble and the company’s drinks contain no sugar, sweeteners, sodium, carbs or artificial ingredients. The company sources its cannabinoid extract from a hemp grower in Colorado and uses a co-packing facility for bottling and distribution.

McCain contends that the beverage is meant to be enjoyed throughout the day as a mild stimulant compared to something like a Red Bull or a soda. But, reader, I’m one bottle into the day already and let me tell you, I’m definitely not going to be able to drink a second one if I want to get anything done.

In January 2018, McCain started the company with a personal investment of a couple-hundred thousand dollars. The money went into market research, brand development and the creation of her CBD-infused concoctions. And when getting a new consumer business off the ground, especially one operating in the regulatory gray area of cannabis and marijuana, the first thing to do is understand the regulatory environment, says McCain.

By the end of the year, she was ready to go to market, but regulatory changes in Canada meant that her home country wouldn’t be the first port of call for the beverage brand. Instead, McCain hit the U.S. market, landing first in New York and selling around the country through online sales channels. 

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After the sales started rolling in, the company began attracting the attention of some pretty heavy hitters in the consumer venture capital market.

Sweet Reason now has $2.5 million in new financing thanks to a seed financing round led by ​Lerer Hippeau — the investment firm behind startups like Glossier, Warby Parker, Allbirds, Casper and Soylent. Other investors included ​RiverPark Ventures and the New York-based consumer internet investor ​Max Ventures. Subversive Capital​, a cannabis investor financed by the Peter Thiel-backed Privateer Holdings, also committed capital to the round. 

“With Sweet Reason, we’re betting on a team that’s laser-focused on delivering superior quality and building a best-in-class brand,” says Lerer Hippeau’s Caitlin Strandberg. “Hilary’s deep domain expertise in the food industry as well as her passion for health and wellness will accelerate Sweet Reason into a category leader.”

While cannabis, cannabis extracts and marijuana have become hot commodities in startup land, many companies are still wrestling with the ways in which they can help undo some of the damage that the criminalization of marijuana and cannabinoid sales previously experienced. Sweet Reason is no different.

“There is a responsibility for cannabis companies and hemp companies by affiliation to support those efforts and initiatives to help remedy the damage that’s been done,” says McCain.

However, her company has not determined what steps it will take to support amnesty for non-violent drug offenders incarcerated for marijuana-related crimes, or how it will address issues of promoting entrepreneurship in the communities ravaged by the “War on Drugs.”

Sweet Reason is planning to donate 1% of its sales to mental health initiatives — something that could wind up benefiting the company if those donations go toward investigating the role that CBD can play in the treatment of mental illnesses.

The company’s sparkling cannabinoid-infused concoctions are available at Dean & Deluca, Westside Market and other upscale purveyors of fancy foods and drinks. The drinks come in three flavors — grapefruit, cucumber mint and strawberry lavender, and retail for $5.99.

Millennials don’t want to get drunk. What do they want? Apéritifs.

Gen Z doesn’t want to get drunk. Millennials are tired of the obligatory after-work drinks.

Haus, a new startup selling apéritifs online, has a solution for them. The company’s beverages have a lower alcohol content than standard hard liquors on the market, which means you can drink one, even a few, without getting wasted. Made from distilled grapes, fresh herbs and botanicals, its natural ingredients and A-plus branding are sure to appeal to the younger demographic.

Launching today with pre-seed backing from venture capital funds Combine, Haystack and Partners Resolute, customers can begin ordering Haus’ citrus & flower-flavored debut apéritif (15% ABV), priced at $70 apiece. The goal, co-founder Helena Price Hambrecht explains, is to be the first fully direct-to-consumer player in an industry dominated by digitally-novice incumbent alcohol brands and distributors.

Haus enters the market at an opportune time. VCs — more than ever — are funneling cash to innovative beverage projects. This year, Bev, a canned wine business, raised $7 million in seed funding from Founders Fund. Liquid Death, which sells canned water for the punk rock crowd, attracted nearly $2 million in funding from angel investors like Away co-founder Jen Rubio and Twitter co-founder Biz Stone. And More Labs, the company readying the launch of Liquid Focus, is backed with $8 million in VC funding, among others.

Haus is run by husband-and-wife duo Helena Price Hambrecht and Woody Hambrecht. The former has established herself in Silicon Valley, developing the brands of consumer-facing companies including the likes of Airbnb, Dropbox, Facebook, Fitbit and Instagram. Woody Hambrecht, for his part, has been a bona fide “booze guy” since a young age, making wine and managing 67 acres of wine grapes at the pair’s Sonoma County, Calif. ranch, where Haus is also headquartered.

Haus co-founders, husband-and-wife duo Helena Price Hambrecht (right) and Woody Hambrecht.

“We joke that it must have taken a Silicon Valley type to marry a wine & spirits guy because no one has done this before; it’s crazy,” Price Hambrecht tells TechCrunch. “I can make something that gets a shit load of users and press in my sleep and I married this wine & spirits guy who understands the compliance, fulfillment, legal and finance elements. The amount we can do together is insane.”

By “this,” she means launch a direct-to-consumer apéritif brand. It’s generally illegal to sell spirits online D2C aside from a small subset of liquors with lesser alcohol contents. Knowing this loophole, many restaurants across the U.S. have begun making cocktails using only this subset of liquors (thus avoiding the steep fees required to obtain a liquor license) but Price Hambrecht says no one has thought to create an online store for apéritifs for fear of going up against the old guard of the alcoholic beverage market.

Because Haus handles every part of the process, including a patent-pending production model, the old guard isn’t an issue, nor is scaling. Currently, Haus is making and bottling its beverages in a 3,000 square foot warehouse just North of the couple’s farm, with plans to purchase another 2,800 square foot warehouse as orders increase. Unlike wine or whiskey, which must age years before going to market, it only takes hours to make apéritifs, simplifying one of the more complex features of the wine & spirits business.

Later this year, Haus plans to raise additional seed capital to launch a subscription product in 2020, begin constructing brick-and-mortar apéritif shops for the millennial and Gen Z cohort and release a second and third product line. Ultimately, Haus wants not only to disrupt the liquor business but provide alternative beverages to young people looking for better options.

“I was going through my own dilemma of drinking,” Price Hambrecht said. “If you’re a person that is career-focused, you’re possibly drinking 4-plus nights per week. I love how it brings people together; it’s a foundation of society, but you’ve got all these downsides. I never want to be drunk, I never want to be hungover.”

“It’s a cultural problem that we are solving.”

Indonesia’s Kopi Kenangan raises a sweet $20M to expand its coffee business

Kopi Kenangan, a startup that wants to make quality, fresh coffee affordable to Indonesian consumers, has raised $20 million as it begins to consider overseas expansion in Southeast Asia.

The round comes courtesy of Sequoia India and Southeast Asia, via the $695 million investment fund it closed last year. Kopi Kenangan previously raised $8 million from Alpha JWC Ventures.

Started in 2017 by Edward Tirtanata and James Prananto, the company aims to bridge the gap between cheap street vendor coffee and drinks priced at the higher end of the spectrum from international chains such as Starbucks — the ‘sweet spot,’ you might say. That delta is a major reason why Indonesia, which is the world’s fourth-largest coffee exporter, has Southeast Asia’s lowest coffee consumption per person, Tirtanata argued.

Kopi Kenangan is also unashamedly local. Rather than lattes, mochas or flat whites, its top-selling drink is ‘Es Kopi Kenangan Mantan,’ a sweet Indonesian coffee that uses palm sugar, among other local Southeast Asian beverages. Ingredients are sourced locally, including four different coffee blends from across the country and organic palm sugar. Tirtanata told TechCrunch that the raw materials aren’t cheap, but they are essential for a “customer-first” company.

Already, Kopi Kenangan has an impressive retail footprint, including 80 stores across eight cities. The company makes use on-demand services like Go-Jek (GoFood) and Grab (GrabFood) which account for one-third of all orders, according to Tirtanata, rather than running its out fleet as some competitors.

Impressively, the business is profitable thanks to a managed inventory and a focus on waste that sees neighboring branches share resources. Tirtanata said that keeping the business sustainable is a key focus even though it is now flush with new capital.

A selection of Kopi Kenangan drinks

With this new funding under its belt, the company is eying significant expansion both nationally and internationally. Tirtanata said the plan is to reach 500 stores by next year, which, he claimed, will include locations in two overseas markets. He declined to name them, but did reveal that hiring is already underway in both countries.

As well as growing its commercial footprint, Kopi Kenangan will use the capital to build out its logistics to support the projected rise in business. (It claims to sell “close to” one million cups of coffee per month, up from 175,000 cups in October.)

Chief on the list is logistics to track coffee supplies and shipments — Tirtanata admitted it’s natural that there will occasionally be some beans that are sub-standard, and this will help root them out — using RFID and other tech. The startup’s development team is also poised to work on a new internet-of-things feature, details of which will come later, and improvements to the Kopi Kenangan apps and digital service.

Unlike newer competitors like Fore Coffee, which takes its cues from China’s Luckin by placing emphasis on digital delivery, Kopi Kenangan is content to use third-party on-demand apps and its own ‘new retail’ experience. Its app enables customers to pre-order coffee for collection at their nearest branch. If they are in an unfamiliar location, it will guide them to the store.