Impossible Foods has raised $500m in a round that will help the US plant-based burger group to weather the economic turmoil caused by the coronavirus crisis.
David Lee, Impossible Foods chief financial officer, said the company needed to prepare for the impact of the coronavirus outbreak. “It’s too early to tell what changes among our customers and consumers will affect our business, but we will be able to withstand any short-term shocks,” he said.
The fundraising, which was led by South Korea’s Mirae Asset Global Investments, and also supported by Li Ka-shing’s Horizons Ventures, Singapore’s Temasek and Khosla Ventures, closed last week and comes as several US states have moved to shut restaurants and food service outlets.
The capital increase came amid the backdrop of instability in the financial markets. Impossible Foods did not disclose its valuation, but its rival Beyond Meat, which floated last year, has lost about half its value from a month ago, trading at $61.80 a share on Tuesday.
Although demand for food is expected to be affected especially at retailers, with restaurant footfall forecast to fall sharply, “the impact on Beyond Meat and Impossible Foods will be huge,” said one investor in Beyond Meat.
The capital increase also comes as the company is pushing into new markets and has applied for regulatory approval in the EU, China, and other Asian markets. It currently sells its patties in the US, Singapore, Hong Kong and Macau.
Impossible Foods said it would also use the funds for R&D and the commercialisation of its plant-based sausage and pork products.
The company has been working on plant-based fish and it unveiled Impossible Pork, a ground pork product at the Las Vegas CES technology conference at the start of this year.
Pat Brown, founder and chief executive, said late last year that while the company had no plans for an imminent public offering, it had the option to do so as it had already done much of the legwork.
“We have been doing all the work that we need to do to operate as a public company, in terms of the legal and financial infrastructure, and the way we manage our business — so that option will exist, if and when we ever decide it is the right time to do it,” he said.