Interview with Dan Altschuler Malek

29th July 2019  

Managing Partner at Unovis Partners & New Crop Capital

Dan Altschuler Malek is Managing Partner at Unovis Partners and New Crop Capital. Dan is passionate about food, startups, sustainability and his endeavors include launching a natural snack company, heading a logistics firm, opening a restaurant and managing a creative agency.

Can you please tell us a little bit about Unovis Partners and New Crop Capital?

Unovis Partners is an investment fund with a clear mission: reducing and hopefully eliminating animal protein in the global food supply chain. Our first fund, called New Crop Capital is an “evergreen” venture fund doing early stage investments in replacements to “center of plate” animal protein foods including beef, chicken, pork, lamb, fish, shellfish, dairy and eggs.  The way the food industry currently works is not sustainable as it significantly damages both the environment and people’s health as well as being bad for the animals. These collateral effects will only get worse as the world’s population increases in the coming years. The solution is to invest in entrepreneurs around the world who are developing fungi, plant and cell based products that will ultimately replace animal products in a way that consumers enjoy. This is the reason why Unovis, through New Crop Capital, focuses on the direct replacement of some of the most harming and common ingredients in our kitchens: meat, fish, shellfish and eggs.

What is your background and what are the dynamics that brought you to the Food Tech Industry and to Venture Capital?

My career has always had food involved in one way or another. I have had what one could call a non-linear career as I have done a little bit of everything. I started in corporate banking and soon moved to logistic, then consulting. After that, I decided to start a food company, then I managed a creative agency, and lastly I opened a restaurant. All these positions had a direct link with either food consumers or vendors. After leaving the creative agency, I wanted to do something that combined my passion for food along with my desire to contribute and have a positive impact on the environment while leveraging technology. Living in San Francisco and reading about the world of alternative proteins made a lot of sense to me as an entrepreneur. As I researched for the main players in the field, I came across New Crop Capital and had a great conversation with Chris Kerr, who later offered me a job. I enjoy working with entrepreneurs of all types and origins as they always bring in a lot of energy and creativity.

What makes the Food Tech industry different from other innovative sectors and what makes it so interesting for you?

The Food Tech sector has existed for a long while. For example, Israel since its foundation after the Second World War the population used technology to improve the crop yields and explore more productive ways to grow food in a desert environment. I see what is currently happening in Israel, the incredible Food Tech hub that sprouts up there, as a direct continuation of that. Moreover, in this moment of time investors have correctly identified the revolution in the food industry that is currently happening as an incredible opportunity to make money. Consumers are finally acknowledging the direct negative link between the food industry and the environment and health. Another element that is very important right now for the Food Tech sector is the sheer amount of tech innovation, which is being applied towards food. From digital tech, solar energy, Artificial Intelligence, to pharma and biotech.

How is the Food Tech industry trying to tackle inefficiencies in the global food chain?

The global food chain has many nuisances: moving raw materials around the globe, managing distribution channels, placing fresh food on the shelves of different points of sales. It is important to remember that these products are perishable and delicate. This entails that people’s health and lives are dependent on the ability of food companies to do their job with safety in mind first. This sometimes brings inefficiencies to the process that would be discarded in other sectors, but that cannot be underrated when we are talking about food. Is not easy to scale food manufacturing and improve distribution efficiency while maintaining quality and prices. Food Tech brings about a completely new way to source ingredients (or more correctly it repursues already existing ingredients) by reproducing cells in the lab to create cell-derived stakes (and a lot more) that are the same as their animal analogue at the molecular level. This will have a huge impact on the global food chain and one can be sure that the entire industry will become more efficient in the future.

What are the main areas of investments in the Food Industry for Unovis Partners and New Crop Capital? Which ones are the most promising in your view?

At Unovis, we focus on five different sub-segments within the food industry: 1) Food Tech: novel ways to produce food with protectable IPs and CPG elements (substitutes derived from plants for food of animal origin); 2) Plant based replacement for meat, dairy, eggs and seafood; 3) Cellular Agriculture: advanced fermentation and tissue engineering to produce animal products at the cellular level; 4) Convenience: distribution systems to increase consumer access to mission aligned products; 5) Exploration of new approaches that fall in line with our investment thesis. However, I believe that all the categories I have just mentioned have great potential without there being one in particular. This is because food is not a winner takes all market. People have very different tastes and priorities in mind when it comes to their diet so there will never be a single dish or product that will conquer everyone’s kitchens.

What are the most interesting companies in your portfolio and what are the major strengths that convinced you to invest in them?

It is very difficult to choose among the companies in our portfolio but if I had to pick four in this moment of time, I would go for Aleph Farms, Good Catch, Zero Egg and Blue Nalu. The first one, Aleph Farms, starts from the assumption that meat is one of life’s pleasures, to be celebrated and enjoyed without the downsides to health and the environment. Aleph Farms aims to offer superior, healthier, slaughter-free bovine meat, providing a new customer experience. The start-up has already developed the first cellular steak ever to be produced, and it tastes great! The second company is Good Catch. Good Catch offers 100% plant-based food. No dairy, no gluten, absolutely no GMOs, and no worries about shellfish allergens, mercury, plastic or microfibers. You will enjoy a protein-rich, nutrient-dense entrée packed with beneficial omegas. Good Catch tastes so much like real seafood you would not be able to tell the difference. The third is Blue Nalu and their mission is to be the global leader in cellular aquaculture, providing consumers with great tasting, healthy, safe, and trusted seafood products that support the sustainability and diversity of our oceans. Blue Nalu will disrupt and supplement the current industry practice, in which fish are farmed or wild-caught in our oceans and seas.  Instead, they will produce real seafood products directly from fish cells, that are as delicious and nutritious as products that have been grown conventionally, in a way that is healthy for people, humane for animals, and sustainable for our planet. And lastly, Zero Egg has developed a plant-based egg with the taste and functionality of a chicken egg. Not all consumers are aware of the amount of eggs used across the food supply, in everything from baked goods and pastas to processed products, not to mention the amount of eggs used in kitchens around the world.  Zero Egg, based in Israel, is launching their product which will have a significant, positive impact on the culinary world.

What is the market’s reaction to the newest Food Industry trends? Speaking about types of consumers, who is already “committed to the cause” and who are you trying to involve more?

The market reaction has been enthusiastic in front of both plant-based and cell-derived products. Speaking about types of consumers, I know that in a recent survey taken by purchasers of Beyond Meat’s products more than half of the participants declared that they choose to eat the company’s plant-based meat because it tastes great and not because they are vegan or vegetarian. What we are seeing in general is that consumers are inclined to shift their eating habits for many different reasons. Some choose these new next-gen products because of their positive impact on the environment, some because of animal ethics, and others still due to the consequences traditional food has on health. In conclusion, there are many different reasons to join the Food Tech revolution and this is why so many people are doing it.