Chinese plant-based meat substitute start-up Zhenmeat is looking to raise around $2 million of funding this year as it expands across the world's second-largest economy and fends off a potential challenge from U.S. rivals.
Zhenmeat founder Vince Lu told CNBC on Monday that the company is "talking aggressively" with investors from Europe, the U.S. and China about the funding round. The less than one-year old start-up has already raised around 5 million yuan ($723,181).
The company's main product is plant-based mince meat made mainly from pea protein in both pork and beef flavors. But it also did a trial mooncake — a popular snack eaten during China's Mid-Autumn Festival — last year.
China is a huge market opportunity for plant-based meat alternatives. The industry in China was worth about 6.1 billion yuan ($883.8 million) in 2018, reflecting 14.2% year-on-year growth, according to The Good Food Institute, a nonprofit that promotes plant-based alternatives to meat. The U.S. market stood at $684 million in 2018.
But Zhenmeat and other Chinese food tech start-ups will have to face challenges from larger, more established U.S. rivals, who have expressed their intentions to jump into the Chinese market.
Impossible Foods CEO Pat Brown told CNBC last year that China is a "huge opportunity" for the company. It recently launched a pork alternative. China is the world's largest consumer of pork. Meanwhile Beyond Meat aims to start producing its plant-based alternative in China by the end of 2020.
Lu believes Zhenmeat will be competitive because its meat alternatives will cater to Chinese tastes.
"And another thing to make us unique is we tailored to our product … to Chinese cuisine. So Chinese chefs and Chinese customers can make a lot of Chinese dishes out of this meat mince like dumplings," Lu said.
He added that the entrance of U.S. rivals will be good for increasing the exposure of plant-based foods.