Negotiations with investors about a new funding round is being conducted the maker of the plant-based Impossible Burger – Impossible Foods Inc, and according to reports quoting sources, this funding round could effectively more than double the valuation reached by the company at the last funding round in May which was at $2 billion.
There is a growing market for alternative meet with is being eyed by the Redwood City, California-based company as well as its rival Beyond Meat Inc, whose share price has more than tripled since it got itself listed as a public company in May this year. The current market valuation of Beyond Meat is about $4.8 billion.
According to the reports quoting sources, a valuation of anywhere in between $3 billion and $5 billion is being eyed by Impossible Foods from the fundraising round with a material amoumt of between $300 million and $400 million.
A larger money raise at a higher valuation is being pushed for by some of the existing investors in Impossible Foods, said reports quoting sources.
Reports also said that a success at this planned fundraising could also prompt Impossible Foods to launch its initial public offering (IPO) sometime next year.
“We need to consider every option for fueling our long-term growth. However, we have not announced any plans or timing regarding an IPO,” an Impossible Foods spokeswoman said but did not comment on any potential fundraising plans.
If Impossible Foods manages to secure the kind of increase in valuation that it is looking out for, it would give clear indications that venture capital investors are still not averse at making huge investments and making large valuations of startups at private fundraisings, even though a number of high profile startups have struggled to perform so far in 2019.
The high valuations during fund raising events that were attributed to ride hailing startups Uber Technologies and Lyft Inc was not replicated by the companies when they listed themselves at the stock market.
In private fundraising rounds in January this year, valuation of as much as $47 billion was given to United States based office-sharing company WeWork but the company was ready to launch its IPO for a valuation as low as $10 billion before ultimately being forced to cancel the IPO launch.
Venture capital investors Khosla Ventures and Horizons Ventures, as well as celebrities like tennis star Serena Williams and singer Katy Perry are among the current investors of Impossible Foods and according to data provider PitchBook, the company has managed to raise $777 million so far in private fundraising rounds.
More than 15,000 restaurants around the world sells its burgers made from plant based neat, says Impossible Foods. It also recently started selling its products at certain US grocery stores.
According to a report by Research on Global Markets, in 2018, the total revenues generated by the global meat substitutes market was at $4.2 billion and the market is expected to have a value of $6.1 billion in revenues by 2023 because of the rising trend among consumers to become vegetarian or reduce the amount of animal meat that they consume. .
(Adapted from Nasdaq.com)