Nutrition technology startup SIMULATE, best known for its NUGGS brand of chicken-like nuggets made from plants, announced $50 million in Series B funding that will enable the New York-based company to grow and develop new products.
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Seven Seven Six led the round and was joined by Chris Sacca and Crystal Sacca, NOMO Ventures, McCain Foods, Imaginary Ventures and Day One Ventures. The new round gives the company $61 million in total funding since being founded by Ben Pasternak and Sam Terris in 2018, according to Crunchbase data.
As part of the investment, Seven Seven Six’s Alexis Ohanian joined SIMULATE’s board of directors.
As a teenager, Pasternak got into building software and later started his own social media company that he sold when he was 17 years old. It was at that point he became interested in food and nutrition, especially how anti-technology it was, he said.
“Most of it is primitive and an anecdote of turning Food A into Food B,” Pasternak told Crunchbase News. “I wanted to create a company that would simulate animal foods without the animals. I started with chicken nuggets because generally, all culture change starts with younger people, and they often eat nuggets or chicken tenders.”
Since SIMULATE’s last raise in 2020, a $4 million convertible note, a majority of the company’s revenue is from direct-to-consumer. In the past six months, the company’s retail presence has scaled aggressively, and NUGGS are now available in more than 5,000 retail locations, including Walmart, Target, Whole Foods Market and Sam’s Club, he said.
The company also offers three products: NUGGS, spicy NUGGS and a patty offering called DISCS, which are currently only direct-to-consumer.
In addition to product and technology development, Pasternak intends to deploy a majority of the new funding toward tripling the company’s internal team, including hiring engineers, food scientists, designers and artists.
In terms of growth, SIMULATE came into 2021 with under 300 stores and saw a 200 percent increase in its retail footprint. In addition, it entered more than 2,100 new doors in April alone. Although Pasternak intends to add an additional 10,000 stores by the end of the year, he expects that food service and fast-food will eventually be a large part of the company’s revenue.
“One of our core focuses is the aspect of scalability and software,” Pasternak added. “The product doesn’t have meaningful adoption unless 100,000 people adopt it.”
Joe Medved, a partner at Lerer Hippeau, was involved in last year’s investment, and said SIMULATE is doing a lot of product iteration and gained early adoption online, and is now standing out on the store shelf.
“The approach they have taken is tapping into consumer interests with sustainability products,” Medved said in an interview. “That will enable them to bring a range of SKUs to market over time. It is not just a standard plant-based brand, we are developing a new product, and the brand narrative speaks to younger consumers.”
Feature photo of SIMULATE co-founders Ben Pasternak and Sam Terris and inset NUGGS photo courtesy of SIMULATE.
Illustration: Dom Guzman
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