Meatless Farm is facing financial trouble after an investor they thought was going to make a multi-million dollar investment backed out

Leeds-based food brand, Meatless Farm, has stopped trading and laid off its employees as it prepares for bankruptcy.

The company made vegan sausages, mince, and burgers, which were sold in major UK supermarkets.

According to reports, the brand, which has raised over £40 million in funding to date,  was facing a cash crunch and hired restructuring specialists Kroll in May in hopes of finding a buyer for the business.

It comes amidst increased competition in the plant-based meat market and a wider drop in demand for meat alternatives.

‘The company has not made it through’

Commercial director Tim Offer posted on LinkedIn: “Sadly, my time at Meatless Farm has come to an end… the business has unfortunately made all the teams redundant.”

John Loughrey, the interim finance executive, added:  “It is a shame the company has not made it through this difficult period and I wish all my former colleagues the best of luck for the future.”

Meatless Farm’s journey

Meatless Farm was established in 2016 by Danish entrepreneur Morten Toft Bech in Leeds.

The company became one of UK’s top three best-known plant-based brands and recorded 148% year-on-year net sales growth in 2020.

It went on to sell finished products in 20+ markets in Europe, the US, Canada, Asia, and Latin America.

About a month ago, Meatless Farm revealed its latest product lineup, featuring four new products. It boasted of being the first in the UK to offer branded plant-based meat-filled pasta.

Additionally, the firm unveiled the Automated Plant Machine (APM), which dispenses complimentary plant-based food items, as part of its initiative to promote Veganuary 2023 in January.

However, an industry source told AgFunder News (AFN): “The investor they thought was going to make a multi-million dollar investment backed out and the company ran out of time to get the capital needed.”

The source added that the business needed more than £10m to keep it going and was “rapidly burning through cash”.

Drop in demand

While sales of certain vegan products such as plant-based milks, cheese and yoghurt – continue to do well, Tom Rees, a Euromonitor industry manager and food researcher, revealed that demand for plant-based “meats”  has slowed over the years.

“This stagnation is coming out of the US and is having a negative effect on the global picture,” he said.

To add to its woes, the UK plant-based meat market is highly competitive and Rees said that Meatless Farm was “not a top 10 player” despite it investing heavily in NPD and marketing.

According to The Grocer’s most recent top products survey, Meatless Farm’s growth was eclipsed in 2022 by larger brands in the meat-free space, particularly Richmond.

In the same year, the company held a market share of only 1.2%, while its rival  Beyond Meat had a share of 3.3%.

Sales also slowed down with UK shoppers facing a cost-of-living crisis typically eschewing plant-meat products that cost more than their meat counterparts.

“We’ve had a real glut of products on the market with supermarkets pushing their own ranges and outstanding brands. Now consumers have decided which ones they like,” Rees added.

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