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How NotCo Leveraged AI to Create Sustainable and Delicious Food
4 takeaways from a Chilean startup going global
Did you know an AI company took 10% of the mayonnaise market within 8 months?
NotCo is a Chilean food-tech startup leading the disruption of the archaic food industry. Their products have already become a staple product in Chile. And after gaining market share in Chile, NotCo has launched in the US. You may have seen the “NotMilk” products in Whole Foods.
Its mission is both audacious and inspirational: “Take Animals Out of Food production while never, ever comprising taste.”
Changing the food culture that has been so ingrained in our cultures for thousands of years is extremely challenging.
However, NotCo’s rise to the challenge is an inspirational story with precious learnings.
Issues in the Food industry
The food industry is vast. The Global Software Industry has a $400 bn market size, only amounting to the global seafood market. However, the global food industry is $4.8tn, comprising 10% of the entirety of human productivity.
But it is an outdated industry with archaic technology and business models. One of the issues with the food industry is in industrial food: malnutrition and unsustainability. Obesity is higher in developing countries and impoverished areas due to processed foods having high addictiveness and high calories. Look at the positive correlation between income level and obesity below. The correlation is stark at high obesity levels (obesity grade 3, BMI 40+).
Another issue with industrial food is the considerable burden on the climate: land use, water use, and CO2 emissions. “Eating one burger has the same environmental impact as driving 10 miles on a gas-powered vehicle.”
NotCo serves to solve both issues by recreating animal-based staple foods with plant-based ingredients that actually taste good. Because, let’s face it, making a conscious switch to veganism or pescatarian is too difficult to continue for the majority of us unless it tastes good.
Forming the dream team
To realize this ambitious dream, the founder Matias Muchnik initially started to research the pharma industry at the University of California, Berkeley.
“I went to Berkeley and decided to go to the biochemistry department and really try to understand the data and the science” — Muchnik
From Berkeley, Muchnik then went to Harvard University, where he met Karim Pichara, an astrophysicist using data science and machine learning to understand the mechanisms of the galaxy.
Muchnik then needed someone with expertise in plants and decided to recruit Pablo Zamora, researching plant genomics at the University of California.
The dream team for NotCo was ready:
- Vision and Dream: Matias Muchnik
- Data Science and AI: Karim Pichara
- Expertise in Plant Genomics: Pablo Zamora
The secret to NotCo is Giuseppe, the AI algorithm formulating the perfect ingredients.
Giuseppe can learn, mix, and match unlimited plant combinations to deliver the taste found in animal-based products. Giuseppe is always becoming smarter, accounting for flavor, texture, nutrition, functionality, color, and perception, all part of the food experience.
For instance, an almond and walnut have a genetic match of 97%. The similarity is high, but there is 3% causing the difference. Giuseppe can understand what you need to compensate for the 3%. It is similar to using Lego brick pieces to build the perfect Lego house.
One of NotCo’s favorite products is NotMilk. To replicate the taste of milk, Giuseppe starts generating a bunch of different recipes. Then, it gives a score to see how similar the recipe is to the actual taste. For recreating milk, below are some of the recipes Giuseppe came up with:
- Most similar: coconut, cabbage, pineapple, pea, chicory fiber
- 2nd most similar: rhubarb, pineapple, soup, mushroom, vanilla (seriously mushroom!?)
- 3rd most similar: rhubarb, cranberry, limeade, vinegar, mushrooms
Giuseppe indeed comes up with some funky recipes, so the Research Chef in NotCo has to test more than 100 recipes every month.
But there is a strong rationale behind the suggestions as pineapple seems to have the same lactones that enhance the creamy notes in dairy milk.
“The texture is like milk and it is very tasty. There is more flavor than the milk you can buy at the supermarket” — World renowned Chef, Sergio Barosso upon tasting NotMilk
The texture and taste is very similar to real cow milk. I like it more than the other nondairy alternatives I have tried. I have found a new favorite. ーNotMilk review on GoDairyFree.Org
As mentioned above the NotMilk has favorable reviews with an authentic flavor overcoming the dislike of plant-based milk. 30% of consumers who try plant-based milk revert back to dairy due to the lack of taste.
The ingredients are also significantly more environmentally sustainable.
After founding the company in 2015, NotCo spent two years developing its first product, NotMayo (a plant-based mayonnaise). With just 7 employees and 8 months after launch, NotMayo became the 3rd best-selling mayonnaise brand by gaining 10% market share in Chile.
After that, NotCo expanded into Argentina and Brazil. Also, they have added NotMilk, NotBurgers, and NotIceCream to their lineup.
The demand behind the product is quite strong, with NotCo forming solid partnerships with companies like Papa John’s and Burger King. NotCo has gotten a 5% market share in the burger market and a 2% share in the entire dairy category in Chile.
US readers may be familiar with the NotMilk as it is available in WholeFoods.
“[Whole Foods] tasted our milk and said, “There’s nothing like this in the United States” — Matias Muchnik
With their substantial success, global investors have been rushing to their door to take a bite. NotCo has raised $115M from international investors such as Bezos Expeditions, General Catalyst, Future Positive Investment (Twitter Co-Founder’s Investment Firms, IndieBio, etc. Valuation is currently estimated at $300mn and is well on its way to becoming the first Unicorn from Chile.
Currently, NotCo is recognized as the #1 Most Innovative Company in Latin America by Fast Company.
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