Joywell Foods to the rescue
By: Steve Sanger, General Partner at Evolv Ventures
As Thanksgiving draws closer and we think about indulging in a slice of pumpkin or pecan pie, we tell ourselves and our children to be careful about how much sugar we consume.
Sugar is a common ingredient in most of our favorite dessert items (especially during the holiday season), but we argue that it is okay to indulge “a little” given the craziness of 2020. What if you didn’t have to feel guilty about the sugar consumed over the year/the holidays? What if a natural, sweet-tasting sugar alternative was available?
I’m here to tell you that help is on the way. Enter our most recent investment, Joywell Foods.
Sugar, health and why Joywell
We all know that sugar is bad for us. Over the last 10 years, adult obesity has increased by 25% and childhood obesity now impacts 20% of the U.S. population. Diabetes cases have doubled over the last 20 years.
Okay, okay — powerful statistics but wouldn’t the threat of diabetes scare people away from sugar? Actually not and sugar consumption has increased over the last 10 years from 9.9M metric tons to 11M in 2019. On our current trajectory, 44M Americans will be diagnosed with diabetes by 2034. The economic costs associated with diagnosed diabetes have risen is estimated at $327B, which includes $90B in employee costs due to reduced productivity or inability to work due to diabetes [1].
There is no shortage of literature out about the ties between sugar and diabetes. The current path we are on is unsustainable. We need to explore healthier alternatives with a goal to eliminate sugar from our everyday diets. The challenge is that many current alternatives are bitter, need to be augmented with sugar to replicate the current sweetness, or have digestive effects associated with them. (Drumroll please) Joywell Foods and sweet proteins to the rescue!
Health and wellness, as well as sustainability, are cornerstones of our investment thesis within the food tech sector at Evolv Ventures. Given the health challenges associated with sugar, we have been exploring startups focused on bringing healthier, sustainable sugar alternatives to the market. We are excited to have led the Series A investment in Joywell Foods with investment participation from Kholsa Ventures, SOSV, Alumni Ventures Group, Piva Capital, and Mehta Ventures.
The company is led by Karen Huh (CEO), who has worked at Bulletproof and Starbucks Coffee, and Jason Ryder (CTO), who has deep biotech and scale-up experience given his prior roles at Just and Amyris. We love backing passionate founders such as Karen and Jason. Karen wrote a fantastic blog post on her challenges with sugar and Joywell’s mission to eliminate sugar from people’s diets.
Building a sweet protein platform
How does Joywell plan to achieve such an endeavor? Joywell is using sweet proteins and bringing them to market using biotechnology and fermentation. Sweet proteins are derived from plants and can be incorporated into a variety of food and beverage products.
What gets us excited is that these sweet proteins have anywhere from 500–5,500 times the sweetness of sugar. They have a better nutritional value and health profile than sugar and the alternative solutions that exist. Due to the increased sweetness of these sweet proteins, you only need a fraction of it versus sugar, which makes the input cost versus sugar and other substitutes attractive. The company is starting with the Miracle Berry protein (5,500x sweeter than sugar) before rolling out additional sweet protein alternatives that can address a variety of use cases via their protein platform. Continued increases in science and technology will allow Joywell to accelerate the development of their sweet protein platform and bring these ingredients to market at scale.
Comparing sweet proteins to other sugar alternatives out there, we determined that there was a lot of choice, but many of these alternatives fall short in a number of areas. A couple of takeaways stood out:
- Market size — The overall market for sugar alternatives is massive. It’s currently a $15B market projected to grow to $19B in 2024 [2]. Given the size of the category and growth projections, this is not a “winner take all” market. It provides opportunities for multiple players to succeed. In our opinion, Joywell’s development of a sweet protein platform with different functionalities makes them an interesting company for CPGs to explore that have various product offerings/use cases.
- Consumers are demanding natural solutions — The artificial sweeteners market is in decline as consumers seek natural solutions. This is occurring more broadly across the food sector, but it is a major purchase consideration within this category. Many artificial sweeteners are associated with digestive issues, bitterness and ties to chronic illness. Leaf-derived sweeteners have their own challenges. Despite being natural, they are perceived as artificial, unsafe and having a bad aftertaste. Other sweeteners have their own challenges in that some need to be supplemented with sugar to mimic the sweetness of sugar as they are not a 1:1 replacement.
(Cue the superhero music) Why is now the moment for sweet proteins and Joywell?
Sweet proteins are naturally derived from plants with an increased sweetness that don’t compromise on taste or demonstrate the bitterness associated with other sweeteners. Recent developments in fermentation and biotech are enabling food tech startups to bring healthier, sustainable products to market across a wealth of product categories. CPG companies are seeking natural, sustainable alternatives to reduce or replace sugar that don’t compromise on taste.
We’re incredibly proud to be supporting the Joywell team on their mission to replace sugar from our everyday diets. And if Joywell can help the world enjoy sweetness without consequences and guilt, then to quote Superman “My work is done here. Up, up and away!”
[1] Premise Health
[2] Grand View Research
