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Transforming sunflower seeds into sustainable, cocoa-free chocolate has led to the creation of a Munich-based B2B food technology startup Planet Foods (formerly QOA) $30M Series B funding round. Now, the Y Combinator alum is gearing up for manufacturing, with money set aside to expand its production capacity by about 7.5 times. The accelerated round follows a $15.4 million Series A in February.
Currently, the startup produces 2,000 tons of ChoViva, as it calls its cocoa-free, low-carbon chocolate alternative, annually. It plans to increase this to more than 15,000 tons as it adds capacity and begins international expansion outside the initial trio of European markets.
Opening its first production facility in the United States is on the cards. Building on the three home markets (Germany, Austria and Switzerland) where the chocolate substitute is already present in food products aimed at tempting sweet-toothed consumers, it is also looking to launch its products in the UK and France during the first quarter of 2025. ChoViva’s purchases to date include Lambertz, Lindt, Rewe Group and even German train operator Deutsche Bahn, which no doubt serves a lot of chocolate on customers’ tea trays every day.
So far, the startup has about 20 customers for alternative chocolate ingredients, mostly major European food manufacturers but also some American brands. As its capacity grows, it will aim to add more strategic partners as well.
Cocoa, not too sweet
The problem Planet A Foods is tackling is making the staple dessert (chocolate) less environmentally scary. The production of traditional cocoa-based chocolate raises serious sustainability issues, as the crop grows in areas with rainforests, which can be cut down to make way for cocoa bean plantations. Global demand is also outstripping increasingly fragile (and morally fraught) supply, inflating costs and concerns about the future of cocoa beans in a rapidly warming world.
Providing the food industry with an alternative ingredient to chocolate – just like the real deal – that can be baked or folded into snack products like breakfast cereals, candies and cakes is Planet A’s mission. And this is no trivial goal: the startup believes it can avoid annual losses of around 500 million tons of carbon dioxide by shifting mass chocolate production away from cocoa beans to its more sustainable method that avoids deforestation and localizes sourcing of ingredients.
The ingredients it uses to produce ChoViva have been chosen in part because they can be grown locally (oats are another key ingredient) – hence it claims a carbon footprint that is up to 80% lower than traditional chocolate (but note that the upper limit is for the plant-based version of ChoViva which, on Unlike other blends, it does not contain any dairy products.)
“We are not anti-chocolate,” emphasizes co-founder and CEO Dr. Maximilian Marquardt, one half of the fraternal founding team behind Planet A Foods. CTO Dr Sarah Marquardt is the food scientist who developed the process for making cocoa-free chocolate. “This is very important. So we won’t take your (special) chocolates. We take care of all your snack orders — (sweets like) M&Ms, Snickers, Mars, Bounty, you know, all that stuff.”
Fine chocolate is a small market compared to the large, high-volume confectionery business that Planet A Foods targets. In this area, where environmental degradation occurs on a dire scale, the quality of the chocolate used is generally lower, often due to the lower actual cocoa content – hence Marquardt says there is no difference between the taste of the chocolate used and what consumers prefer. They are routinely sold in mass market products. “Indistinguishable,” he suggests.
“My sister Sarah… discovered that 80% of traditional chocolate flavors come from… He treats From cocoa beans, not from the beans themselves. . . If eight out of 10 flavors actually come from roasting and fermentation, why do you need cocoa beans?
Sizing for effect
Economics also make ChoViva an attractive alternative to the industrial food industry, the startup says, since the product is not subject to price fluctuations that can affect cocoa beans as a finite resource. But for such a transformation to happen, the startup must be able to produce its alternative in the quantities demanded by food giants – so there is a long way to go for the team to scale.
At this point, ChoViva’s production capacity still represents an incredibly small fraction of the global cocoa bean crop – which Marquardt points out is between 4 million and 5 million tons per year. So it will take huge leaps in production capacity to achieve the huge positive change in sustainability that Marquardt wants.
“We’ve already got the machines (for this phase of manufacturing). We’re already in the expansion phase, and we already have some real industrial customers, so right now we’re just trying to cope with the demand in Europe,” he says, adding: “We’re automating. We are working to improve processes. We are also commissioning new machines. In addition, we are currently planning another facility in the United States.
They’re also exploring how the company can respond to demand from Asia (Marquardt happened to be on a business trip to Japan when we spoke). But he says they also realize that, as a startup, they need to be focused, too.
“We are a startup… We are not naive. So we cannot conquer the world alone,” he tells TechCrunch. “I think the UK and the US are the main markets we will expand into. However, we have a lot of demand in Asia, so we are currently looking at what we are doing here – and what we can do on our own, and eventually with partners.”
Overnight supply chain
Working in the (semi-)chocolatier business may conjure in your mind quaint images of top-hatted chocolatiers gently whipping up large quantities of the sweet stuff in a charming, rural setting. But don’t be fooled: ChoViva’s manufacturing business is already starting to sweat.
Having everything in place to be able to precisely produce tons of zero-cocoa chocolate to ship exactly when customers needed it required the founders to spend some time in the factory. Marquardt says a big focus for this segment of expansion is automation — so they can reduce the risk of human errors causing problems in the supply chain.
We slept under those machines. . . Every day, our lives become hell due to the challenges we face in the supply chain.
“I think we’re currently at a level – an industrial scale – that no one else is at,” he suggests when asked about the competitive landscape for non-cocoa chocolate. Other startups he name-checked are Foreverland, Nukoko, WinWin, and Voyage Foods. They use different methods and base ingredients (including grains, broad beans, carob, grape seeds, and more) to blend competing non-cocoa chocolate products. So there are a range of styles at play.
In this context, and in fact, for almost any type of startup, success “requires more than just developing a product” — or, in this case, an item in the lab — and Marquardt says this invention component represents only 5% of the challenge they set. For themselves.
“The main challenge is to build production, build quality management, build the supply chain. Every day, two 40-ton trucks leave our factory with our products. This is something that someone else needs to figure out. It is a real challenge,” he stresses, adding: “We have grown Me and Sarah – my sister – are under those machines. We’ve really figured out the supply chain. It’s a big hassle. Every day, our lives become hell due to the challenges we face in the supply chain.
“Most of the other competitors, they have great products, but they need to get it off the ground, and they need to be able to really deliver it to their customers, and that’s what’s ahead of them. It’s very difficult to get 40 tons of chocolate to the customer at the right time, in the right place.” “And with the right recipe, and the right quality.”
Planet A Foods’ Series B was jointly led by Burda Principal Investments and Zintinus, with participation from AgriFoodTech Venture Alliance, Bayern Capital, Cherry Ventures, Omnes Capital, Tengelmann Ventures, and World Fund.
Research and development
Aside from the expansion, the funding will also continue towards further research and development, as the team works on an alternative to cocoa butter, another key ingredient for the food industry. Being able to offer an alternative to palm oil is another goal, as this also creates major sustainability issues. The startup also believes its approach could work to replace other specialty fats used in food production, such as stearin, animal fat, or coconut oil, per Marquardt.
“(Sarah) has developed a kind of complete fermentation platform where we can make bioidentical coconut butter,” he points out, saying that bioidentical in this context “means the right bite, the right snap, the right melting point, the right properties.”
“With our fermentation technology, we can offer bio-identical cocoa butter using fermentation at a much lower price than traditional cocoa butter, and this is truly a game-changer for the future,” he suggests. “I think we are the only company that can actually produce cocoa butter using fermentation at a lower price than natural cocoa butter.”
There’s an extra challenge here, though. For one version of cocoa butter, which Marquardt suggests produces the best range of properties, they use microfermentation. It is a method of biotechnology that involves genetically modified microorganisms. This version of the product must be approved as a new food before it can be sold. Since European regulations are more stringent, it is suggested that it may reach the American market first.
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