US-based Meati Foods, a player in the alternative protein sector known for its mycelium-based meat products, is preparing for a distress sale valued at just $4 million. This comes on the heels of a significant financial crisis that has shaken the company, which had previously raised a total of $450 million in funding.
The impending sale was disclosed in court filings to the Adams County District Court in Colorado on May 2, revealing that chief executive officer Phil Graves has assigned the firm’s assets to attorney Aaron Garber. The transaction is expected to be completed with a new entity, Meati Holdings, although details about the buyer remain scarce, as reported by BusinessDen.
According to BusinessDen, Garber highlighted that this sale aims to "preserve the operational value of the company" and minimise the impact on creditors and stakeholders compared to a complete liquidation.
Meati's current valuation is a stark contrast to its peak worth of $650 million following a $150 million Series C funding round in 2022. The company had recently expanded its retail presence significantly, doubling its revenue and distributing its products to over 7,000 stores. However, a sudden cash sweep by its lender in February, which removed two-thirds of its cash reserves, triggered a financial crisis that the company was unable to recover from.
This unexpected action led to a Worker Adjustment and Retraining Notification (WARN) being issued to all 150 employees, indicating potential layoffs if immediate funding was not secured. The situation was exacerbated by a breach of financial agreements concerning revenue and gross profit, leaving Meati scrambling for capital.
Meati's challenges reflect a troubling trend within the alternative protein industry. Global investment in the sector fell by 27% in 2024, with plant-based food start-ups experiencing a staggering 64% decline. Despite these challenges, fermentation start-ups, including Meati, saw a 43% increase in funding, indicating a potnetial shift in investor interest towards fermentation technologies.
While the overall market for meat alternatives has contracted, Meati's products, particularly its whole-cut steak, have seen growth, highlighting a nuanced market dynamic where some brands continue to thrive despite broader industry headwinds. Recent data from Circana indicated that Meati’s products were among the top growth items in the meat alternatives category, underscoring consumer demand for high-quality, natural ingredients.
Despite these difficulties, the company was recently named one of North America's most innovative companies in 2025 by Fast Company, highlighting its potential and the recognition it has garnered within the industry.
