Neat Burger, the Lewis Hamilton-backed vegan restaurant group, has completed a funding round led by SoftBank’s Rajeev Misra valuing the company at $70m and allowing it to push ahead with plans to triple in size.
The plant-based fast-food chain, started in 2019, intends to grow from five London restaurants to 19 dine-in sites and 16 delivery kitchens by the end of 2022 as well as launch its pea protein burgers in several major UK supermarkets.
Ryan Bishti, a nightclub operator who co-founded the business with his brother Zack and Tommaso Chiabra, an early investor in Beyond Meat, said that Neat Burger’s “rule of thumb” was opening one new restaurant each month.
With sites becoming available at cheaper rents, the pandemic “accelerated our expansion plan”, he added. The company also aims to open in Italy, the US and the Middle East.
Neat Burger has not disclosed its annual revenues but said that it expected to increase sales 300 per cent year-on-year as it opened new sites. Sales would be “double digits of millions” in 2022, Chiabra said.
Misra invested part of his personal fortune in the $7m funding round after hearing about Neat Burger from his children, the company said.
Producers of vegan foods have enjoyed rapid growth as consumers become more aware of the health and environmental effects of eating red meat.
But despite large chains such as Burger King and McDonald’s adding plant-based options to their menus, there remain relatively few vegan-only restaurants.
In the UK, the number of sit down restaurants with an exclusively plant-based menu increased from one in 2015 to 92 by the end of June this year, figures from Local Data Company show.
“All the major brands are adding more and more vegan and meat-free content to their menus and I think you will continue to see the specialist offering springing up [but] I question how far they can grow and continue to be specialist or are more just the trend leaders that bring things into the mainstream,” said Graeme Smith, managing director at the consultancy AlixPartners.
Formula One driver Hamilton, a vegan and a founding investor in Neat Burger, said that the idea behind the chain was to make “plant-based eating more accessible to everyone whether you eat plant-based all the time or just want to add it to your diet every now and again”.
Other investors include Anthony Di Lorio, co-founder of cryptocurrency ethereum, and Wellness Holding, which owns the fitness equipment company Technogym.
Bishti said that because Neat Burger did not rely on animal protein and sources all its ingredients in the UK, it had not suffered shortages in that way that other fast-food chains such as KFC and Nando’s had.
Pea protein suppliers warned last month, however, that a drought in Canada could cause shortages of plant-based foods.
Neat Burger’s patties typically cost £9.99 but it said it planned to launch a £1.99 burger next year despite facing increased labour and energy costs.
“We are aware that people are feeling the pinch a bit,” Bishti said.