At one point not so long ago, such waste-based products were novelties for the Whole Foods set. But in the past three years, there’s been an explosion in the number of start-ups making products from food waste, according to a new industry census by the nonprofit coalition ReFED.
The report, which was released Tuesday and tracks a number of trends across the food-waste diversion industry, found that only 11 such companies existed in 2011. By 2013, that number had doubled, and ReFED now logs 64 established companies selling ugly-fruit jam, stale-bread beer, and other “upcycled” food products.
The companies have diverted thousands of pounds of food waste from landfills, a major source of greenhouse gas emissions. They’ve also become a model for larger, multinational food companies, which are starting to realize that upcycling peels and piths can be good business.
“What was once considered 'waste' — or an accepted cost of doing business — is now seen as an asset and revenue generator,” said Chris Cochran, the executive director of ReFED. “As companies begin to track, measure, and understand food loss and waste, the economics of food waste solutions begin to look a lot more attractive.”
Dan Kurzrock, the 27-year-old co-founder of San Francisco start-up ReGrained, suspected that from the beginning. As a college home-brewer, making beer in his garage, Kurzrock noticed that a whole lot of nutritionally valuable “spent grain," mostly barley, gets thrown out.
Kurzrock and his business partner, Jordan Schwartz, spent the next five years testing possible uses for it. In 2016, they formally launched a line of snack bars made from almonds, oats, quinoa and grains sourced from urban brewers.
“We're a food business with an environmental and social mission,” Kurzrock said. At times, reconciling the two has been a challenge.
“Our business is about tackling waste — but how do we do that without grossing people out?” He asked. “That's been part of the complication of dealing with this issue … although it seems like perceptions have shifted.”
On the other side of the country, in Providence, R.I., 55-year-old Erika Lamb has seen similar trends. Her year-old start-up, SecondsFirst, sells fish cakes made from “ugly” produce and “underappreciated” seafood, like skate wing and dogfish. Lamb, who had previously volunteered with a local agriculture group, was surprised by the amount of produce farmers plowed into the ground or fed to pigs, given increasing consumer demand for healthy, local food. For solutions, she turned to a classic New England recipe — which she now sells to nursing homes, soup kitchens and schools.
“For university students especially, it’s a big draw to use food waste now,” Lamb said. She’s already looking toward to expanding into the retail market.
Individually, of course, neither ReGrained nor SecondsFirst is moving the national needle on waste. According to the Environmental Protection Agency, Americans threw away 38 million tons of food in 2014 alone — much of it unbought, unmarketable or unharvested food that was still perfectly edible.
Lamb, who sources directly from area farmers, doesn't currently track the amount of waste that she uses. But her focus is decidedly small-scale and local: She’s determined to keep her prices low, particularly for institutions that serve low-income people.
Kurzrock, meanwhile, puts his impact in these terms: ReGrained sources from five breweries, each of which brews three to five times per week. The company can use the equivalent of one day’s brewing waste, from one brewery, weekly.
“It’s a very small amount of the total amount of waste,” he said. “We’re really just scratching the surface.”
This does not discourage food-waste enthusiasts, though, who argue that Lamb and Kurzrock’s real impact may be behind the scenes. Large, multinational food companies are paying close attention to the business models developed by upcycling start-ups, said Jonathan Deutsch, a professor of culinary arts and food science at Drexel University.
Deutsch’s lab works directly with some of these firms, helping them develop new products and recipes from their waste. Most recently, he and his students have partnered with Love Beets to dream up good uses for the company’s beet powder, such as enriched red velvet cakes. The powder is made from the ground, dehydrated seconds of the company’s main product — packaged beets peeled, cut and sold around the world.
There wasn’t always a market for products like beet flour, Deutsch said. But start-ups have been critical in building that market — largely by persuading customers that “food waste” was a virtuous, and not a gross, ingredient.
“We’re at this phase where there are now proven models, and a lot of interest and excitement,” Deutsch said. Many companies, he added, are “going into their factories and looking at the nutrition they put in the garbage or the compost bin, and seeing if they can get it on shelves.”
That sort of mainstream change could make a big dent in the food-waste problem, ReFED estimates. In a 2016 report, the coalition calculated that “upcycling” efforts could save 102,000 tons of food from landfills each year.
Until that point, however, start-ups like ReGrained and SecondsFirst are eager to lay the early groundwork.
“There are lots of applications for spent grain,” Kurzrock said. "... We're just getting started.”
The next products in his pipeline: cookies and pretzels.
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