Bud Light maker sees another life for recycled grain: Snacks

Source: By Alexis Benveniste, Bloomberg • Posted: Friday, March 15, 2019

The maker of Budweiser and Stella Artois is looking to get extra mileage from its brewing operations in an unconventional way: using recycled protein to help make snacks.

Anheuser-Busch InBev’s ZX Ventures innovation arm has been backing a snacking startup called Protes that’s working to develop a way to turn the protein in spent grain from the beer giant’s brewing process into salty treats. Protes, which already makes pea protein-infused chips and popcorn, aims to have a product using the beer byproduct on the market early next year, according to co-founder Krik Angacian.

The spent grain is currently repurposed as animal feed — but the new technology in development will let the company turn it into a higher-margin product. So-called upcycling, or reusing discarded ingredients or materials to add value to new products, is part of an increasing focus on sustainability that’s spreading across the consumer landscape. With food and beverage companies struggling with changing consumer tastes and competition from upstarts, they’re seeking new ways to connect with shoppers.

“We are looking for opportunities to repurpose waste streams, such as the protein in spent grain,” says Tom Allison, head of investment strategy at ZX. Protes, which is the venture arm’s only food investment, “specifically fits into the upcycling part of our portfolio.”

Innovation units and venture funds charged with finding the next big thing have become popular among big food and beverage companies in recent years. The ZX Ventures portfolio also includes craft beer brands and non-beer products like Kombrewcha and Master of Malt, a technology platform for ordering whiskey online.

Those investments are bearing fruit: The unit accounted for 10 percent of Anheuser’s growth in the most recent quarter. ZX Ventures first backed Protes in 2016, as consumers were increasingly turning away from carbs and sugar, and embracing protein in meals and snacks.

Protes, which are sold in about 10,000 stores nationwide, was founded in 2013 with an aim to expand high-protein snacking options beyond shakes and bars. Earlier this year, the Brooklyn-based company rolled out new packaging and a revamped chip line in a bid to broaden the reach beyond bodybuilding bros to more mainstream customers.

“Initially, we went after more fitness-minded folks,” Angacian says. “But as the brand has grown, so has the healthier movement of our customer base.”