The past twelve months have been turbulent for the alternative protein industry. According to a recent analysis by Green Queen, more than 40 alternative protein companies worldwide have either shut down, merged, or been acquired between September 2024 and August 2025. The wave of consolidation signals a sector that is maturing, but also struggling under economic and consumer headwinds.

This article explores the investment climate for plant-based proteins, highlighting the reasons behind the shakeout, the regions most affected, and what it means for investors and innovators going forward.

A Year of Consolidation

Green Queen classifies every major company transition as a “deal,” whether it be a closure, acquisition, bankruptcy, or merger. By that definition, the tally for the past year is stark:

• 24 acquisitions
• 11 closures
• 4 liquidations
• 2 bankruptcies
• 1 merger

What stands out is that many acquisitions involved companies selling for less than their initial valuations, a sobering reminder of how quickly investor sentiment can shift.

The majority of deals—over three-quarters—concerned plant-based companies, particularly producers of meat and dairy alternatives. This is significant, considering plant-based brands once dominated headlines and attracted billions in venture capital only a few years ago.

Europe and North America Hit the Hardest

The analysis reveals clear geographic patterns. Europe recorded 23 deals, while North America saw 16.

In Europe, one of the most notable developments was the sale of The Vegetarian Butcher in the Netherlands. Once heralded as a pioneer in the European plant-based market, the brand changed hands to JBS, the Brazilian meat giant. This acquisition illustrates how established global players are increasingly absorbing plant-based challengers, consolidating intellectual property and market presence.

In North America, however, the situation was bleaker. Many of the 16 deals involved bankruptcies of start-ups that had raised significant venture capital. These were often companies with strong initial momentum but insufficient resilience to withstand inflation, rising costs, and shifting consumer interest.

Why the Shakeout?

Several factors contributed to the difficult investment climate:

1. Macroeconomic pressures
   Inflation has pushed up costs for ingredients, energy, and logistics. Larger corporations are better able to absorb these increases, while smaller players struggle to remain competitive.
2. Scaling challenges
   Many plant-based start-ups discovered that scaling production is more complex and costly than anticipated. Moving from pilot scale to industrial output often requires heavy capital expenditure and operational know-how that young firms lack.
3. Consumer acceptance
   Despite early hype, consumer enthusiasm for plant-based alternatives has slowed. Taste, texture, price, and perceived health benefits remain key hurdles. As Green Queen notes, reduced consumer acceptance of substitutes directly impacted profitability and growth expectations.
4. Investor recalibration
   After years of exuberance, venture capital has become more cautious. Investors are demanding clearer pathways to profitability, not just bold promises of growth.

Lessons for Investors

The current consolidation is not necessarily a death knell for the industry. Instead, it reflects a transition from hype-driven expansion to market rationalization. For investors, several lessons emerge:

• Quality over quantity: The days of funding dozens of lookalike meatless burger start-ups are over. Investors now seek differentiated technologies, unique intellectual property, and defensible niches.
• Synergies with incumbents: Larger food and meat companies remain keen to expand their protein portfolios. Strategic acquisitions—such as JBS buying The Vegetarian Butcher—highlight the opportunities for exit through integration rather than independent scaling.
• Longer timelines: Returns will not come overnight. The plant-based sector requires patient capital that understands the slow adoption curve of new food categories.
• Diversification within alternative proteins: While plant-based has taken the brunt of the shakeout, other technologies—such as precision fermentation, biomass fermentation, and cultivated meat—are still in earlier growth phases. A balanced portfolio across modalities may hedge risk.

The Intellectual Property Play

One underappreciated outcome of this wave of consolidation is the transfer of intellectual property (IP). Larger companies with stronger balance sheets are actively acquiring start-ups not only for their brands, but also for their formulations, patents, and know-how.

This IP-centric strategy allows acquirers to quickly expand their technological edge while removing weaker competitors from the market. For start-ups, this means that even if independent scaling proves impossible, their innovations can still hold value in acquisition negotiations.

Plant-Based Takes the Heaviest Toll

Of the 40 deals, 28 involved meat and dairy substitute companies. This disproportionate share raises important questions about the viability of plant-based alternatives in their current form.

The narrative of unstoppable growth has given way to a reality check: consumers are not adopting substitutes as quickly or consistently as projections suggested. Price parity with animal-based products remains elusive, and in some cases, consumer trust has been eroded by concerns over ultra-processing and ingredient lists.

Still, the long-term drivers for plant-based proteins remain compelling: sustainability, animal welfare, and the need for diversified protein sources in a growing global population. The challenge lies in bridging the gap between mission-driven innovation and mainstream consumer demand.

Outlook: A Leaner, Smarter Industry

Looking ahead, the plant-based protein sector is likely to emerge leaner but more resilient. Consolidation will reduce duplication and allow stronger players to capture economies of scale.

In the medium term, we may see:

• Greater product diversification, moving beyond burgers and nuggets to seafood alternatives, cheeses, and hybrid products that combine plant and animal proteins.
• Increased regional differentiation, as companies tailor products to local tastes rather than pursuing one-size-fits-all global launches.
• Closer collaboration with retailers and foodservice providers, ensuring better distribution and consumer education.
• Integration with broader sustainability narratives, aligning plant-based offerings with carbon reduction goals, regenerative agriculture, and circular economy strategies.

Conclusion

The turbulence of the past year is best understood as a reset for the plant-based protein sector. After an era of rapid growth and inflated expectations, the industry is consolidating under the pressures of inflation, consumer skepticism, and investor caution.

For entrepreneurs, this moment demands sharper focus, more disciplined execution, and a willingness to collaborate with larger incumbents. For investors, it is an opportunity to identify high-quality assets at more realistic valuations, while supporting the companies that can scale sustainably.

Despite the setbacks, the fundamental case for alternative proteins remains intact. The sector’s future will not be defined by the sheer number of start-ups, but by the emergence of resilient leaders capable of delivering products that consumers truly embrace.

The coming years will reveal whether today’s consolidation is the beginning of a downturn—or the foundation for the next wave of protein innovation.