Plant-based chain Burger Goes Against McDonald’s

  • Next Level Burger, which makes plant-based burgers, was founded in 2014 by Matt de Gruyter.
  • The Oregon-based chain, backed by Whole Foods, announced a $20 million funding round on Tuesday.
  • Now it plans to triple its size and steal a share from McDonald’s, de Gruyter said.
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In his 30s, Matthew de Gruyter, an oil and gas Venture Capital (VC), came up with his weekly diet of steaks, Whoppers and beef burritos. he estimates he ate several pounds of red meat a week.

De Gruyter said switching to a plant-based diet made him stronger, more energetic and reduced his stress at work.

But as he examined his work and personal ethics, de Gruyter realized it was a contradiction to have a plant-based diet to reduce carbon emissions while benefiting from the multibillion-dollar oil and gas sector.

“There’s nothing more counterintuitive than going from oil and gas and drilling wells in the ground and polluting the planet to the inherent sustainability of promoting anything plant-based,” de Gruyter told Insider.

In an effort to align her career with this diet, she quit her job and opened a restaurant serving plant-based burgers in 2014.

The quinoa and mushroom burgers were created from recipes by his wife, Cierra.

Plant-based burgers hit $20 million

The brand eventually caught the attention of two key investors: Whole Foods Market and Alex Payne, who was an early Twitter employee.

The couple became the first sponsors of De Gruyter’s Next Level Burger brand, which has grown to nine restaurants in six states.

The restaurant chain announced a $20 million raise Tuesday, led by Payne and his wife, Nicole Brodeur. Next Level plans to use the funds to reach 28 locations by 2025.

De Gruyter’s goals in the fast-growing sector are lofty: to take share from McDonald’s by becoming a brand people flock to because its burgers are not only good for the environment, but also tasty and affordable.

“We want the question to go from ‘Why eat plant-based?’ to ‘Why didn’t you?’ he said.

Plant-Based Burger Chain Opens in Central Oregon

De Gruyter quit his VC job in 2013 and moved his family to Bend, Oregon to start Next Level Burger.

The startup, which started with money it had earned investing in the oil and gas sector, opened in the summer of 2014.

Central Oregon turned out to be the perfect place to try the prototype.

“It’s a Shangri-La of skiing and snowboarding, mountain biking and kayaking, hiking and climbing,” de Gruyter said.

Serendipity played a major role in its expansion. De Gruyter said two months after opening, Payne and Brodeur walked into Next Level Burger.

De Gruyter said Payne and Brodeur, which invests in early-stage vegan and sustainable change companies, made a “seven-figure” investment in Next Level.

The approval allowed de Gruyter to open a second restaurant in Portland in October 2015, where he said “lines were out the door for days” after it opened.

The success of plant-based burgers in Portland put them on Whole Foods Market’s radar

In July 2016, the two companies teamed up to put the plant-based burger inside a Whole Foods 365 store in Lake Oswego, an affluent suburb of Portland.

Whole Foods eventually became Next Level’s “largest investor” with a minority stake, said de Gruyter, who remains a majority shareholder.

The investment was instrumental in the development of Next Level. Six of the nine Next Level restaurants are located in Whole Foods stores in Oregon, Texas, New York, California and Washington.

“Without pioneers like Whole Foods and others, the world would not have been ready for NLB in 2014,” de Gruyter said.

Next Level plans to follow McDonald’s

De Gruyter, who turns 40 this Tuesday, estimated that 80 percent of Next Level’s customers “are flexible and are not vegans or vegetarians.”

“And we love to feed vegans and vegetarians,” he added, “but at the end of the day, you don’t get very far preaching to the choir.”

These restaurants have options. Next Level isn’t the only plant-based or vegan restaurant chain in America. Other chains include Veggie Grill, Plant Power Fast Food and PLNT Burger, which have about 50 locations in total.

Comedian Kevin Hart recently opened a vegan fast food restaurant, Hart House, in Los Angeles.

De Gruyter said he sees other plant-based chains not as threats but as allies.

“Anyone who pushes climate change in the right direction, anyone who pushes sustainability in the right direction, I see them on our side of the field,” he said.

However, fast food chains like McDonald’s, Burger King, Panda Express and KFC that have added plant-based burgers and chicken to their menus are a different story.

“I’m much more interested in getting market share than McDonald’s and Red Robins around the world,” he said.

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