‘Modern agriculture is a broken system and we want to fix that’: Vegan Food Group

Prior to starting his plant-based journey in 2020, Sparrow was not ardent vegan, but rather an experienced food industry figure who spotted an opportunity and ran with it. Today, he is not only leading a major player in the category, but Sparrow is also at the heart of the company’s mission to fix a broken food system, alongside co-founders Matthew Glover and Adam Lyons.

His background in the sector was forged with businesses including Yorkshire Provender, Hain Daniels, Kirsty’s and HECK, where he worked in various finance, commercial and operational roles over a 10-year period.

His first foray into the plant-based category came at Hain Daniels when he worked on the Linda McCartney brand, but it wasn’t until he made contact with Veganuary co-founder Matthew Glover in 2019 that he began to see the vision and need for plant-based food, beyond the commercial potential.

“Veganuary was growing in prominence and I had been aware of Matthew for a while,”​ Sparrow told Food Manufacture.

“So, when I learned that he was based in York, I reached out and we set up a meeting.”​

At the time of their meeting Glover was setting up VegCapital, an investment platform designed to support startups in the vegan space, but also expressed an interest in founding a plant-based southern-fried chicken brand in the shape of VFC Foods (Vegan Fried Chick*n) alongside York-based chef Adam Lyons.

“I wasn’t particularly immersed in the plant-based sector at this stage, but once I started working with Matthew and Adam I really began to understand their vision and the mission they were on,” ​Sparrow explained.

“I started by supporting on VegCapital and then transitioned into the role of CFO at VFC supporting with fundraising so that we could get the business off the ground.”​

Growing VFC

VFC was initially run as a direct-to-consumer business operating out of Lyons’ restaurant, producing small batches and shipping them out. Glover and Lyons had employed a design agency to create a distinctive look for the brand, but it was not until Tesco showed an interest in the autumn of 2021 that things began to take off.

“We travelled to Welwyn Garden City to pitch VFC and they agreed to stock our products and loved our approach,”​ Sparrow recalled.

“At this stage I went full-time and began the process of finding a new manufacturing facility as we could not meet the demands of Tesco out of Adam’s restaurant, Source.”​

This process proved a challenge given the ongoing pandemic and the firm’s status as a start-up, but eventually Sparrow came to an agreement with a manufacturing partner in Canada that would allow VFC to fulfil its agreement with Tesco.

Things snowballed from there and within six months Sainsbury’s and Asda were stocking VFC products.

“We were growing well but I felt passionately that we needed to invest in product quality to rival brands such as Quorn and Linda McCartney that were selling at a lower price point,”​ Sparrow said.

“To achieve this we raised additional capital, invested in the texture and taste of our chick*n product and moved our manufacturing operation to Germany. This really paid off, causing our existing partners to increase the distribution of our products and new retailers such as Waitrose and Morrisons taking us on.”​

The success of VFC was not limited to the UK at this point as it established a presence in the Netherlands and Spain too. It was this growth that allowed the founders, Matthew and Adam, to consider the greater impact they could have on the food system as we know it.

“In early 2023 we saw the plant-based market begin to consolidate following a period of investment and growth, which had led to the category becoming very crowded,”​ Sparrow explained.

“Some brands had weak products, while others priced their items to high, and this led to competitors being unable to deal with the headwinds of rising input costs. Meanwhile, we had one investor in the shape of VegCapital that was committed to growing the sector, whereas many rivals were reliant on multiple different investors that pulled out once trading conditions became more challenging.”​

Acquisitions and Vegan Food Group launch

In June 2023 VFC made its first move by acquiring Meatless Farm out of administration​​, a deal which Sparrow saw as having numerous benefits.

“Meatless Farm had great brand awareness and a line-up of strong products, it was established in the chilled fixture while we solely focused on frozen at that time,”​ he said.

“It also produced plant-based beef, pork and lamb alternatives, which complemented our VFC chick*n range perfectly. We also used many of the same facilities and raw materials, which made the integration pretty seamless, while being able to optimise on economies of scale.”​

A few months later and VFC added to its portfolio with the addition of pie maker Clive’s Purely Plants​​, a move that stretched the business beyond plant-based meat alternatives, appealing to more health-conscious consumers, with a premium vegetable-based offer. Clive’s also manufactures all of its pies at its plant in Devon, which offered VFC its first production facility and caused retailers to take further notice.

“Our offering became increasingly diversified and we had a growing ability to innovative across several product types and appeal to a wide range of customers,”​ said Sparrow.

To reflect its growing size, the Vegan Food Group​ was announced in January 2024​​, a move that Sparrow said helped clarify its structure and acts as a holding company which now houses all businesses and brands together.

“We wanted to be seen as a group made up of various brands that are all focused on producing plant-based centre-plate meal options across multiple formats,”​ he added.

The moves did not stop there though, with the newly created Vegan Food Group acquiring German manufacturer TofuTown in February 2024.​​ The opportunity came about after TofuTown’s founders contacted Sparrow and expressed their desire to retire after 40 years in the industry.

“TofuTown is a great business as it has two sites in Germany that span 500,000 square feet in size, while trading across chilled, frozen, ambient and ready-to-eat,” ​he said.

“Our approach to growing the business has been consistent throughout. Europe is our strategic priority in terms of future acquisitions and we are focused in on centre-plate meal options. We don’t want to cannibalise what we can already produce, but instead focus on complementary businesses whether that be due to manufacturing capabilities, scale, geography or product type. We are looking at four different acquisition opportunities right now, but will stick to our core mission and not straying into areas which don’t fit our strategic outlook.”​

Changing the food system

After a busy four years since its foundation, the business currently sits in as good a position as any producer in the plant-based space to drive the category forward once again after a period of consolidation and correction.

“The category had become too confusing for consumers with so many brands and varying levels of quality and price points,”​ Sparrow explained.

“Thankfully, the sector has evolved and as the Vegan Food Group, we have the influence to shape the future through the delivery of clearer fixtures and products.”​

While reducing confusion will help grow the category, Sparrow also believes that ensuring price parity with meat, further enhancing product quality and encouraging innovation is of critical importance.

“If we can achieve these things, we will see category growth sparked again and kick start the transition of our food system towards a plant-based model,” ​he added.

While Sparrow was not a passionate vegan when he started on this journey, he is now intent on helping to create fundamental change to people’s diets through the Vegan Food Group and its range of brands.

“It takes years and years for consumer habits to change, so this transition will not be easy,” ​he continued.

“We want to educate people along the way and encourage the switch from animal-based diets over time.”​

In terms of defining the group’s overall mission, Sparrow and his fellow founders are clear about their ambitions: “It would be great to say that everyone adopts a vegan diet, but we know that won’t happen overnight.​

“Looking at the change we can make during our lifetimes, ending intensive factory farming is an achievable goal. Modern agriculture is a broken system and we want to fix that.”​

In other news, UK beer manufacturer Greene King is investing £40m into the development of a “state-of-the-art” brewery in Bury St Edmunds, Suffolk.​​