Alternative Investing Report - March 24, 2025

*as of 3/23; Sources: S&P, BTC, FTSE, DJRE, CL50

As certain food staples, such as coffee, chocolate, and eggs, become more expensive, startups that are working on alternatives have been attracting VC attention. Companies such as Voyage Foods, Planet A Foods, and Food Brewer are developing coffee and chocolate alternatives, a sector that has raised more than $300 million, much of it in the last year. Alternative-egg startups such as Perfect Day, Eat Just, and The Every Co. have collectively raised more than $1.5 billion. Overall, the foodtech sector saw $10.6 billion in funding last year, a 9.6% increase over the year before.

➨ TAKEAWAY: While funding for foodtech startups has risen, the number of deals decreased by 30% in 2024, indicating that VC firms are targeting later-stage companies with bigger rounds. Factors such as inflation and climate change are affecting the prices of all sorts of products, and the market for chocolate, coffee, and eggs are massive, so a startup that can capture even a small percentage of that would be very successful.

In the newest episode of Smart Humans, Vincent founder Slava Rubin talks with Neutral CEO and co-founder Nate Helbach about the current macroeconomic environment, and developing luxury housing focusing on sustainability, health, and wellness.

President Trump’s 25% tariffs on Mexico and Canada could increase the construction costs for commercial real estate projects by 3% - 5%, which could cause developers to delay or cancel projects. Decreased consumer spending, lower economic growth and increased inflation would affect retail properties significantly, as well as industrial properties such as warehouses and distribution centers that are reliant on e-commerce. Markets near the northern and southern border would likely see the biggest effects as they tend to be more reliant on Canada and Mexico, respectively.

➨ TAKEAWAY: Contractors and subcontractors have already started raising prices as much as 20% due to the tariffs, which will affect construction costs in all real estate sectors, not just commercial. It’s estimated that the cost to build a new house will rise by as much as $10,000, which in turn, will raise prices, which could lower demand. Investors should monitor the situation, as it is unclear how long the tariffs will last and how exactly they will affect the market.

🤖 Perplexity raise: The AI search engine startup is reportedly in talks to raise a $1 billion round at a $18 billion valuation, double its valuation from December and 18x its $1 billion valuation from a year ago.

🥃 Bourbon record: A bottle of 2007 Old Rip Van Winkle “Van Winkle Selection” (also known as Pappy Van Winkle) sold for $125,000, well above the estimate of $30,000 - $50,000, setting a new all-time record for a bottle of modern American whiskey.

🏡 Increased inventory: New homes for sale grew for the tenth straight week and are up by 10.4% year-over-year, as overall active listings are up 28.5% year-over-year.

🏌️‍♂️ Golf course property: While demand for homes on golf courses has been surging, so too has investment in golf courses themselves, as the popularity of the sport grows and more people are joining country clubs.

🚀 Klarna partners with DoorDash: The Swedish fintech startup with an IPO on the way struck a deal with food delivery company DoorDash to offer buy-now pay-later options to their customers.

🪙 Haun Ventures’ $1 billion crypto fund: The VC firm is raising $1 billion to deploy into early and late stage crypto companies, and expects the round to be oversubscribed.

Tuesday: S&P Case-Shiller home price index and FHFA house price index released; Consumer confidence report released; New home sales report released.

Wednesday: Propstore’s Entertainment Memorabilia auction with 1,300 lots of movie and TV memorabilia, including two Star Wars props with high estimates exceeding $500,000 each; Sotheby’s is auctioning a 1984 Michael Jordan jersey that could sell for as much as $10 million.

Thursday: Major League Baseball’s Opening Day; GDP report released.

Friday: Personal Consumption Expenditures (PCE) and Core PCE indices, the Fed’s preferred inflation metrics, will be released; Christie’s Hong Kong 20th/21st Century Evening Sale, featuring a Basquiat estimated to sell for $12 million - $15 million.

Saturday: Sotheby’s Hong Kong Modern & Contemporary Evening Auction.