Do Good Foods, a Bedminster-based sustainable meat producer focused on cutting food waste, filed for Chapter 11 bankruptcy protection.

In a petition filed June 16 in the U.S. Bankruptcy Court for the District of Delaware, the two-year-old company described its decision as “an important step to put the business in a position to succeed and allow us to continue pursuing our goals.”

According to Do Good Foods, it has received a commitment for $30 million in new financing that’ll be used to support business operations while the bankruptcy process plays out. Additionally, the company said it will continue to “execute on contracts and expansion plans and operate as normal, picking up food waste from its partners, upcycling it and selling its products to its retailers and food service clients nationally.”

In its filing, Do Good Foods listed estimated assets and liabilities of as much as $500 million.

Founded in 2021 by Tewksbury natives and brothers Justin and Matthew Kamine, Do Good Foods collects unsold produce and proteins from grocery stores and then converts what can’t be donated to food pantries into a nutrient-dense, healthy dry feed for animals.

Through its closed-loop system, Do Good Foods partners directly with retailers, picking up excess products free of charge and contributing whatever they can to local organizations that feed the hungry. Everything else is delivered to Do Good Foods’ Fairless Hills, Pa., facility, where it is used to make a feed to raise carbon-reduced animals that ultimately get processed and sold as a sustainable alternative in the supermarket.

In April 2022, Do Food Foods launched its debut retail product: Do Good Chicken – the first United States Department of Agriculture-verified carbon-reduced chicken and the first verified chicken brand actively combating climate change.

Already sold at hundreds of stores across the U.S., Do Good Foods recently expanded its retail distribution with Inserra Supermarkets under the ShopRite banner in North Jersey, as well as with Morton Williams in New York City and select Acme locations.

Do Good Foods, which received $169 million in backing from global asset manager Nuveen, also has processing facilities under construction in Fort Wayne, Ind., and Selma, N.C.

Scaling sustainability

The brothers – whose father is Harold Kamine, the founder and chairman of Bedminster-based investment firm Kamine Development Corp. – told NJBIZ earlier this year that they were optimistic about what’s ahead, which included continued efforts to expand distribution and production in addition to venturing into new retail categories, such as carbon-reduced eggs.

At the time, the pair said they believe the “opportunity for impact” over the next five years “is incredibly exciting,” but admitted one of their biggest challenges was “simultaneously blending infrastructure development with the development of a consumer brand.”

“But while the infrastructure can’t happen without Do Good Chicken and Do Good Chicken can’t happen without the infrastructure, we’ve decided to stay laser-focused on driving awareness for Do Good Chicken so consumers understand the very real impact they can have simply by moving their arm 6 inches to the right and choosing our chicken at the grocery store,” they said.

Do Good Foods – which was named one of Fast Company’s most innovative brands of 2023 – estimated it has diverted at least 27 million pounds of food waste from landfills since its launch.

“The field of sustainability challenges the status-quo by nature – looking to create innovative and intelligent solutions that inherently change the way we do things,” the partners said. “Our advice to eco-friendly companies would be to just keep going, no matter how many times you’re faced with ‘no.’ Even after you recognize that there’s a better way to operate, you’ll face challenges and it may be an uphill climb at times. People will challenge your vision, but if you persevere and move forward with strength, you’ll eventually start to see the impact your company can make.”

In a July 12 statement to NJBIZ, Justin Kamine said, “We founded Do Good Foods to pursue a mission to bring sustainability to scale with the largest food companies and we are executing on our vision and mission. The court-supervised process we are undertaking is intended to strengthen our financial position.”

“As part of this process, we received a commitment for $30 million in new financing from certain of our existing lenders, demonstrating their belief in our mission and adequately supporting our operations, which continue to operate as usual. We look forward to aligning financially with partners that can help accelerate the execution of our mission as we seek to scale nationally. We are confident the steps we are taking today will enable us to bring our sustainable solution to even greater heights,” he stated.

The filing came about a week after AeroFarms, a Newark-headquartered vertical farming company that sells its leafy greens in chains like Whole Foods Market and Amazon Fresh, announced it is seeking bankruptcy protection, citing “significant industry and capital market headwinds.” During proceedings, the company said it will operate as usual, servicing its customer base and key selling partners.

AeroFarms also anticipates additional retailer expansions to move forward as planned.

In recent years, billions of dollars have been put into vertical farming ventures to help produce and distribute fresh food closer to urban markets. Since its 2004 launch, AeroFarms has raised a total of $238 million during 10 fundraising rounds, from investors including IKEA parent company Ingka Group, celebrity chef David Chang and retired U.S. Army General David Petraeus.

Now faced with a pullback in venture capital funding, the already costly venture of indoor vertical farming is starting to experience growing pains.

The industry’s challenges – which include high energy costs, technological limitations and the ability to scale production to keep expenses down – has made it tough for these companies to achieve true sustainability, both environmentally and financially.