Follow the Money: What Recent Funding Tells Us About Pet Industry Innovation

In some industries, long-standing companies tend to serve as the arbiters of innovation. Think: electronics, pharmaceuticals, and even automobiles. While smaller, more agile disruptors commonly enter markets like these to innovate, the more enduring trends are often led by the Apples, Pfizers, and Volkswagens of the world. 

The pet industry, however, tells a different story. At SUPERZOO 2025, one of the largest pet industry trade shows in North America, first-time exhibitors made up 30% of the show floor. These are early-stage startups offering cutting-edge concepts that aim to address an unmet need for pets and pet owners.  

These emerging players can serve as an excellent litmus test for true innovation in a market rife with imitation, label candy, and marketing hype. Thus, those few entrepreneurs who can break into the market and receive the funding they need to compete at scale are often bellwethers for where the industry is headed in terms of new products, innovations, and addressing real-world issues for pets and their people. 

So far in 2025, several pet food and treat brands in the United States and abroad have announced successful funding rounds to accelerate various aspects of their businesses, including product development, operations, marketing, and distribution. These investments carry insight into the future of pet nutrition and care—from premium, wellness-focused brands to those championing the next wave of sustainable ventures. 

From the Ground Up 

A handful of brands have earmarked recent funding for the “bookends” of pet nutrition—product development (where it all begins) and distribution (how the product ultimately reaches pets’ bowls).  

One of the first pet food funding announcements of the year came from Healthybud, a Canadian pet wellness brand that secured $1.5 million to grow its portfolio of freeze-dried diets and functional treats for dogs in both the United States and Canada. It’s not a jaw-dropping amount, but still a solid Series A funding round for a functional pet treat company. Not long after, pet supplement brand Kradle announced its $4 million raise for similar reasons—expanding its product range and distribution. These two rounds are a signal—investors are latching on to premium positioning and rewarding wellness-focused brands with coveted capital. 

Recent funding patterns reveal another telling trend: the shift from brick-and-mortar pet retail to online shopping. While more established brands have long relied on distributors and retailers to grow their brands, younger startups are opting for more direct relationships with pet parents. 

Happy Howl is just one recent example. This direct-to-consumer (DTC) dog food company raised an undisclosed amount to support research and development and portfolio expansion, as well as optimizing its DTC and retail distribution models.  

On the other side of the Atlantic, human-grade cat food brand Untamed collected £10 million (roughly $13.4 million USD as of exchange rates on Sept. 3) to expand the global reach of its DTC subscription-based model. Meanwhile, HEY HOLY, a German breed-specific dog food brand, raised €5.7 million (roughly $6.7 million USD) to expand its team, build out its product portfolio, and optimize its online presence. 

Part of this shift toward DTC is due to pet owners’ demands for convenience, but it’s also about staying close to the consumer—gathering data, fostering relationships, and iterating based on real-time customer feedback. Additionally, subscription-based models have proven lucrative for many modern brands—not only in pet—and the promise of repeat, set-and-forget purchases are highly attractive for investors looking to recoup their spend. 

A More Sustainable Future 

Environmental sustainability is being pursued by pet nutrition companies of all shapes, sizes, and philosophies, and many of the cutting-edge innovations in this space are being brought forth by emerging players with novel ingredients. 

For example, Proteine Resources, a Polish biotech startup, recently raised €9.5 million (roughly $11 million USD) to construct a pilot facility for producing insect-based protein analogues for pet food. Another insect protein producer, Loopworm, secured $3.25 million to further the development of its technology and commercialization of its silkworm-based ingredients. Lastly, Finland-based Volare collected €26 million (roughly $29 million USD) to establish a large insect protein facility and further develop its technology. 

These investments highlight two things: first, a paradigm shift away from traditional sourcing practices and toward more sustainable systems; and second, an investment space driven by longer-term, supply-driven innovation. 

What the Money Reveals 

The American pet industry is projected to reach $157 billion in sales by the end of 2025, according to the American Pet Products Association (APPA), and if this year’s growth follows patterns from recent years, pet food and treats will make up most of those sales.  

There are several factors weighing into the pet food market’s continued success, but sales growth has ostensibly been buttressed by more premium products—often at more premium prices. But the growth isn't just about volume; it's also about value. Investors are consistently rewarding wellness-focused, channel-savvy brands that reflect fundamental shifts in how the market defines value. 

This activity comes amid a broader downturn in pet industry investment. According to data from Crunchbase, more than $500 million in investments were handed out to pet-related startups around the world in 2024, down 58% from the estimated $1.2 billion in global funding seen by pet industry startups in 2023. The COVID-era in pet industry investment and high-valuation acquisition activity has been replaced by a more selective landscape in which startups must demonstrate clear differentiation, solid revenue models, and both near- and long-term growth strategies in order to win funding. 

Follow the Science, Not Just the Trends 

In a perfect world, today’s selective investment environment would separate science-backed innovation from brands that are just following the trends. In reality, pet nutrition is complicated, sometimes operating in a black box that the average Joe doesn’t understand. This makes it critical for brands to not only follow trends and deeply understand their consumers, but to also advance science-backed solutions for pets and their people. 

For established brands, this creates both a challenge and an opportunity. Surface-level innovation simply won’t be enough to stand out in today’s saturated pet food landscape, but science-backed innovation could be your most dangerous differentiator.  

BSM Partners’ expert team is laser-focused on bringing validated pet food science to the forefront of this industry. Our proprietary projection model can help brands identify trends before they become obvious, and our Nutrition & Innovation team can supercharge product development while balancing consumer demand, sustainability goals, and what’s genuinely best for pet health and wellbeing.  

Ready to lead instead of follow? Get in touch to learn how we can help you identify and develop innovation that future-proofs your innovation pipeline. 

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About the Author

Jordan Tyler is the Director of Media at BSM Partners and co-host of the Barking Mad podcast. She has more than five years of experience reporting on trends, best practices and developments in the North American pet nutrition industry. Jordan resides in Bentonville, Arkansas, with her husband and their four furry family members.