Food Innovation Opportunities Attract Venture Capital
Fueled by consumer demand and the need to rethink food — how we make, market, and deliver it — food innovation opportunities attracted a boom in venture capital funding for 2012. Funding for the burgeoning food technology sector attracted a record $350 million in venture capital, up 37% over the prior year. These figures come from a report by CB Insights. In 2008 the figure was just $50 million.
Another sign of the hunger for food innovation is the robust growth of the specialty foods market. The Specialty Foods Association just reported record growth for this industry of innovative food products in 2012. Sales grew more than 14% to $86 billion, far outpacing the growth of traditional food categories.
The founder of one of these many start-ups, Josh Tetrick, explains the surge of interest by saying “the food industry is not only massive, but like the energy industry, it is terribly broken in terms of its impact on the environment, health, and animals.”
Says Samir Kaul, who has invested in a half dozen food start-ups, “I wouldn’t bet my money that Cargill or ConAgra are going to innovate here. I think it’s going to take start-ups to do that.” Addressing an obvious question, Saul also said, “It’s not Franken-food. We’re careful not to make it sound like a science experiment, but there is technology here.”
All this fluffy talk leaves us wondering, will we feel so warm and fuzzy about the start-ups when they grow up to be part of Big Food?
Click here to read more in the New York Times, click here to read the CB Insights report, and click here top read about the state of the specialty foods industry.
Dig on for Victory, image by Peter Fraser from The National Archives of the United Kingdom / Wikimedia
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