A seemingly insatiable appetite for food startups
This article has been adapted from GreenBiz's newsletter, VERGE Weekly, running Wednesdays. Sign up here.
Tyson Foods is at it again.
Last week, the giant animal protein company’s venture arm disclosed an early-stage investment (although it didn’t disclose the amount) in San Francisco-based New Wave Foods, which produces plant-based shellfish.
New Wave’s first product, a shrimp substitute, is made from sustainably sourced seaweed and other plant proteins. The company hasn’t announced its Series A funding yet but expects to do so "in the near future," and the product itself is due on the market in early 2020.
This represents Tyson Ventures’ fourth publicly disclosed investment in an alternative protein company. It also has put money into Mycotechnology (mushroom-based ingredients), and cell-based meat producers Memphis Meats and Future Meat Technologies. Meanwhile, the company’s sustainability chief Justin Whitmore is preparing the launch of Tyson’s own alternative protein brand, Raised & Rooted, in 5,000 retail stores by the end of this month.
The financial incentive for Tyson to do this is very clear: the market for plant-based ingredients could grow to $13 trillion by 2025. That’s one healthy appetite.
Indeed, I feel somewhat elated when I consider the frenzy of entrepreneurship focused on addressing systemic issues within the food and agricultural sector. According to figures from AgFunder, agtech venture investments mushroomed more than 40 percent in 2018 to $17 billion across 1,422 deals. The biggest hunger for these sorts of startups comes from the United States and China.
The menu of options for sating that appetite is expansive — ranging from alternative protein companies such as the ones that have caught Tyson’s interest to the ones that are offering samples of their wares at events such as the recent Hacking Food conference in San Francisco.
I’m particularly intrigued by the ones addressing one of the biggest systemic issues the world faces, food waste, so it was with interest that I read the news about a new accelerator ReFED is running for food recovery ventures — those specifically focused on supporting nonprofits.
The first cohort for the Nonprofit Food Recovery Accelerator, backed with resources from the Walmart Foundation and +Acumen, includes 10 U.S. organizations (selected from more than 125 applicants). They each get $30,000: one "winner" will receive $100,000 more at the end of the three-month program.
As you might expect, most are from big cities, from coast-to-coast, but one of them represents an Arizona town near Tucson with roughly 20,000 citizens. Here’s a quick scan of the chosen, listed alphabetically:
- 412 Food Rescue in Pittsburgh, which uses an app to coordinate the distribution of unsold food from retailers to hunger organizations who feed people in need
- Boston Area Gleaners, focused on facilitating donations of surplus commodity crops direct from the farm to food banks
- Brighter Bites, a Houston-based nonprofit that specializes in fresh, seasonal produce
- Community Food Bank of Southern Arizona, which is working on technology to help move more than 100 million pounds of donated local produce from Nogales (a major port of entry) to food banks around the United States
- Eat Greater Des Moines in Iowa, which uses refrigerated vans and routing software for food rescue and delivery
- Philabundance, a Philadelphia-based food bank that delivers to 90,000 people every week
- Plentiful, a technology firm in New York that has created a reservation system for food pantries
- Replate in Berkeley, California, which is working on an app for coordinating on-demand pickups and deliveries of surplus food
- Rescuing Leftover Cuisine, which provides rescue services and consulting resources to organizations seeking to reduce their own food waste in 16 U.S. cities, including New York
- Seeds That Feed, a nonprofit in Fayetteville, Arkansas, that arranges for direct-to-door produce and "healthy" food donations to home-bound and at-risk individuals
Cross-sector ideas for curbing food waste will be on the menu during one of three invite-only Summit events at the VERGE 19 conference in Oakland, California, from Oct. 22 to 24. The early bird savings rate expires Sept. 27. Don’t miss out.