Fund Me! Implications of the Emerging Ecosystem for US Food Startups

In the US, the food industry is facing unprecedented change as a result of the proliferation of small and emerging brands on a mission to disrupt and steal market share from established players. An important development has been the emerging ecosystem of new platforms such as food accelerators and crowdfunding websites that aim to be the missing ingredient in helping these startup companies achieve success.

picture of food start-up ecosystem

Report Summary

This new network—which is already drawing an influx of new investors, including venture capitalists and established food companies—has five broad implications for the food industry:

1. A great filter

These platforms help reduce the risks of investment for the growing number of food companies investing in emerging brands, as well as providing essential early insights into new trends.

2. Solving the innovation dilemma

Larger, more established food players are increasingly recognising their inability to nurture innovation and are turning to external R&D options.

3. A new division of labour

The development of these new platforms, as well as new venture funds, is changing the relationship between smaller and large companies.

4. Lower entry barriers

These new platforms are valuable as part of the continuum of solutions helping to level the playing field.

5. The time is ripe to invest

We believe corporations need to increasingly recognise venture capital structures at the Series A level as a core part of a broad-based strategy in order to continue to grow, innovate and stay relevant with consumers.

Infographic

infographic on the US food startup ecosystem