There has been a massive influx of investment into food start-ups in recent years. In 2017, global ag-tech and food-tech investment reached US$10.1bn across 924 deals, according to data from Rabobank partner AgFunder. This represents a 29% year-over-year increase in funding volume.
“Funding into the food innovation space continues to grow globally,” Meijers, who is Rabobank’s senior associate platform manager of banking for food start-up innovation.
And it isn’t just about cash. Ecosystems, accelerators, incubators, pitching competitions and the like have also multiplied.
“Five to ten years ago, events and communities like FoodBytes! were few and far between. Today, there are pitch competitions, accelerator and incubators cropping up globally. These initiatives play a large role in the proliferation of the food innovation ecosystem,” Meijers said.
These ecosystems help support a thriving food innovation environment. FoodBytes London! is Rabobank’s thirteenth global event in three-and-a-half years and, Meijers believes, the start-up applicants are continually raising the bar. “The ingenuity of start-ups that apply and selected to pitch at FoodBytes! continues to improve,” she observed.
Bringing together corporates and start-ups
A key ambition for Rabobank is to help bring together start-ups with the group’s corporate partners.
Meijers acknowledged that, in the past, the perception was that corporates were interested in investing in start-ups as a way to ‘outsource innovation’ and tap into new trends with relatively low risk.
However, she insisted that this view is evolving: “We’re definitely starting to see a shift in this dynamic, and FoodBytes! and similar platforms are helping drive it. In the past, start-ups were reluctant to collaborate with corporates because of this ‘innovation outsourcing’ concept. However, trust between the two parties is generally improving.”
In part, Rabobank is able to help build trust through its mentor day, which is held ahead of the pitching contest itself. Over the course of the day, start-ups involved in the competition recieve expert advice from industry leaders on various topics, from fundraising, PR and branding to consumer trends and route-to-market strategy.
“Through FoodBytes!, Rabobank is enabling our corporate partners to give more value than they take, helping them build trust with emerging entrepreneurs. Corporates have the resources, supply chain knowledge and capacity to scale, and start-ups have the game-changing ideas and nimbleness. Rabobank believes that by strategically bringing the two together, we can help drive food innovation forward on a global scale,” Meijers explained.
For example, she continued, Archer Daniels Midland Company (ADM) has been a “major partner” of FoodBytes! since 2016. “This partnership has helped ADM to connect with more trailblazers and innovators in the early stages of development or launch. These connections have evolved into food and drink development partnerships, mentoring, scale-up support and in some cases supply-chain partnerships.”
What are investors looking for?
According to Meijers, while investors are looking for different things, some common themes emerge. “In speaking with our partners the most common threads are a truly disruptive and unique product, demonstrated traction, a passionate, well-rounded team and, increasingly, a focus on social impact and sustainability,” she revealed.
FoodBytes! has an impressive track record of selecting start-ups that can stay the course to participate, with 96% of those selected to pitch still active or acquired.
“We attribute this rate of success to our application criteria and scoring process [that] has grown increasingly more robust; we evaluate start-ups based on innovation, team, traction, scalability and many other aspects.
“First and foremost, we’re looking for start-ups that are positively impacting the triple bottom-line, whether they are an ag-tech start-up focused on farmer livelihood, or a protein bar helping improve childhood nutrition in the developing world.”
Start-ups have an important role in developing solutions to some of the big picture questions facing the food industry, Meijers believes. In this context, the FoodBytes! series is part of Rabobank’s Banking for Food strategy, which wants to help feed the world more sustainable by 2050.
“Rabobank believes that sustainability and innovation are critical in promoting a thriving industry that will feed the increasing global population,” Meijers said. “The areas we’re most focused on are nutrition, earth, waste and stability.”
Variety and innovation on display in London
According to Meijers, the London event has attracted the most ag-tech start-ups to date, with food-tech and ag-tech applications making up the majority – 56% - of the applicant pool. This, she said, reflects the rapid development of sustainable policy and practice in Europe, which she described as “advancing quickly”.
“Precision agriculture is the dominant theme amongst the London pitch companies, including AI-powered dairy farming and data-driven beekeeping. Packaging innovation and novel food waste applications will also take the stage, with a flat wine bottle made from recycled PET and crisps made from up-cycled salmon skin. Supply chain transparency is another central trend, including light-emitting hardware that reduces seafood bycatch and the first portable food safety DNA detection kit.”
Rabobank’s next FoodBytes! event, taking place in New York next month, is focused on “slightly different” sustainable themes. “Animal health and reducing antibiotic use will dominate, including an AI milk quality analysis tool and microalgae-based oral vaccines for the aquaculture industry. Restaurant efficiency is another major trend, with a food assembly robot and a back-of-house tool that reduces food waste by fifty percent. Additionally, novel plant-based CPG start-ups will continue to trend, with tomato-based “sushi” and cereal made from up-cycled juice pulp.”
FoodNavigator will bring you further coverage of this afternoon’s start-up pitches, so check back for more on some of the most exciting innovations coming out of the European food sector.