Enterprise capital funding into meals tech globally has elevated 40 instances within the final ten years, reaching a brand new excessive of £26.9 billion in 2021, in line with figures compiled by innovation charity Nesta. Nevertheless it additionally notes a pointy drop off in VC funding in 2022, with enterprise funding for meals tech start-ups falling by greater than 50% in comparison with 2021. This ties with the State of Enterprise report launched in January by CB Insights, which found the worldwide enterprise ecosystem skilled a pointy pullback in 2022, with funding dropping by 35% from 2021.
An enormous potential loser can be peoples’ well being, in line with Nesta. For instance, meals tech financing has been dominated by one class. Meals supply and logistics have attracted round 60% of enterprise capital funding in 2017-2021, equating to round £11.2 billion per 12 months on common.
This development is “regarding”, as takeaway and grocery supply app platforms are “the almost certainly applied sciences to extend weight problems”, it complained. As an alternative it demanded that new expertise, processes, and concepts should “be directed in the direction of offering extra wholesome meals choices if we’re to scale back weight problems and enhance the nation’s well being”.
However the scenario, in a sure ironic twist, does open innovation alternatives. For instance, patent purposes associated to lowering calorie content material have elevated by 165% within the final decade, outperforming international patent development, Nesta revealed.
Much more notably, it estimated that innovation in meals patents that enhance satiety has grown by about 580%. This considerably outperforms the worldwide pattern of roughly 70% development in patent purposes between 2010 and 2020.
Complementing this patent innovation, its evaluation additionally discovered encouraging indicators relating to the movement of funding into start-ups utilizing meals science to create new substances and reformulated merchandise for more healthy meals. These start-ups vary from these specialising in synthetic sweeteners or merchandise enhanced with dietary fibre to software program platforms enabling numerous sorts of meals reformulation. Funding within the space has elevated nearly 25 instances between 2017 and 2021.
Personalised diet enterprise capital funding has additionally grown 552% to succeed in £500 million in 2021.
Nonetheless, estimates of the general yearly funding quantities – £70 million – are small compared to most different sorts of meals innovation, indicating that that is nonetheless an emergent pattern in enterprise funding.
Nesta’s report subsequently included suggestions together with giving meals producers tax aid and enterprise price reductions will incentivise and allow improvements that make meals, and meals environments, more healthy. On the identical time, funding have to be made out there for analysis that explores shopper issues round such improvements, it added.
2022: the 12 months of open innovation
Nesta’s report got here as Eatable Adventures, one of many world’s main accelerators, referred to as on huge firms to embrace open innovation – the place firms collaborate externally to seize innovation alternatives in comparison with their present enterprise mannequin — to resolve the challenges of in the present day’s meals sector.
Its survey of 43 medium and enormous firms, discovered that greater than 90% intend to collaborate with exterior firms on innovation within the subsequent three years.
“There’s a rising certainty that open innovation, by means of collaborative networks, could symbolize a viable method to fostering enterprise, buyer satisfaction and trade sustainability within the quick and medium time period,” its report stated. “Because the meals sector faces monumental pressures and buyers demand more healthy, extra useful, and extra sustainably produced merchandise, this sector presents a really beneficial setting for the event of those invaluable partnerships.
José Luis Cabañero, CEO and founder at Eatable Adventures, advised FoodNavigator the agrifood worth chain is presently uncovered “to a big variety of challenges, from a rising inhabitants to feed with a decrease carbon footprint, international warming and climate instability affecting crop yields, the necessity to scale back the water footprint in farming, methane and CO2 emissions and at last the geopolitical conflicts that injury fundamental provides”.
All these points, he advised us, must be conquered with superior biotech and digital enterprise fashions. “The agrifood section is simply beginning to incorporate rising applied sciences into the tip to finish worth chain as a way to obtain these objectives,” he stated. “As we transfer ahead this property class will change into extra secure and attain new heights. Subsequently, meals tech represents an excellent funding alternative in the way forward for what is probably going the biggest trade on earth.”
