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Summer recap: no break for FoodTech startups

We are back! Unfortunately, the sun has decided to snub Paris, so it looks like we have jumped into greyish autumn. But, there is a lot to do. Indeed, a lot happened in the summer. In itself, that is news. While I have been looking at FoodTech for the past decade and was used to quiet summers where startups didn’t announce anything meaningful. This time though, I am blown away by the number of large rounds of financing, M&A deals, new products announcements…

We already know that 2021 will be a record year for FoodTech but by how much? This has still be determined. From what I see and hear, I think it will be big, and we will remember 2020 and 2021 as the shifting years. I can’t wait to see what will happen next.

But before that, I have put together all you need to know about what has happened this summer. Here is the first half (the other part next week).

APEEL RAISES A NEW ROUND OF $250M

One year after its last $250M round, Apeel raises again $250M for its growth. Last year, this enabled the company to become the first packaging and anti foodwaste startup to become a unicorn (a startup valued at more than $1 billion – here is DigitalFoodLab’s 2021 FoodTech unicorn list).

Apeel is known for its edible peal (added with a spray) that slow oxidation on produce such as avocados. By avoiding up to 50% of the usual food waste, they can up their sales between 5 to 10%. It is also an answer to the use of plastics to packaging perishable produce.

DigitalFoodLab: We think Apeel is one of the most interesting startups to watch. It combines things we would like to see in more FoodTech startups: the use of deep technology to solve real-world problems (food waste, plastic use) in a very tangible way.

JOHN DEERE ACQUIRES BEAR FLAG ROBOTICS FOR $250M

Bear Flag is an autonomous tractor startup founded in 2017. So, being acquired by one of the world largest tractor companies for a quarter of a billion is not a bad achievement.

DigitalFoodLab: While there has been some excitement over the space of autonomous tractors in the past five years, few startups have delivered strong results. That may be related to the combination of the huge costs of manufacturing at scale these tractors, the need for large scale experiments to convince farmers and the shifting interest of investors from tractor robots to urban farms. If this acquisition goes well, this could be very positive for the entrepreneurs in this space.

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What we did:

  • Mapping of the AgTech ecosystem: startups, research regulators, and other leading companies.
  • Discussion to select areas to focus on.
  • Analysis of the information to reveal the trends and a model to analyse eventual partners.
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  • Scouting of relevant partners followed by introductions.

Results:

  • Mapping the different categories of innovations in AgTech that should be considered now to create long-term benefits for the business.
  • Identification of key partners (an incubator and a couple of startups).
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Use case: project for a CPG company on the healthy ageing ecosystem

What we did:

  • Education of the board through a couple of workshops to define the perimeter
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  • Deep dives on each of the priority categories.
  • Co-construction of a vision on how the company should address these challenges.
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Results:

  • Creating a consensus on which categories to prioritise and how to address them.
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Use case: project for a global CPG company to develop a strategy on the healthy ageing ecosystem

What we do (ongoing mission on a subscription model):

  • Kick-off where we present an overview of the AgriFoodTech ecosystem to select with the client the categories to cover and for each, the level of information required.
  • Monthly newsletter: each month we send a newsletter with the articles that we have gathered ranked by relevance, their summaries, and a layer of analysis.
  • Database: we set up a personalised database that will be filled month after month with the information gathered on the companies identified for the watch.
  • Workshops: twice a year with the client’s innovation team and other “innovation curious” team members, we present an overview of the evolutions, key trends and a dashboard of the topics followed by the watch.

Results:

  • A clear, regular and evolutive tool to follow what is happening in terms of innovation on key topics.
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Use case: opportunity screening for an ingredient company

What we did:

  • Kick-off to define the perimeter of the ecosystem studied.
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Results:

  • Shared view of the innovation ecosystem for the client with a view of the trends to prioritize.
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Use case: scouting for an agriculture coop

What we did:

  • Kick-off to define the perimeter of the client, the goals of the scouting (partnerships) and the criteria on which startups should be evaluated.
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Use case: working on an acquisition process for a CPG company

What we did:

  • Kick-off to define what the client is seeking, notably in terms of maturity.
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  • Identification of 20+ targets.
  • Workshop to select the most relevant to engage with.
  • DigitalFoodLab worked as a sparing partner during the acquisition process, notably to help design how the acquired startup could be integrated into the overall company’s strategy.

Results:

  • Different results from traditional M&A processes with a focus on the client’s innovation strategy.
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Use case: market due diligence on sugar alternatives

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  • Kick-off with the client to discuss its interest on this category, its expectations and existing level of information (notably on the target company).
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Results:

  • Clear view of the ecosystem and of the reasons to believe (or not) in each sub-category.
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