Venture Capitalists Aiming at Food Startups

Venture capitalist

From a necessity to a full-fledged and flourished industry, food sector has seen some great revolutions. There is no denying that it has grown to a large extent over a small period of time. Be it the new applications that are being launched or a new themed café, the options just keep on increasing. And this revolution now witnesses a new champion. Venture Capitalists (VCs) with their billions of dollars are now enthusiastically investing in agricultural and food ventures.  These investments are not just based on profit, VCs are now inclined towards startups that conserve resources, use less chemicals and accelerate distribution. Investors are interested in food startups that aim at improving people’s health and the health of this planet.

The food industry is relatively untapped, with huge amount of funds pouring in, it’s only going to bring in new ideas and vigor. The entrepreneurs interested in food startups not only include businessmen, but also people who have been associated with food in one or the other way, be it farmers, home cooks or tech companies. The first two quarters of 2015 saw a total investment of $2.06 billion in food startups. Entrepreneurs are finally cashing in the opportunity that the industry has to offer. Some of the big names in the VC circle have already invested in the food sector while others are continuously showing keen interest. This includes mainstay funds like Khosla Ventures, Andreessen Horrowitz and Kleiner Perkins Caufield & Byers. In fact, companies like Google, Mars, Monsanto and Taylor Farms are also making substantial corporate investments.

The food industry has also started relying on analytics to study patterns among consumers and know what exactly they are looking for. To draw conclusions from data and create useful reports, mountains of existing data on resources, geography, supplies, weather and market are combined together. Many of the apps in the market today use real time insights which farmers and food businesses utilize further to create efficiencies and reduce waste while establishing connectivity with their consumers.

Although, most of the food sector has seen a tentative and substantial growth, the response of agriculture sector has been late and slow. This is because farmers are more apprehensive when it comes to adopting new technologies, and venture capitalists are generally disappointed due to farmers’ unawareness and high expectations.

As the consumers are growing and becoming smarter than ever, companies that are not changing with the dynamic environment are losing money and facing downfall even when the industry as a whole is growing. Investors are looking for food which is not high on quality but certifies the general standards of organic food. All in all, investors are all ready, loaded with million dollar ideas and they only need the food industry to respond positively.

Apart from these, there are also platforms like Food + Tech Connect which help companies through their online classes, meetups, news and other resources. With the food business working closely with technology, and new food startups launching every day, one can only expect a vertical growth for this enriched industry.

 

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