One of Calista’s focus sectors is Food. This sector faces unfavourable prevailing challenges in the shortage of raw materials and the polluting effects of our production and consumption. Technology has played an essential role into addressing these issues.
This explains why the global FoodTech market reached c.€250Bn in 2020, with huge momentum existing among the food incumbents and especially the FoodTech companies. Their valuations are growing twice as fast as the others.
Since 2015, a total of €9Bn were invested in the FoodTech sector in Europe: the majority of investments occurred in the food delivery and innovative D2C models (with an emphasise in the Pet food sector). Investors could expect trade sale exit revenue multiple ranging from 2x-4x, with a bigger potential on the acquisitions made by tech companies.
In the pre and post COVID-19 world, consumers are increasingly becoming conscious about their diet and lifestyle, making them more health-centered than ever. As a result, consumers are now looking to purchase foods without added or harmful ingredients and ones that are less harmful for society and the environment. Meanwhile, malnutrition and unhealthy diets are shown to be important risk factors for non-communicable diseases. The demand for better foods is raising and the food industry has to re-invent itself in order to answer the growing demand. The food industry has to continue to address sustainability issues within the industry itself, land and water use, gas emission and food waste.
By investing in companies that have positive impact on the environment, and in companies that answer consumers shifting demand, we at PeakBridge are contributing to the disruption of the food system Our Eating Habits. Just to name one, our portfolio companies, Nick’s, is offering consumers better-for-you snacks to help people keep good health while still allowing them to enjoy sweets. In 2014, Niclas “Nick” Luthman, co-founder Nick’s, was diagnosed as a pre-diabetic, so he was forced to change his diet and lifestyle. He missed having sweets in his diet and so he invented the delicious healthy ice-creams and snacks that are sugar free and low calories. Nick’s became a world leader in sugar replacement, allowing consumers to enjoy sweets without compromising on health.
Our eating habits are also highly affected by the availability of some products; meat, for example, a luxury for most people through history, has made available and affordable now more than ever. Much contains with chemical additives to elongate shelf-life, enhance flavor or similar. The affordability of meat is a result of having a large proportion of the land on our plant given over to farms and pasture.
Technology is the clear answer for much of the current issues in the way we produce our food and our harmful eating habits. New proteins, such as seaweeds, are being adopted as a sustainable alternative to animal proteins. Yeasts are being adjusted to grow proteins that make alternative meat which resembles cow-based meat. Fermentation of plant proteins are being utilized to create new flavor solutions. AI and big data technologies are being applied to monitor and analyze consumer insights in the food sector. Innovation and technology are shaping new food habits; PeakBridge is supports the top ventures that will make the most impact on the future of our food and plant.
By PeakBridge and Calista
1. FoodtechInvest Report 2021, DealRoom and Hungry Ventures
2. State of European Foodtech 2021, Five Seasons Venture and Dealroom
