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Today, more than 10% of the people in the world are experiencing hunger, while a third of the food produced goes to waste. At the same time, the global population is projected to grow by another 2 billion and reach close to 10 billion by 2050. All this is happening in the face of exacerbating climate changes and limited arable land. We have become sensitive about sustainability, yet evidently, our food system is far from perfect.
Navigating alternative frontiers
One way to address the current issues is exploring novel approaches in food production. Innovations such as a wide range of alternative proteins and fats, lab-grown meat, are being developed through various biotech and microbial processes. However, the mass adoption of these alternative foods and ingredients faces a major hurdle – cost. For example, insect tech and vertical farming, once hyped, have fallen out of favor with investors due to high initial capital expenditure and an unremarkable cost-to-output ratio. We believe the winners will be those who manage to bring these innovations affordably to the wide audience.
Turning waste into a valuable resource
A more immediate trend that we believe is gaining momentum, is the effort to reduce global waste, particularly food waste. Actually, the understanding of the term is evolving – oftentimes waste is becoming an asset and an input for new products. We are seeing a growing trend of conscious consumer push coupled with stricter regulatory changes implemented by progressive governments worldwide.
An illustrative example is Cupffee, one of our portfolio companies. They are replacing the plastic-covered paper cups with a first-in-the-world edible biscuit cup that can safely hold hot and cold drinks. Up until now, it was difficult for governments to ban plastics in single-use cups due to the lack of alternatives. However, such bans are now taking effect in Western Europe, Canada, Australia.
Optimizing the farm-to-fork chain
Going broader, there are many points for improvement along the farm-to-fork value chain, leveraging technologies such as precision farming, bio inputs, or B2B marketplaces.
In the case of Ondo, they automate and optimize the operation of greenhouses and open fields through the better use of water, fertilizer, and other inputs. In the case of Pollenity and their “adopt a hive” program, they help beekeepers sell their honey at a fair price directly to people in the city.
Cross-sector collaborations and food as medicine
We also like to see companies that are at the cross section of agrifood and some of our other focus verticals. For example, Almacena is a B2B marketplace connecting coffee producers in Africa and Latin America with Western clients. One of the key aspects of the value proposition is the fintech layer on top of the platform, which provides financing of the transactions.
We also see more projects that touch upon nutrition and healthcare, looking at food as medicine. A most notable manifestation of this trend is the health insurance system in the US, now starting to allocate billions of dollars to cover the purchase of healthy foods as part of a patient’s treatment. In this respect, we believe there is great potential for sustainable production of functional and personalized foods. And as far as distribution goes, we continue to be bullish on consumers’ appetite for grocery delivery with our investments in Ebag, and more recently Paket.
Another trend that we will be keeping an eye on, is the growing pet care market. As we get more conscious about what we eat, we are also becoming mindful about the foods we buy for our furry friends.
Joining our #Oneof11 family means
At Eleven, we help our founders to reach and improve on their product-market fit faster. We have built programs and resources that aid companies in augmenting their value proposition with technologies such as fintech and AI. We facilitate synergies among our growing community of founders and partners through various formats such as matching events, knowledge-sharing workshops, and offsite retreats. We learn, take feedback and adapt, just like the entrepreneurs do, on our shared path to building a great business.
We are truly excited about food and our common, greener future. Because of the inevitable physical element, building a tech business in food takes more time and is more challenging than other fields, but we get inspired by those that are up to the challenge. Especially if it helps us all, one step at a time, to become more sustainable in what we do.
