Foodtech

History

2024

The world's first artificial mouth has been created. Why it is needed

On October 15, 2024, specialists from the French National Institute for Agricultural Research (INRAE) and the Fujita Medical University in Japan announced the development of the world's first artificial mouth. The device will help to better understand the process of chewing food in order to develop food for people who have health problems - for example, due to age. Read more here

The world's first plant for the production of protein from the air has opened

At the end of April 2024, Solar Foods Stratap opened the world's first plant in Finland to produce nutrient-rich protein from the air. It is assumed that the proposed technology will help partially solve the problem of the food crisis. Read more here.

2023

European food tech startups overtake American in investment for the first time

At the end of 2023, European startups in the field of food tech and climate technologies attracted investments in the amount of approximately $2 billion. This is almost the same as in the record 2022, when investments were estimated at $2.1 billion. Relevant data is reflected in the review of Dealroom and FoodLabs, released on June 14, 2024.

The study says that in 2023, Europe for the first time overtook the United States in terms of venture financing for startups in the market under consideration. In particular, 58% of total investments came from European companies. For comparison, American startups attracted approximately 35% of the total funding. In 2022, the US share exceeded 55%, and Europe was a little over 20%.

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FoodLabs

In the European region, the first place in terms of venture capital financing in 2023 is occupied France with $416 million. However, compared to the previous year, the figure decreased by 29%. The second place went to, Switzerland in which investments jumped by 179%, reaching $354 million. Closes the top three Britain with $239 million and a 51% year-on-year reduction. The top 10 European states in terms of attracted funds also included (Netherlands $177 million), (Belgium $118 million), ($113 Norway million), ($107 Denmark million), ($98 Iceland million), ($95 million Germany) and ($76 million Spain). Moreover, all these countries showed positive dynamics on an annualized basis, while the maximum growth was recorded in Iceland - plus 8891% compared to 2022.

According to analysts at Dealroom, in 2024, the volume of investments due to the lack of mega-rounds will return to the level observed before the start of the COVID-19 pandemic. The indicator is expected to be at around $1.1 billion. For comparison, in 2019, about $814.2 million was invested in the market under consideration.^[1]

Halving global investment to $9.2 billion

At the end of 2023, global investments in food tech companies amounted to approximately $9.2 billion. For comparison, a year earlier this figure was estimated at about $22.5 billion. Thus, more than a double drop was recorded, as stated in the Pitchbook study, the results of which were published on March 15, 2024.

In 2023, 1,393 deals were concluded to finance food tech companies against 2,052 in 2022. Thus, the fall was recorded at around 32%. The negative dynamics is explained by several reasons: these are, in particular, macroeconomic problems and industry obstacles. In addition, venture capital investors have changed priorities.

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Unsplash

Annual inflation has pushed food prices to an all-time high for consumers. This poses a serious problem for innovative startups developing projects related to consumer goods, says PitchBook senior analyst Alex Frederick.

According to him, the slowdown is especially noticeable in individual sub-sectors of the foodtech market. In particular, the entire area of ​ ​ e-commerce, including the delivery of products from restaurants and through online platforms, in 2023 decreased by 67% in dollar terms compared to the previous year. And compared to the record 2021, the fall in this area was 87%. Investments in technology for restaurants and retail also showed a sharp decline: the fall is estimated at 71-72% compared to 2022 and 85% compared to 2021.

In general, against the background of the current market situation and high inflation rates, investors are increasingly focusing on those companies that have a clear strategy for entering profitable activities.^[2]

In Russia, the production of edible cups for coffee and water began

At the end of November 2023, it became known about the launch by Drin and IT of the production of edible biodegradable containers into which you can pour coffee, ordinary water, etc. According to the developers, 250 ml cups without deformation hermetically hold contents with a temperature of up to 80 degrees for 40 minutes. For yogurt, coffee, tea or hot chocolate, sweet cups are offered, for soups and salads - salty and garlic-flavored. Read more here.

In Russia, they began to produce cakes, cookies, flour, pasta and chocolates from crickets

In October 2023, it became known about the intentions of enterprises in the Moscow region and the Stavropol Territory to establish the production of food products from crickets. Read more here.

From CO2 began to produce food

In mid-January 2023, food tech startup Arkeon announced the start of using gas fermentation to turn CO2 into food. It is known that about a quarter of greenhouse gas emissions are created in the production of food. Read more here.

2022

3D printing of salmon for restaurants launched

In mid-October 2022, information appeared about the launch of 3D printing of salmon for restaurants. The Israeli startup Plantish, which carried out this project, hopes to change the food industry, in particular the way we eat fish. The company hopes the new technology, which is already being used to deliver products to restaurants, will help conserve fish populations. Read more here.

Magnit invests 1 billion rubles in the production of mycelium, which is needed for growing mushrooms

On September 19, 2022, Magnit announced the investment of 1 billion rubles in the production of mycelium, which is needed for growing mushrooms. The retailer is implementing a project on the basis of its own mushroom complex in the Krasnodar Territory. Read more here.

2021: Creation of a laboratory in the Russian Federation for the production of edible bacteria for 200 million rubles

On October 15, 2021, it became known about the creation of the first in the Russian laboratory for the production of edible bacteria and microorganisms. Investments in the project, which will be implemented in the Vologda region, are estimated at 200 million rubles, said Mikhail Charny, a leading expert of the FoodNet working group of the National Technological Initiative (NTI). Read more here.

2020: Global investment growth in food tech projects by 60%, to $16.33 billion - Fuel for Growth

The volume of investments in food tech projects on a global scale at the end of 2020 reached $16.33 billion, an increase of about 60% (or $6.1 billion) compared to 2019, when investments were measured at $10.17 billion. Such data are provided by the venture capital fund Fuel for Growth based on the results of its own market research.

According to statistics, in 2020, foodtech startups entered into a total of 695 deals with investors. This includes angel investments, seed rounds, investments issued in accelerators and incubators, and investments from early and late stage funds.

The growth is largely provided by the category of e-commerce platforms, which in a pandemic have received advantages that are difficult to overestimate. Nevertheless, among the leaders in the investments received there is a vegetable meat producer. This segment of innovative food products showed the largest relative growth in sales this year, and therefore attracted the most attention of investors, "said Andrey Zyuzin, Managing Partner of Fuel for Growth.

Fuel for Growth Data

The main areas of food tech projects are as follows:

• agricultural biotechnologies;
• new sources of protein and innovative foods (alternative/cell meat and fish, plant protein dairy products - only using new technologies, namely recreated from plant raw materials in laboratory conditions, insect protein - animal food, food, including functional);
• IT/IoT in Agriculture;
• intelligent and active packaging;
• personalized nutrition.

According to the report, investment in food tech is becoming more and more relevant among global venture capital investors. Thus, in 2020, the share of investments in this sector increased by 41% and amounted to 5.5% of the total amount of venture capital investments in the world. In 2019, this figure was 3.9%.

Most of the investment transactions in the food tech sector for 2020 fell on the United States (45%). Approximately 25% and 22% of funding rounds took place in Europe and Asia, respectively. About 8% of the deals were made in the Middle East, South America and Africa.

Fuel for Growth Data

The most popular areas of investment, according to the Fuel for Growth report, are projects related to the creation of e-commerce platforms (ordering food in restaurants, delivery) and the development of new food products (plant-based products - meat, cheese, fish, etc.).

The largest investment deal in the foodtech industry in 2020 involved the Indonesian company Gojek, which develops a mobile application to access services such as transport and logistics, ordering and delivering food, digital payments, purchases, news and entertainment, etc. 19 investors participated in the funding round, including Tencent Holdings, JD.com, Facebook, Alphabet, Visa, Mitsubishi and PayPal.

The top three in terms of investment also included the Chinese developer of the online platform for the delivery of products Xingsheng Selected (3 transactions totaling $1.8 billion) and the Indian online platform for the delivery of food from restaurants Zomato (4 transactions totaling $1.3 billion).

Also in 2020, a number of large IPOs were carried out in the foodtech sector. The food delivery platform DoorDash from the United States raised $3.37 billion during the IPO, and the Chinese platform Dada-JD Daojia - $1.49 billion.

The study also said e-commerce platforms have become the main driver of investment growth in food tech projects. However, among the leaders in attracted investments, one more group of projects can be distinguished - developers and manufacturers of plant alternatives to traditional products (meat, cheese, fish, etc.). For example, the US vegetable meat producer Impossible Foods raised $700 million in 2020.

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