Something is changing in the food and beverage industry
It’s no secret that multinationals have dominated the industrial food system for years now, but the landscape is changing, and changing fast. In the past five years alone, the top 25 food and beverage companies have lost $18 billion in market share, giving way to young companies and quick growing startups. Campbell’s Soup CEO Denise Morrison estimates that over $8 billion in VC funding has gone to over 400 start-ups since 2010. At the same time, a report from US based Rosenheim Advisors shows that the UK was among the top drivers in investment and acquisition activity in the food and technology sector.
The Food + Drink Investment Landscape
Despite all indications that there is market demand for innovation in the food and drink world, it’s still not easy to get a great idea off the ground. That is why food entrepreneurs are heading to crowdfunding sites to get started. According to NESTA, in 2015 food and drink was among the top three most crowdfunded categories in the UK, taking up a fair share of the £245 million in financing through equity-based crowdfunding for seed, start-up and early-stage financing. Despite the overall growth, food and drink start-ups are still struggling to reach funding goals through crowdfunding. According to Kickstarter, one of the leading reward-based crowdfunding platforms in the US, 75% of food projects don’t reach their fundraising goals. There’s space for growth in the F&B crowdfooding sphere.
Says Mike Lee, former Innovation Manager for Accell Foods, “The future of food belongs to entrepreneurs…Crowdfooding is a platform that’s lowering barriers by making smart connections to the funding and expertise needed for ambitious F&B startups to succeed. The food system thrives when there’s a diversity of good, new ideas in the ecosystem and Crowdfooding is a way to ensure that diversity will flourish.”
Crowdfooding does it differently
Crowdfooding wants to make successful crowdfunding more streamlined, accessible and attractive for the bright minds behind food and beverage innovation. Crowdfooding offers a one-stop shop for food entrepreneurs to raise funds throughout the development of their ventures. As both a reward and equity-based crowdfunding platform, we aim to make it easy for companies to tap into a targeted network of supporters and investors specifically interested in advancing food-related businesses, not just at the early stages.
A flexible and focused platform, Crowdfooding is well aware that there are strong incentives in the UK for individual investors to invest in start-ups, but we have realised that food entrepreneurs need a lot more than just capital to grow their business. While money is great, knowledge is powerful. That’s why we make sure companies understand the dynamics of crowdfunding and come fully prepared before engaging. We support our companies throughout the development of their campaign and help them deploy plans to make crowdfunding successful by offering a bespoke service to prepare, build and roll-out their campaign. On top of this, before kicking off a campaign we require companies to run a “pre-campaign” whereby they gather interest from prospective backers to validate whether crowdfunding is a suitable option for them without risking the launch of an unprepared campaign. Like the investors attracted to our platform, we want to work with young companies to get them support, financial and know-how, to fully take advantage of crowdfunding.
But we don’t stop there. For each equity crowdfunding opportunity, Crowdfooding is enlisting an external Investment Committee specialised in venture capital financing, business analysis, technology, consumer packaged goods and nutrition. Through this, Crowdfooding aims to bridge the knowledge gap surrounding the food and drink investment process for both financiers and entrepreneurs.
We believe food is inherently community-based, gathering people around the table to enjoy the success of a bountiful harvest and well-prepared meal. Crowdfooding wants to take that community aspect from the table to the investment realm and open up a space that will help young F&B innovators thrive. This is our community, join us now on crowdfooding.co.uk!