What are VCs looking for in the food, beverage arena?

Food and beverage startups are so integral to the CPG category that bigger companies are increasingly making investments in smaller firms. Within the past few months, Tyson Foods’ venture capital arm invested in alternative protein firm Future Meat Technologies and Kellogg’s venture unit, Eighteen94 Capital, invested in functional ingredient company MycoTechnology.

food startups

As consumers continue to seek healthy food and beverage options with transparent ingredients, entrepreneurs are answering the call by swiftly releasing new products. In fact, many analysts are saying that food-focused startups are on track to get more momentum this year.

Taste is king

Small food and beverage businesses that are seeking investments from venture capital firms often wonder what investors look for when they evaluate brands for potential funding. One thing that’s essential in a product is that the flavor is appealing, said Carole Buyers, co-founder and managing partner BIGR Ventures, a growth equity fund that provides capital and partnership to early-stage natural and organic products.

“Great taste is an absolute must,” Buyers said. “If a product does not taste great, no amount of capital or operational excellence will overcome that obstacle.” In addition, BIGR looks for companies with strong brand values.

Read more at SmartBrief:  http://www.smartbrief.com/original/2018/05/what-are-vcs-looking-food-beverage-arena