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2020 Year in Review: The Food Company of 2050

Harini Venkataraman, Ph.D., Analyst
February 9, 2021

Major food and beverage players are facing constant pressure to successfully navigate the rapidly evolving food industry, in line with changing consumer preferences. On top of that, smaller and more agile brands continue to pose a threat, given their ability to better cater to consumers' personalized needs. 2020 was a challenging year for the food industry, as the global COVID-19 pandemic has amplified some of these existing challenges, adding urgency to the need for solutions.

First, consumers' altered consumption patterns, coupled with meat supply concerns, opened the door for plant proteins. Both bigger players and emerging companies capitalized on this opportunity, reflected by a string of developments related to plant proteins throughout 2020. Second, the fragile food supply chain provided the much-needed impetus for the growth of protection and preservation technologies, as players in the agrifood value chain looked to decrease food loss and waste. Food e-commerce and delivery continued to boom through 2020, but this is likely to fade post-COVID-19. In 2021, food and beverage companies need to carefully reevaluate their strategies in light of some of these COVID-19-related long-lasting impacts as they look to not just survive but also thrive.

Reflecting on 2020, we take a look back at some of the most important developments that occurred in the Food Company of 2050 storyline:

Plant proteins witnessed unprecedented growth, with other categories like mycoproteins gaining funding momentum-png

  • Beyond Meat signed a three-year pea protein supply partnership with French ingredient company Roquette as the latter looks to expand and strengthen its presence in other geographies. This event bolsters our prediction about the gradual dominance of second-generation proteins.

  • Impossible Foods raised a $200 million Series G round, bringing its total funding to $1.5 billion. Apart from expanding its retail footprint in the U.S., the company is also working on new products, including plant-based milk.

  • Nestlé announced that it would set up its first plant-based food facility in Asia as part of its $104 million China expansion plan. This move underscores the growing importance of China as a growth market for plant-based foods in Asia.

  • The Protein Brewery raised a $22 million Series A for its mycoprotein ingredient. The company will focus on R&D as well as scaling up production using this investment. A number of other startups, such as Mushlabs, Nature's Fynd, and Meati Foods, also raised funding in 2020, indicating growing interest in mycoproteins.

  • Apeel Sciences raised a whopping $250 million in funding for its glycerolipid-based edible food coatings. The company will use this investment to scale up the production of Apeel coatings for different types of fresh produce as it looks to expand to other geographies outside Europe and the U.S.

  • Mori, another startup in the edible food coatings space, raised a $12 million Series A round. Compared to Apeel, Mori claims to cater to a broad range of applications, from whole produce to cut produce, meat, and seafood. Edible coatings received renewed interest in 2020, given their ability to extend shelf life and reduce food waste.

  • Afresh raised $12 million for its AI-based food waste prevention technology. Its machine learning algorithms aim to improve inventory management of fresh foods on retail shelves. Deployment of digital tools to mitigate food waste is gaining momentum in the retail and distribution sectors.

  • PepsiCo launched SodaStream Professional to bring beverages to offices, campuses, and travel hubs, allowing users to customize the flavors, carbonation levels, and temperatures of drinks. While this industrial internet of things (IoT) sparkling water maker may shape the beverage industry through personalization, the current pandemic may restrict its growth in away-from-home channels.

  • Nestlé announced that it would acquire Freshly, provider of fresh-prepared meal delivery services in the U.S, at a valuation of $950 million. Nestle will tap into Freshly's consumer analytics platform, aiding it in adapting to new industry structures, including food e-commerce.

  • Hoow Foods gained $1.8 million in additional funding for its food reformulation platform. Its "Re-Genesys" technology platform embodies the sentiment of ingredient informatics, looking to expedite the reformulation process in line with Asian consumer preferences.

  • Solarea Bio raised an $11.2 million Series A to develop a functional cocktail for the dietary management of the metabolic processes that cause musculoskeletal conditions. Food companies seeking to thrive in the future should look to act on opportunities within the realm of "food as medicine," which will become increasingly important.

  • Brightseed and Danone America formally announced a partnership to promote new health advantages in the latter's plant-based dairy portfolio, exploring health benefits from key plant ingredient sources, starting with soy.

  • Phynova raised €10 million in funding, led by DSM, for its mulberry leaf-derived ingredient "Reducose," which regulates blood glucose levels. This event is another data point for the growing interest in applying functional ingredients for health applications.

Additionally, the Lux Agrifood and Health team curated the following "Analysts' Choice" for further reading on the Food Company of 2050 theme:

  • "The Food Company of 2050" report uncovers the themes and technologies that will be most important to successful food companies in 2050. Our analysis of corporate concerns, startup trends, and social norms reveals six themes as critical to success in the coming decades.

  • Protection and preservation technologies are a significant part of optimizing profit margins in the food supply chain while also contributing to meaningful reductions in food loss and waste, especially in times of uncertainty. Our report "Preserving the Food Chain" analyzes major technology options and emerging solutions for preservation across the food supply chain, from pre-harvest to post-retail and in-home preservation.

  • Plant proteins will be a key near-term opportunity in the broader alternative protein space. The "Plant Proteins: Present and Future" report sheds light on how companies across the agrifood ecosystem should engage productively with plant proteins, both as competitive threats and as opportunities for new business growth through a regional lens.

  • Sugar reduction technologies will continue to be important for food and beverage companies to meet the healthier food demands of consumers. The "Key developments and opportunities in the sugar reduction space" blog outlines some of the notable efforts from developers as well as opportunities related to alternative sweeteners.

This blog is part of the Lux Agrifood and Health Team's Year in Review series examining the highlights and key developments of the energy industry in 2020. For an overview of the other storylines in Emerging Ecosystem of Agrifood and Health program, be sure to subscribe to our agrifood newsletter. 

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