When Food Meets Tech
In the Thanet Earth farm in Kent, a high-tech greenhouse the size of Heathrow’s Terminal 5, rows and rows of juicy tomatoes are taking shape on horizontal wires. A central computer optimises the heat, humidity, light and nutrients they need, allowing them to grow all year round — rather than just for seven months. There are plenty of examples of similarly high-tech food solutions, from bio-bean founder Arthur Kay turning coffee bean waste into biofuel to food-delivery company Farmdrop, which just raised £7m in a Series A round, connecting consumers to producers. But for the large part, when you look at what’s on your plate today, the technology underpinning it is probably not hugely complex. And that’s exactly what makes food as a sector so ripe for disruption. “The food industry is incredibly slow to take up technology: there are tonnes of inefficiencies and, therefore, opportunities to apply technology to it,” says Nadia El Hadery, food entrepreneur and founder of YFood, the organisation that aims to drive innovation in the food industry.
And there’s already been a wave of savvy startups that are spotting gaps in the market. “Unlike the app market, for example, the food sector isn’t saturated yet and it’s arguably easier to attract attention because there are fewer people are innovating,” says Julian Hearn, co-founder of Huel, the formula that promises to be nutritionally complete and comes in bar or shake form. In other words, it’s all to play for.
Driving Food Innovation
Supporting these startups is an evolving ecosystem that’s geared towards driving food innovation, from farm to fork. In 2016, the government launched the UK Food Innovation Network to help food producers and there are a number of food incubators and accelerators like Cinnamon Bridge, The Food Foundry and Kitchenette. YFood has been hosting monthly foodtech meetups for several years now and also organises London Food Tech Week, while the FoodTalk Awards was recently launched to recognise the sector’s most innovative ideas. As for investment, many startups have found success with crowdfunding initiatives and Crowdfooding, a crowdfunding platform for food and drink ventures, was launched in 2014. The big players are also looking to tap into the innovative potential of startups: VCs are warming to food tech startups while Just Eat and Waitrose have both launched foodtech accelerators aimed at spotting and nurturing talent.
So far, many of the most successful foodtech startups like CityMunch, a Just Eat accelerator alumnus that uses data to offer people restaurant discounts, and Winnow, which helps restaurants track how much food they’re wasting and raised $3.3m in a Series A round, don’t tend to tend to manufacture food. Instead, they’re using technology to make the way we eat more accessible or efficient. And it’s easy to see why: Britain doesn’t have that many food manufacturers willing or able to produce small-scale batches and the process of getting from idea to product can be prohibitively time-consuming. “It was hard getting off the ground: legislation can be a hindrance but really the biggest hurdle was convincing manufacturers to produce our product at scale,” says Hearn of Huel’s early days. “Even though Huel is a fairly simple product with only a handful of ingredients, it took nearly a year. Thankfully we had the funds but for a smaller startup with a bright idea, they’d probably run out of money long before that.”
Among the startups that are bold enough to manufacture a new food product from scratch, many are being spurred on by the challenges in our food supply chain. In the UK, we’re throwing away £13bn worth of food each year according to the Waste and Resources Action Programme — despite the fact that food prices are going up and many people are grappling with food insecurity. We all want to eat well but there are some serious concerns about how to achieve this as the global population swells. So serious is the situation that Eric Schmidt, executive director of Alphabet, Google’s parent company, believes that developing new plant-based protein sources is a more important tech trend than autonomous cars or virtual reality. As a result, several startups with a strong sustainability mission have emerged that are tackling food waste or focusing on alternative protein. “We started our business on the back of the fact that by 2050, there will be nine billion people on the planet to feed but major problems in the food production system,” says Neil Whippey, co-founder of Eat Grub, the startup that’s produced a high-protein energy bar out of insect powder. By packaging it up in a familiar format, it’s hoping people in the West will be more willing to accept insects as a snack.
An Opportunity for Collaboration
But the likes of Eat Grub and Huel are hardly high-tech examples, as their founders are quick to point out. Both Whippey and Hearn believe that there’s nothing revolutionary about turning food into powder or eating insects: they’re just using modern science and inventive techniques to combine ingredients in a way that’s appetising. In fact, Britain’s food is still pretty low-tech — though this could change. “The techies haven’t understood the opportunities of partnering up with the foodies yet,” says Alessio Dantino, co-founder of Forward Fooding. “Before we see companies totally re-imagining the way food is produced and making it big on a global scale, we need to get the techies excited about sorting out some of the biggest issues affecting our food system. They need to see the gaps that technology can fill.
Clearly there are opportunities for tech and food to collide more in the future but it’s still very early days for foodtech as a recognised sector. And this means investment so far has tended to come from crowdfunding campaigns. This is partly because many of the startups looking for support are consumer-facing: everyone eats and can get excited about a new food product — especially if it has eco credentials. But it’s also because VCs have been slow to consider food as a potential investment area. “There is no mature foodtech ecosystem yet, so there are not as many VCs specialising in it,” says Dantino. “That’s why entrepreneurs tend to look to crowdfunding when it comes to raising funds and validating their concept.”
Foodtech isn’t going to be flying under the radar of VCs for long, though. When El Hadery started organising meetups for the sector’s players around five years ago, she went knocking on the doors of investors but “it was so far off their radar it was unreal”. These days, they come to her and she speaks to two or three investors a day.
One VC who’s excited about foodtech’s potential is Christopher Persson, general partner at RECAPEX, the company that helps digital companies scale and funded Winnow. “As humans, billions of us eat several times a day and there’s an enormous amount of overproduction and wastage,” Persson says. “If a startup can use technology to produce more food more efficiently, there will be opportunities for investment around that.” However, he does acknowledge that many VCs have restrictions when it comes to building their portfolio and the type of company they can invest in. And given that foodtech is in its infancy when compared to the likes of fintech, it may fall outside their remit. What’s more, entrepreneurs may not be asking for enough to make it worthwhile for a VC. “There are many exciting ideas but they’re not always on the right scale,” Persson adds. “VCs are probably waiting for the really big ideas that require a large investment.”
Convincing the Public
But while high-tech food might be whetting the appetite of investors, will the general public be able to stomach it? According to a study by British Social Attitudes, 69% of people say it matters to them that their food hasn’t gone through a lot of processing. And whether it’s genetically modified beef or those Thanet Earth tomatoes, there’s a tendency among the media as well as consumers to label ingredients that have benefited from technology as ‘Frankenfood’. The horse meat scandal didn’t do much to boost trust in food producers either. For Huel’s Hearn, though, the public’s assertion that they wants to eat food in its natural state doesn’t necessarily correspond with what they’re buying. “The term foodtech might be off-putting for some people because they may assume that technology means it’s not natural,” he says. “But at the same time, people are still eating a lot of processed food: go into any supermarket and the fruit and veg section is usually one of the smaller ones. They’re largely eating processed crisps, sandwiches and chocolate bars.” So it may be that consumers are willing to accept processed food, as long as they can understand and trust it.
Thankfully, technology might just have thrown up a solution that could overcome these trust issues. Proponents of blockchain say it could reliably trace the history of ingredients using a decentralised ledger system that’s highly difficult to alter once an entry has been made. People will be able to see exactly who’s been involved in the production of their meals, from the farmer who planted the seed to the people who processed, stored and sold the end product. This is one of the areas that’s most exciting for YFood’s El Hadery. “Food-delivery entrepreneurs spotted a massive gap in the market years ago and that’s starting to happen in other areas,” she says. “Entrepreneurs are pushing the boundaries of what’s possible to make food more accessible and make the entire system more transparent. People are switched on about what they eat now and they want to know the journey their food’s taken before it’s reached their table.”
French lawyer, politician and gastronome Jean Anthelme Brillat-Savarin famously said “tell me what you eat, and I shall tell you what you are”. And judging by the innovation taking place throughout the food production system, it might not be long until what’s on our plate more accurately reflects the way we’re embracing technology in every other part of our lives.
