The third F&A Next is at Wageningen University on May 30 & 31. Food and agtech venture capitalist Niccolo Manzoni is speaking at this year’s event. On the eve of the conference, he shared his thoughts on the sector’s future.
Niccolo Manzoni is a co-founder of Five Seasons Ventures and is one of the first food tech venture investors in Europe. Previously, he created and managed a portfolio of food tech investments in high-profile companies such as Just, Impossible Foods and Memphis Meats. He established a proprietary network for food tech deal flow, due diligence and investment and he is a mentor to various accelerator programs.
What is the current status of food & agtech?
Niccolo Manzoni: “There’s never been a better time for food & agtech. There is incredible demand for better food at an affordable price, so start-ups are well placed to capitalize. Large corporations have also become extremely interested in food & agtech. Many of them find it difficult to deal with the disruption start-ups can cause, so they are looking at innovation happening outside their R&D facilities. As a result, there’s great deal flow at the moment. From a venture capital perspective, there are few sources of specialist capital, so it’s good to be in that space right now.
“Corporates now realize they need to look at start-ups earlier”- Niccolo Manzoni, Five Seasons Ventures
How is it developing compared with other sectors?
The jury is still out. The pace of innovation generally is on the rise and food & agtech is catching up, but it’s still a small part of the overall venture capital space. There’s definitely room for growth and acceleration. That’s starting now and things are likely to get even better in the coming years.
What do you see happening in the alternative proteins area? How are incumbent companies responding?
We’re focused on investments in Europe, which is a little behind Silicon Valley, so we’re yet to see the European equivalent of Impossible Foods or Beyond Meat. While there are companies over here innovating in this area, we’re yet to see them prove alternative proteins can work commercially. Maybe due to lack of capital? Conditions are right for them to emerge in the next two years, though we won’t see the same high levels of investment that Silicon Valley companies attracted.
Corporates are responding and there have been acquisitions. For example, Danone recently bought up an alternative dairy company. I think there’s a general realization among them that they need to look at these disruptive start-ups at an earlier stage because some estimates show that they are losing between 1 to 2% of market share in some segments to local, early stage, innovative companies every year. And you can see they’re already doing that –Heinz, Danone, Barilla, Diageo and many others have launched corporate venture capital funds to promote more innovation.
“We’ll definitely be discussing alternative proteins at F&A Next”- Niccolo Manzoni, Five Seasons Ventures
What are your aims for Five Seasons Ventures?
We have a broad remit in food & agtech, based around certain themes, one of which is alternative proteins. We’re aiming to invest in companies in that space and a number of others, including shifting diets, personalized nutrition and functional foods. There are other areas we’re interested in too, such as reducing food waste, traceability and agritech that allows farmers to do more with less.
Our challenge in the short-term is that we have been inundated with companies looking to raise capital. A nice problem to have. In the long-term, the opportunities for us are that we’re specialized, so we co-invest in the best companies to ensure they’re properly capitalized and have the right skills to scale and grow at the right pace.
Can you reveal what you will be addressing at F&A Next?
We’ll definitely be discussing alternative proteins from a scientific, investment and start-up perspective. But more than that, I can’t say at the moment.
What are your top three pieces of advice for food & agri companies?
First of all, seek ‘smart capital’, specialist capital that provides expertise, help and advice alongside investment. You also need a strong, focused vision on the problem you’re aiming to solve. And finally, fight to get the best talent out there. The current food & agri mega-mergers mean there’s a large pool of talent out there that’s invaluable for start-ups.
Robotics and corporate innovation are the central focus of F&A Next 2018, the event for innovation in the food and agri sector. F&A Next brings together large corporates wanting to innovate and start-ups that need financing, advice, and clients. There are just a few tickets left for F&ANext 2018 on May 30 and 31.