Venture: Food Tech Companies Are Rising In Europe
Europe is known for its rich variety of cuisines along with its long list of award-winning restaurants. As people’s eating habits are changing with the increase of fast food establishments and on-the-go work schedules, European food tech companies are developing food technology that is aimed to adapt to the changing eating habits of the 21st century. One reason that these food companies are being established in Europe would be that people want to see the food system in Europe improve and the technology created by the companies can influence people to eat healthy and help them find food that is fresh and organic.
According to a report conducted by Five Seasons Ventures, the three countries that are contributing the most funds to developing and enhancing food technology in Europe are France, Germany and the United Kingdom, especially as 63 percent of European food tech investment in 2017 was made by German and U.K.-based startups. Five Seasons Ventures had also noted that other food tech startups from other European countries also invested their own fair share in food trends and technology such as Dutch food delivery service Picnic raising €100 million and Danish wine recommendation service/marketplace Vivino raising €56 million, as well as €6.5 billion ($7.5 billion) that had been invested by VC’s in the European food tech industry since 2013.
Five Seasons Ventures was founded in Paris by Ivan Farneti and Niccolò Manzon as a VC that targets food and agricultural technology and it already had the backing of European Investment Fund, Nestlé, Fondo Italiano d’Investimento and Bpifrance. The VC, with its purpose in developing products that promotes healthy foods, shorter supply chains, quantified and personalized nutrition, and alternative proteins, had announced the closing of its first early-stage fund of €60 million in regards to investing in food and agricultural technology throughout Europe.
A report published by DigitalFoodLab mentioned that by the end of 2018, €750 million ($860 million) will be invested in food technology in Europe although there are challenges for food tech startups to gain funding since investors are less likely to trust and invest in the startups until the startups have gained success. The cautious approach that is taken by the majority of European investors and VC’s aims to raise and invest money gradually since they do not want to see startups fail quickly, compared to the quick American approach to invest a lot of money in a startup and later see it fail.
Just like Five Seasons Ventures, DigitalFoodLab is a Paris-based food tech VC firm that was created by FoodTech entrepreneurs Matthieu Vincent, Jérémie Prouteau & Alexandre Grimault, to help its clients, corporates and investors to detect and act on opportunities in the food tech industry. DigitalFoodLab is the intelligence platform of FoodTech and its first events were held in 2013 when the three entrepreneurs who wanted to use the events as a platform to gather data on the local ecosystem and they have helped many entrepreneurs identify investors, partners and employees.
A rising number of food tech startups have raised and invested money in food technology and trends throughout Europe such as French startup Ekim raising €2.2 million ($2.5 million) for its pizza-making robots and Swedish startup Karma raising $12 million to develop an app that combats food waste by helping retailers sell excess food to consumers at super-reduced prices. German smart water appliance company Mitte, which recently won the Startup Showcase at Smart Kitchen Summit Europe, had also raised $10.6 million in a seed funding round with Danone Manifesto Ventures, VisVires New Protein Capital and Kärcher New Venture.
The Smart Kitchen Summit Europe event in Dublin was the first event hosted by Smart Kitchen Summit outside of North America and it contained discussions, conversations, and demonstrations about the products and current trends in the European food scene. The event showcased the future of food and kitchens established in various regions of Europe and emphasized on the development of appliances or products which can be preferred by people by being used properly when incorporating ingredients and creating food from their respective countries.
The European food tech ecosystem is estimated to invest in €640 million by the end of 2018 even though Europe’s share of global investments is between 13 and 17 percent and that the continent also boasts a 25 percent share of the global agricultural and agrifood market. European food tech startups and firms from Portugal to Slovenia can owe their continuing rise to the major trends that are occurring right now in the European food tech industry, especially with the creation of products such as 3D printed restaurants and smoothie-blending robots.
The investment in food and agricultural technology by the European food tech startups and firms show a dedication to preserving traditional cuisines and eating habits that are encountering changes influenced by a globalized economy and lifestyle that emphasize more on the quantity of food instead of increasing both quantity and quality of food altogether. The European food tech industry has the ability to influence eating habits of consumers in other countries outside of Europe and can pose a serious challenge to the Silicon Valley food tech industry’s position as the leader of food technology worldwide.