Ask many people how to find funding for emerging food projects, and lots of them will point to crowdsourcing sites. After all, sites such as Kickstarter have driven concepts ranging from PicoBrew to the Anova Precision Cooker to levels of funding that would put a smile on any startup founder’s face. Indeed, when it comes to gadgets and devices in the food arena, the widely known crowdsourcing sites can pay off, but other kinds of concepts are finding funding through alternative routes and alternative crowdsourcers.
Where can you turn if Kickstarter or GoFundMe don’t seem right for your project? If you have a food or beverage startup concept, consider PieShell. It’s based in New York, and was founded by entrepreneur Cheryl Clements. Check out some of the concepts that PieShell is funding here.
Part of PieShell’s concept is that crowdfunding has benefits that go beyond just money. “Crowdfunding ultimately brings you closer to your customers — something that’s crucial for startup success,” notes PieSheller Caroline Halter. “Branching out beyond friends and family helps you learn what your customers like about your product, as well as what they don’t like. For instance, one of our first PieShellers, Edamam, crowdfunded to build a nutrition app. The crowdfunding experience helped them realize that their real potential was in B2B (business-to-business), rather than consumer markets.”
According to Halter, another benefit to crowdfunding is that it can give you an instant hook for a pitch to the press. “Once you get a little bit of press, it’s much easier to get more,” she said.
Credibles is another avenue to look into for funding. It was started in San Francisco in 2014 by founder Arno Hesse. The twist that Credibles provides is a way for customers to financially support their favorite food businesses. The basic concept is that customers are investors. Customers can prepay a business by starting a tab with the business, and then they draw on the tab whenever they visit.
Credibles offers food and beverage businesses financial flexibility up front. Case in point: Driver’s Market is a small grocery store that focuses on transparent, non-GMO sourcing direct from as many local producers as possible. Through Credibles, Driver’s Market has already raised over $100,000 from its customers, with the first $10,000 arriving in 10 days. You can find out how to get your business or concept funded with Credibles here.
The angel investors who provide funding for technology-focused startups have their counterparts in the food and beverage arena. Food Angels is an organization that strictly invests in early stage food and food-tech startups. The group consists of accredited angel investors who screen companies each month and select a few to consider for funding. Food Angels invests in the form of equity, royalties and more.
There are also community organizations for food startups seeking funding. The Angel Food Network is an organization of emerging food and beverage companies seeking funding. Membership is by invitation and you can apply here. Some types of food and food tech concepts may also qualify for the IKEA Bootcamp accelerator program, which will reward startups trying to solve the world’s problems. Food tech concepts have the potential to qualify, and you can find out more here.
Finally, it’s worth noting that the world of food funding has its own dedicated conferences. Future Food-Tech is one that is typically held in North America and Europe, and the Food Investing Conference is another one to look into.
Getting a project funded can call for some creativity, but there are more options available to startups than ever before. Entrepreneurs who think outside the box will have the strongest chances to find funding.
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Hi Sam,
Great article! There is a need for a wider access to capital for food entrepreneurs
At Crowdfooding we’re all about helping startups raise finance through crowdfunding – check out
https://www.snapmunk.com/food-crowdfunding-crowdfooding-startup/
Happy to tell you more over the phone if you fancy – I’d love to be included in your great list
Cheers,
A