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Daily news and analysis about the food tech revolution

Incubator

SKS 2019: Why Big Food is Betting So Heavily on Startup Accelerators

So you’re a new food startup who wants to level up and get some funding and mentorship. Or you’re a big CPG company who wants to uncover the latest food trends and acquire companies already tapping into them.

The answer for both quandaries might be food accelerators or incubators. Key word: might.

At SKS 2019, we dove into the wide world of food accelerators: what are they, which types of food companies should consider them, and why they’re suddenly all the rage. Weighing in on this conversation from the stage were Natalie Shmulik, CEO of The Hatchery; Tessa Price, Program Manager of WeWork Food Labs; and Peter Bodenheimer, Partner & Managing Director of Food-X.

If you’re contemplating applying for an accelerator program or just curious what they actually entail, you should watch the whole video of the panel below. Here are a couple of standout points made by our speakers to spark your interest:

What do food accelerators look for?
All of the panelists agreed that when searching for candidates for their programs, fit is critical. Shmulik emphasized the importance of a good founder presence. Price said that companies have to align with WeWork’s values and offer some technology that can accelerate WeWork’s ecosystem. For Bodenheimer, though, one of the biggest factors is persistence. “When the sh*t gets tough, will they stick with it?” he asked.

Why are food accelerators so hot right now?
You may have noticed that food accelerators seem to be popping up left and right lately. According to Bodenheimer, this is at least partially because of Big Food companies. He explained that large food and beverage companies typically only allocate 1-2 percent of their budget to R&D, so they turn to accelerators as a way to access more innovative products. Sometimes this can be productive, but other times it can be muddy, especially if the Big Food company doesn’t have a clear objective for their program.

So, what are the newest food trends?
Of course I wasn’t going to let these industry experts off the stage without asking them about the innovative new trends they were seeing bubbling up at their respective accelerator/incubator programs. Shmulik noted that more and more companies were looking to make eating an experience, not just a task. Price spoke about personalized nutrition and on-demand ordering, and Bodenheimer said he’d seen a lot of companies tapping into food as medicine, plant-based offerings and CBD.

If you want to hear the rest of the panelist’s up-and-coming dining trends to watch, or learn more about food accelerators in general, watch the full video below.

SKS 2019: Building a Food Accelerator

The Hatchery is an All-in-One Incubator for Chicago’s Food Entrepreneurs

Say you want to start a company to start selling your granola, vegan burgers or world-famous kombucha. How do you make the leap into a bona-fide business?

It’s definitely not easy. Budding food companies have to find an industrial kitchen space, funding, co-packing facilities and distribution partners. It can be really, really expensive.

That’s where The Hatchery, the Chicago-based food business incubator comes into play. “Company owners would normally have to spend 80-100K to build out their own kitchen,” Natalie Shmulik, CEO of The Hatchery, told me as I toured the facilities this week — a huge financial risk when you don’t even know if your product is going to be successful. With The Hatchery, however, nascent food entrepreneurs can rent out kitchen space, coolers, storage space, and other necessary pieces to run their own business, without investing a massive amount of capital up-front.

The Hatchery was founded three years ago when ICNC, a small business incubator, suddenly started receiving a massive influx in applications from food and beverage companies. It didn’t have a suitable kitchen space for these startups so it teamed up with Accion, which provides small business loans, to create a non-profit that would foster food businesses and provide them with a startup space and the potential for investment.

In addition to physical space, members also get free access to The Hatchery’s series of events on topics like restaurant technology, accounting, and branding. The public can attend the events for a fee. Hatchery members also get connections to some of the incubator’s partners, including large food corporations like Mondelez, Kellogg, and others. For example, ingredient provider Ingredion has a permanent chef on-site to help entrepreneurs figure out how to make their products shelf-stable, etc.

The majority of The Hatchery’s entrepreneurs work in the CPG space, but the incubator also has companies in food tech and catering (both Tovala and Farmer’s Fridge are members). According to Shmulik, a few top trends they are currently seeing are ghost kitchens, healthy snack food, plant-forward foods, and even CBD products. (Though CBD food and drink is technically illegal, Shmulk told me that the state of Illinois had approved it for food use.)

Pricing varies, but Shmulik gave me a number of $2400 per month for an entrepreneur, which covers storage, coworking space, kitchen use and member coaching. The incubator currently has about 200 members and 20 businesses operating out of its space.

Lately food business incubators have become quite en vogue. Notable players besides The Hatchery are the Chobani Incubator program, D.C.’s Union Kitchen, and The Kitchen in Israel. However, The Hatchery is different in that it doesn’t take any equity, offer any funding, or limit membership to any sort of timeline. In that way they’re almost more akin to straight-up shared industrial kitchen spaces, like Boston’s Commonwealth Kitchen or Pilotworks, which offered commercial kitchen space for budding food entrepreneurs.

Of course, Pilotworks ended up having to shut down after failing to raise enough capital to continue. This doesn’t seem as much of a risk for The Hatchery, as it’s backed by companies with pretty deep pockets.

That’s a relief for aspiring food entrepreneurs in Chicago. Shmulik told me that there are only two shared kitchen spaces in the city, so it can be very difficult for entrepreneurs to secure a spot. As demand for local food rises and more entrepreneurs step up to fill that need, all-inclusive food incubators like The Hatchery will become even more of a hot commodity.

Natalie Shmulik will be speaking about the food tech startup ecosystem at SKS 2019 this October! Early Bird tickets are on sale now. 

Givaudan Partners with Israeli Food Tech Incubator The Kitchen

Flavor and fragrance company Givaudan just announced a new partnership with The Kitchen, an Israeli food tech incubator.

Founded by the Strauss Group, the largest food & bev manufacturer in Israel, The Kitchen is a hub for emerging startups (many from Israel) looking to reinvent different parts of the food system. The program’s 12 current participants from cell-based meat company Aleph Farms to personalized recipe service MyFavorEats to food safety detector Inspecto.

According to an Givaudan announcement, The Kitchen’s partnership with Switzerland-based Givaudan will enable the latter to “expand its innovation ecosystem further by connecting with Israel-based food entrepreneurs who are contributing to the creation of healthier and sustainable products and solutions.” As details in the announcement were pretty scant, we’re still waiting to find out exactly what that means. We’ve reached out to Givaudan and will update this post if we hear back.

But it’s not too difficult to guess what the flavor and fragrance company will be getting out of the partnership: a direct line into the cutting-edge Israeli food tech ecosystem and a source for potential new company acquisitions. Working with an incubator like The Kitchen is also a great way for Givaudan to refresh their brand image as a company that’s hip with what’s new and not stuck in the past.

In fact, Givaudan has been slowly amassing partnerships with food tech innovation hubs around the world. In addition to The Kitchen, the company also works with Bits x Bites in China and EIT Food in Europe. Last December, Givaudan teamed up with Danone, Mars, and Ingredion to launch MISTA, a platform to help businesses solve problems in the food system, in San Francisco. And earlier this month, the company co-founded the Future Food Initiative, a joint venture with Swiss universities, Nestlé and food production company Bühler to encourage nutrition research in its native Switzerland.

Lately we’ve seen quite a few Big Food companies partnering with/creating their own accelerators to tap into emerging food trends. It seems like Givaudan is really taking the whole invest-in-innovation thing to heart — and I’m betting the company has more incubator partnerships in the pipeline.

IKEA’s Next Bootcamp Could Be Ideal for Grocery Startups Looking to Grow

IKEA is currently taking applications for the second iteration of its startup program, IKEA Bootcamp, which it holds in partnership with global entrepreneur community Rainmaking.

The Bootcamp works with companies tackling current issues around improving quality of life, whether that’s through sustainability, or making goods more affordable and accessible. While it’s not exclusively geared towards food businesses, startups in that area had a significant presence at the 2017 program. Participants included an Israeli startup Flying Spark, who’s created a protein source from fruit fly larvae, and goodbag, who makes smart shopping bags.

For the 2019 program, IKEA is looking for growth-stage companies and will run “a pilot-focused program,” according to a press announcement. Additionally, the company has increased the total number of companies who’ll participate to twenty.

This program will also add retail as a focus area, with participation from IKEA franchisee Ingka Group. (The IKEA Range & Supply business unit will also be involved for companies looking at product and supply chain development.)

With the application pool still open, there’s no word yet on what kinds of food businesses will be involved this year. But the new retail component suggests the possibility of a grocery-focused startup participating. That opens things up immensely: startups working on anything from more efficient ways of delivering food to smarter shopping to sustainable packaging could now theoretically join the Bootcamp.

IKEA isn’t specific about what kinds of food businesses should apply, so long as they’re ones that are trying to tackle significant global issues. Or as IKEA Bootcamp manager Per Krokstäde noted in the statement, “this is not a powerpoint exercise, this is about solving real problems in a way we can act on.”

The year may be winding down, but there are several other startup accelerators and incubators still taking applications for their next cohorts. Food-X, one of the biggest names in the world of food accelerators, is currently taking applications for its Spring 2019 program. FS6’s next cohort starts in February 2019, so those vying for a spot in that specific timeframe should apply soon. Techstars’ agtech-focused Farm to Fork Accelerator, meanwhile, will open its application pool on January 7, 2019.

The IKEA program will take place over three months, from March through June. It will be semi-remote, with startups spending some time in IKEA’s homebase: Älmhult, Sweden.

Applications are open until December 31, 2018.

In the Future, Shared Kitchens Will Function Like Community Centers

At the Smart Kitchen Summit (SKS), we love to highlight people who are forging new paths in the food world. But for those who are trying to jumpstart their own CPG food business, or scale up production, finding affordable commercial kitchen space can stop their idea in its tracks.

Ashley Colpaart is trying to lower that barrier to entry with The Food Corridor; a platform which connects budding food entrepreneurs with commercial production space. She’ll be speaking about how her startup is harnessing technology to disrupt the specialty food industry at SKS this October in Seattle.

To get you excited, we asked Colpaart a few questions about how she envisions the future of new food businesses, which CPG trends are on the rise, and why she considers her company “the Mindbody of food.” Read the full Q&A below.

This interview has been edited for clarity and content.

Q: How is the Food Corridor unique compared to other shared kitchen startups?

A: The Food Corridor is a tech-enabled platform that lets shared kitchens across the country operate more efficiently and grow more food businesses. Without owning any physical space, The Food Corridor is powering 80+ shared kitchen facilities across the US and Canada. Our network of co-cooking spaces is providing 4000+ chefs, caterers, food trucks, craft food producers, and delivery-only concepts a space to legally produce food and grow their dream business.

Q: You recently launched the app The Kitchen Door — what exactly does it do?

A: At The Food Corridor, our mission is to enable efficiency, growth and innovation in local food. Since our launch, we’ve done this through our kitchen management software that helps kitchen managers better operate all the moving parts of a shared commercial kitchen. This month, we are excited to launch our newest app: The Kitchen Door.

On a daily basis, food businesses contact us searching for a clean, friendly, and stable place to launch and grow their businesses. In response to this demand, our team has built the most comprehensive database of trusted commercial kitchens who have space available to rent.

The Kitchen Door is the go-to place for food entrepreneurs to search and contact an exclusive kitchen space to produce their goods.

Q: You’ve likened The Food Corridor to MindBody — the cloud-based management software for wellness classes — but for shared kitchen space. Why do you make that comparison?

A: Liking The Food Corridor to Mindbody actually led us to secure one of our favorite angel investors. In the early 2000’s his wife encouraged him to invest in a small software company that was helping yoga studios manage and book its yogis. It provides cloud-based business management software for the wellness services industry.

Similarly, The Food Corridor is a cloud-based business management software for the food industry. Our software handles tasks unique to a shared kitchen like hourly bookings, equipment rentals, compliance management, monthly plans, invoicing, and bill payment. The removal of these tasks, which used to be manual, frees up our kitchen owners to focus on increasing their number of renters, incubating clients and providing innovative services and programs.

Q: How do you see the cottage food industry space evolving over the next 5 to 10 years?

A: This may ruffle some people’s feathers, but I’m of the belief that the home kitchen is not equipped for growing a food business, specifically when it comes to scalability and consistency. The commercial kitchen, which is subject to safety standards pertaining to food and energy usage, is an important part of maintaining public health. That said, the cottage industry plays an important role for hobbyists following their passion for food and for budding food entrepreneurs testing recipes and getting direct feedback from consumers.

Like the rise in co-working spaces, I predict a rise in “co-cooking”  community-based commercial kitchen spaces. Paying a monthly membership fee to access a commercial kitchen that covers cleaning, water, waste, electricity and equipment repairs definitely takes a lot of stress out of the mix for food producers. With the rise in automation and the total cost of production of professionally-made food, the domestic kitchen may be becoming obsolete. I see co-cooking, community, and shared-use kitchens as the meeting places, gyms, and yoga studios of the future.

Q: What’s one of the most unique/bizarre foods you’ve seen made in one of The Food Corridor’s shared kitchen spaces?

A: Well, we are based in Colorado, so we see our share of marijuana or CBD inspired products — we are at a pretty high elevation after all. Pet foods seems to be super popular (you first-world dogs, you!) and of course, the sustainable and insect protein companies seem to also be making a go at it. I tend to get excited about the “delivery only” and “pop-up restaurant” concepts that we see taking hold.

Oh, and we do collect a list of creative food company names that we share across our team. Our favorites include: Fast and Curryous, Pride Enjoy, Subtle Tea, For Goodness Cakes, and Bruce Tea (to name a few)! There is not a lack of creativity in the food industry. That’s why we like it here.

Thanks, Ashley! If you want to see her speak more about the future of the cottage food industry and commercial kitchens, make sure to get your tickets to the Smart Kitchen Summit in Seattle on October 8-9th.

Food Tech News Roundup: Ben & Jerry’s, Food Waste Snacks, and Target Takeovers

It may have been a short week (at least for some of us), but it still feels good to reach the weekend finish line. Let’s celebrate with some food tech news, shall we?

We’re still riding a high from the announcement of the FoodTech 25: twenty five companies we think are changing the way we grow, source, cook, eat, and think about food. But lots of other food innovation news popped up around the web as well! Here are a few of our favorite stories, from Ben & Jerry’s new sustainability initiative to BYO homebrewing packs.

Chobani incubator to focus on food tech
Lately, quite a few CPG brands have been launching food-related incubators — including Greek yogurt darling Chobani. This week Chobani announced new incubator program which will revolve around our favorite subject: foodtech. The Food Tech Residency will be the company’s fourth incubator initiative, and will run parallel to their original incubator class. They’re currently searching for startups involved in agtech, food safety, innovative packaging, and other areas to improve the food system. Once selected, participating companies will have access to all Chobani Incubator programming, including factory visits, mentorship, opportunities to pilot new products, and a chance to pitch for funding. They have three spots open, so if you’re an emerging food tech or agtech startup, get on it!

 

Tyson Foods rolls out snacks made of food waste
Poultry giant Tyson Foods has created a snack brand which makes “Protein Crisps” out of food waste such as chicken breast trim, spent grain from beer brewing, and excess vegetable purée from juicing. Dubbed “¡Yappah!,” the brand will be used as an umbrella under which Tyson will release other sustainable food products. Each individual 1.25-oz serving has 8+ grams of protein and is packaged in a recyclable aluminum can. The crisps launched on IndieGoGo on May 31st, and are available to back now with a projected ship date of July 2018. Clean meat, food delivery startups, and now food waste snacks? Tyson Foods continues to work to be on the cutting-edge of all emerging food innovation trends.

PicoBrew now offers DIY PicoPaks
Countertop homebrewing startup PicoBrew rolled out DIY PicoPaks this week via Kickstarter, an option that lets Pico users load up their own ingredients to make beer and fusion drinks. The new bring-your-own ingredients option – which will work with the new Pico U as well as the existing Pico Cs and Pico Pros – provides an option for those in the Pico community who have wanted brewing flexibility beyond want preconfigured PicoPaks allow. The reward bundle includes containers for both beer brewing and PicoPak minis to create “fusion drinks” at home such as kombucha or goldenmilk. Post-Kickstarter, it will be interesting to see if PicoBrew offers brewers a variety of DIY container bundles depending on their preferences and brewing frequency.

Three new Targets to open up in Seattle area in 2019 & 2020
Target will add three smaller, grocery-sized stores in the Seattle area over the next two years, according to the Seattle Times. These are in addition to their original urban format store, which opened in Seattle in 2012. Their new stores are designed to fit into dense cityscapes and will stock products tailored to the surrounding neighborhood. This, as well as their recent expansion into same-day delivery, smart home-powered replenishment service, and acquisition of Shipt, is another way that Target is trying to keep up with the shifting grocery game and fight against Amazon.

 

Photo: Ben & Jerry’s.

Ben & Jerry’s works to offset their ice cream’s carbon footprint
Customers at Ben & Jerry’s scoop shop in London’s Soho neighborhood now have an opportunity to counterbalance the carbon footprint of their waffle cone of Cherry Garcia or Chocolate Chip Cookie Dough. For each purchase, Ben & Jerry’s will pay a penny to offset the carbon used to raise the cows, produce the ice cream, and ship it to the shop. Customers then have the option to donate a cent of their own and double the impact.

According to Forbes, the ice cream company is partnering with a not-for-profit who is helping them use blockchain to divide carbon credits — which are typically quite large — into smaller transactions which can link up to each ice cream purchase. They’re even developing an app to help customers keep track of their person carbon offsets.

 

Photo: Anova

Anova finally opens new Anova Kitchen
We’ve been monitoring the retail ambitions of sous vide specialist Anova closely, so we were intrigued to learn this past week that the company will finally open the Anova Kitchen for a sneak peek on June 6th. A company spokesperson told The Spoon that the new space will be used for events and will have some public-facing retail space, but that we shouldn’t expect the Anova Kitchen to be open to the public every day.  This contrasts with Brava, who plan to open a full time retail space early this summer.  Either way, we’re intrigued to check out the Anova’s new retail/event space. If you are too, make sure to RSVP for next week’s event and report back to us!

Did we miss anything? Tweet us @TheSpoonTech to let us know the best food tech news of the week!

Vertical Integration Takes Commonwealth Kitchen’s Incubator to New Heights

Food incubators, coworking spaces for food-related businesses, are nothing new. From Harlem-based Hot Bread Kitchen to the self-proclaimed “food innovation accelerator” Food-X to the (relatively) newly-minted Pilotworks backed by the team behind Blue Hill Stone Barns, the sharing economy has had its foot in the kitchen door for a while—and there are a lot of options for burgeoning food businesses to choose from.

However, in the heart of Boston’s Promise Neighborhood, the nonprofit Commonwealth Kitchen (CWK) is trying to revolutionize the food incubator template by bringing vertical integration into the mix. They still provide a shared kitchen, access to education, and a lower barrier to starting a food company to their 50+ business members, but they don’t stop there. Instead, CWK takes a holistic approach to their incubator business plan, providing their members with resources to overcome the nitty-gritty challenges of food production.

“We saw that our companies needed way more support with things like permits, licenses, food health testing, and insurance,” said Jen Faigel, executive director of CWK, in an interview with the Spoon. And so they hired experienced staff to provide their members with industry-specific support in everything from R&D to FDA registration to listeria testing.“We’re trying to give people a realistic opportunity to build a viable company,” she added. “Our focus is on hardcore scalability.”

To achieve this goal, CWK puts heavy emphasis on efficiency. They invested in a few larger, multi-purpose machines for their kitchen that could produce multiple goods; ones that could, say, make the dough for Quicksilver Baking Co.’s savory rugelach and mix up a batch of fillings for Yang’s Delicious Dumplings. They also aggregated the various part-time workers to form a full-time staff trained in the production of a slew of their members’ products. This somewhat radical step enabled CWK to offer a competitive wage and benefits to its employees, offsetting this cost with increased efficiency in production. This shift also frees up the business owners to spend their time marketing and selling their product.

With this framework in place, they decided to open up their small-batch manufacturing operation for hire, allowing everyone from local farmers and restaurants to outsource their production. “I hadn’t heard of any other incubator doing this kind of manufacturing,” said Faigel. “Probably because it’s unbelievably difficult and complicated to do.” 

But they didn’t stop there. Since their establishment in 2009, CWK has been out to bridge the gaps in the marketplace across all sectors of the food system. So far, this also includes tapping into the ripe institutional markets in Boston, namely universities. “Students often want healthy, transparent, local, authentic foods, and big brands aren’t paying attention to that desire,” said Faigel. But CWK is. Currently, Harvard University stocks salsa fresca from their member business Nola’s Fresh Food, and they produce and package applesauce (made from surplus apples from local farms) for the Boston Children’s Hospital.

In fact, making use of farmers’ surplus has become a key part of CWK’s sales; they’ll take crops that would be thrown in the compost, turn them into a value-added product, then sell them back, either to the farmer or in another market. Surplus tomatoes become tomato sauce peddled at a farm stand, excess pumpkin becomes pumpkin soup for a university dining hall. CWK is looking to shrink their margins wherever possible, and they’re thinking outside the box to make it happen.

This is not to say that CWK has perfected their method, or that their brand of vertical integration is without its challenges. “All of the changeovers are really tricky to manage,” said Faigel. “We have a good theory, but in practice, it’s very hard to execute.” Investing in machines to make multiple foods and putting in place resources and protocols for managing food safety, quality control, and marketing has also been an enormous hurdle. And with 140 employees to coordinate (18 of which work directly for CWK), logistics can quickly become a nightmare. 

For now, though, CWK is expanding—and not just within the realm of edible goods. For example, Suvie, a smart oven which just blew past its Kickstarter goal, is one of its member businesses. “Suvie knew all about the tech side of what they wanted, but needed help early on figuring out permitting on the food side,” said Faigel. “We also assisted with beta testing for packaging, scale issues, and R&D.” She told me that Suvie is the first equipment business that has come their way, but CWK is certainly open to welcoming more kitchen gadget start-ups and food-related tech enterprises in the future.

In fact, Faigel is confident that the CWK model will soon spread. “The integration of services, small-batch manufacturing, lower inventory, and more on-demand production is the way the food industry is going,” she told the Spoon. “We’ve worked hard to figure out a model, which we think is enormously replicable.” That means that this sort of vertically-integrated food incubator model may soon be making its way to your city.

Bringing Connected Kitchen Products to Market With GE’s FirstBuild

It used to take years for GE to bring a new product to market. With FirstBuild, their innovation community/incubator/maker space, they’re compressing the development cycle to months. FirstBuild is helping GE conceptualize and productize for new ideas in the kitchen and beyond, and it’s also helping them enter test market viability through new mechanisms such as crowdfunding.

In this podcast, Mike talks with Taylor Dawson, the lead evangelist for FirstBuild.

You can find out more about FirstBuild at www.firstbuild.com