Let’s delve into a captivating topic that has transformed the landscape of the food industry: the changing structure of collaborations between food startups and established companies. As leaders in the food industry, you understand the importance of staying at the forefront of industry trends. So, Let’s explore how collaborations have evolved over the past decade with specific industry examples!
Shifting from traditional acquisitions to strategic partnerships: In the food and beverage industry we’ve witnessed a significant shift from acquisitions to strategic partnerships in recent years. Instead of absorbing startups, established companies are now seeking mutually beneficial partnerships that leverage each other’s strengths and drive innovation collectively.
Nestle, one of the largest F&B companies in the world, acquired Sweet Earth Foods, a plant-based food start up, in 2017. Sweet Earth Foods specializes in creating vegetarian and vegan products, including frozen meals, burritos, and burgers. Nestle’s acquisition of Sweet Earth Foods allowed them to expand their portfolio and tap into the growing demand for pant-based food options.
By partnering with a food startup like Sweet Earth Foods, Nestle was able to leverage the startup’s agility and innovative approach to product development, while also benefiting from their established brand and distribution channels. This collaboration helped both companies achieve their respective goals and capitalize on the shifting consumer preferences towards plant-based foods.
Embracing open innovation platforms: Open innovation has gained significant traction in the food industry. Companies are opening their doors
to external collaborations, actively seeking ideas and expertise from the startups and even individual entrepreneurs. This shift has fostered a culture of co-creation and knowledge-sharing, resulting in a rich pool of innovative ideas.
Kellogg’s, a multinational food manufacturing company, collaborated with Plug and Play, a global innovation platform, to launch an accelerator program focused on advancing food innovation. The Innovation Challenge aimed to identify and collaborate with start ups working on disruptive technologies and solutions in the food industry. The program provided selected startups with mentorship, funding, and access to resources and industry experts to accelerate their growth and bring their ideas to market.
Through this open innovation platform, Kellogg’s sought to explore innovative concepts in areas such as food production ingredient sourcing, packaging, and distribution. Plug and Play’s extensive network and expertise in connecting startups with corporate partners allowed Kellogg’s to access a diverse range of entrepreneurial talent and disruptive ideas. This enabled Kellogg’s to foster innovation within their organization and stay at the forefront of the rapidly evolving food industry.
Focus on agility and speed to market: Startups are known for their agility and ability to quickly bring new products ot market. Established companies recognize this advantage and have adapted their collaboration strategies accordingly. Collaborations now emphasize speed ot market, allowing startups to retain their nimbleness while leveraging the resources, distribution networks, and market presence of established companies.
In 2019 Walmart, the multinational retail corporation, collaborated with Zipline, a startup specializing in drone delivery services. Through this partnership, Walmart aimed to leverage Zipline’s drone technology to enhance it’s last mile delivery capabilities. Zipline’s drones are capable of delivering packages quickly and efficiently, particularly in hard-to-reach areas.
Walmart saw the potential of using drones to expedite the delivery of perishable goods, health and wellness products, and other items to customers.
By partnering with Zipline, Walmart aimed to improve it’s supply chain efficiency, reduce delivery times, and enhance customer satisfaction. The agility and speed of Zipline’s drone delivery system allowed Walmart to reach customers in remote locations or areas with traffic congestion more rapidly than traditional delivery methods.
Rise of incubators and accelerators: Over the past decade, we have witnessed the proliferation of food incubators and accelerators. These platforms provide startups with resources, mentorship, and networking opportunities, while established companies gain access to a pipeline of innovative ideas and potential partnership opportunities. The emergence of these incubators has revolutionized the startup-established company relationship.
The dairy industry has witnessed the rise of incubators and accelerators facilitating collaborations. For instance, Danone has launched the Danone Manifesto Ventures program, an incubator for startups specializing in alternative dairy products. This initiative recently expanded its plant based dairy alternative presence into ‘animal free’ dairy proteins via precision fermentation by taking a minority stake in ImaginDairy – using microbes instead of cows.
Danone’s support allows ImaginDairy to develop it’s innovative approach to alternative dairy, accelerating their time to market and scaling their impact. These collaborations highlight how food industry incubators and accelerators play a pivotal role in nurturing startups, facilitating knowledge exchange, and driving the development of novel and sustainable food solutions.
Integration of technology and data-driven decision-making: Technology integration is reshaping collaborations in the snack food industry. PepsiCo has
partnered with a number of different startups specializing in data analytics and machine learning for flavor profiling. Through partnerships and involvement in various accelerator programs like Techstars, PepsiCo gains access to innovative technologies and data-driven solutions.
By embracing these collaborations, PepsiCo aims to optimize it’s supply chain, improve operational efficiency, and enhance consumer engagement. For example, by working with startups focused on AI and machine learning, PepsiCo can analyze vast amounts of data to gain insights into consumer preferences, optimize product development, and tailor marketing strategies accordingly.
The integration of technology and data-driven decision-making enables PepsiCo to make more informed choices and adapt to changing consumer demands quickly. By leveraging the expertise of startups, PepsiCo can harness the power of technology and data to drive innovation, improve processes, and ultimately deliver enhanced experiences and products to consumers.
Focus on sustainability and social impact: In recent years, sustainability and social impact have become paramount in the food industry. Collaborations now emphasize shared values and purpose, with a focus on developing sustainable practices, reducing environmental footprint, and addressing social challenges. Startups and established companies are working together to create meaningful change that resonates with consumers.
Unilever, a multinational consumer goods company, has partnered with a startup called Impact Terra to support sustainable farming practices and improve the livelihoods of smallholder farmers in Myanmar.
Impact Terra is a social enterprise that has developed an app called Golden Paddy. The app provides farmers with crucial information and resources to improve their agricultural practices, access markets, and make informed decisions. It also helps connect farmers to financial services and weather information, enabling them to mitigate risks and increase their productivity.
Through this partnership, Unilever has collaborated with Impact Terra to scale up the use of the Golden Paddy app among smallholder farmers in Myanmar. By leveraging Unilever’s expertise in the agriculture sector and their commitment to sustainability, the partnership aims to promote sustainable farming practices, enhance farmer incomes, and improve the overall agricultural ecosystem in the region.
The evolution of collaborations between food startups and established companies over the past decade has been remarkable. These industry examples highlight the success of strategic partnerships, open innovation platforms, agility-driven collaborations, incubators and accelerators, technology integration, and sustainability-focused initiatives.
I’m eager to continue the conversation with you and hear your thoughts on the changing structure of collaborations in the food industry. Feel free to share your experiences and insights!
Interested in furthering the discussion on ways to increase the influencing skills of your team? Let’s connect!
To get regular tips for leading change and innovation, join my newsletter.
