From 2012 to date there has been a new wave of investments in innovative companies related to the food industry. An increased number of transactions was coupled with the involvement of the major players of the venture capital industry. Startups operating in the food tech area are revolutionizing the way food is produced, distributed and consumed, and are revitalizing an entire industry with new business models and customer experiences. A significant pipeline of open innovation opportunities has been generated, with the potential to structure acquisitions, commercial deals and partnership between big industry players and startups.
2. Executive Summary
From 2012 to date there has
been a new wave of investments
in innovative companies related
to the food industry. An increased
number of transactions was
coupled with the involvement of
the major players of the venture
capital industry.
Startups operating in the food
tech area are revolutionizing
the way food is produced,
distributed and consumed, and
are revitalizing an entire industry
with new business models and
customer experiences.
A significant pipeline of open
innovation opportunities
has been generated, with
the potential to structure
acquisitions, commercial deals
and partnership between big
industry players and startups.
P101 is positioned at the
forefront of the food tech market
and could act as a key player
in the innovation process: the
fund has invested in relevant
startups in this sector and it is
continuously scouting the market
for new teams and technologies.
3. Just Eat IPO Values It At $2.44BN, Company
First To Test LSE’s New Tech-Friendly Market
TECHCRUNCH - Posted Apr 3, 2014 by Mike Butcher (@mikebutcher)
Tamburi Investment Partners Invests
120 Million Euro in Eataly
PAMBIANCONEWS - Tuesday 11 March 2014
Confidential Information
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Food Startups
are hitting the headlines
Exclusive: Blue Apron raising
new funds at $500 million
FORTUNE - By Erin Griffith Posted April 7, 2014 3:36 PM ET
The food industry is transforming itself through open innovation,
digital technology and new customer experiences
4.
5. Confidential Information
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Market overview:
Food & Beverage funding scenario
Total
Food & Beverage
funding
Q1 2012 - Q1 2014*
60
50
40
30
20
• $1.38 Bn invested (VC, PE, Corp VC, Angel) in 2013, mostly US data
• 397 deals; +37,4% yearly growth
• Q1 2014 was the best quarter in term of number of deals
M&A
(Food & Beverage)
IPO
(Food & Beverage)
2012 Q2
10
0
2012 Q3 2012 Q4 2013 Q1 2013 Q2 2013 Q3 2013 Q4 2014 Q1
Number of exits
* Source: CB Insights
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Market overview:
Food & Beverage M&A
Total
Food & Beverage
M&A deals
Q1 2012 - Q1 2014*
60
50
40
30
20
• 197 exits last year
• +55% yearly growth
• Q1 2014 was the best quarter in term of number of exits
M&A
(Food & Beverage)
IPO
(Food & Beverage)
2012 Q2
10
0
2012 Q3 2012 Q4 2013 Q1 2013 Q2 2013 Q3 2013 Q4 2014 Q1
Number of exits
* Source: CB Insights
7. 148
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Market overview:
Food Tech & Media
Total Food Tech
& Media VC
investments
and M&A deals
2012 – 2013* US
$2.0
$1.5
$1.0
• 2013: $1.6 Bn invested in in Food Tech with 148 deals
• 2012: $1.2 Bn invested with 132 deals
• Average deal size from $4.6 M to $5.6 M
• Excluding the Media component, $930 M invested in 2013
and $560 M for 2012
Food Tech/Media
Investment ($B)
Total in investmenting in billions
Number of investments
Food Tech/Media
Investment ($B)
(Adjusted)
Food Tech/Media
Investment Deals
Food Tech & Media investments higher
than Food & Beverage
* Source: Rosenheim Advisors
$1.2
$1.6
$0.6
136
$0.9
$0.5
2012 2013
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360° change:
Ordering, delivery, analytics, media, social
Each area of the food experience
is disrupted by digital technology
* Source: Rosenheim Advisors
Recipes and Cooking
Communities
Publishers
Grocery / CPG
Coupon Distributors
Mobile / Online
Ordering
Mobile / Online
Ordering (B2B)
Commerce
Restaurant Reviews
and Search
Personalized
Restaurant Discovery
Online / Offline
Communities
Restaurant Coupons
and Deals
Next Gen Restaurant
Ordering / Payments
Restaurant Loyalty
Rewards
Reservations
Restaurant Marketing
/ Analytics
Grocery / CPG
Coupon Aggregators
Grocery / CPG
Mobile Coupons
Grocery / CPG
Loyalty Rewards
Digital Content
Vertical Ad Networks
Product Guides
and Discovery
Recipe Box
and Search
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Open innovation:
leveraging lean startups
“Everyone eats, everyone is online;
what the hell we waiting for?”
Dave McClure – 500 Startups
Space for disruption:
• New layers in the food experience: local, social, mobile, metadata,
ecommerce, digital payments, analytics, retail
• Inefficiencies still exist: personalized & health choices, logistics &
routing, waiting time, social layer, recommendations.
• New startups are lean, fast & experiment at low cost
Open innovation is key to corporate success:
• Example: Google has acquired 91 startups since 2010
Open innovation trhough food startups:
• Startup acquisitions bring high-potential innovation at low cost
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Food Startups:
Areas of innovation
• Recipes and Cooking Communities
• Recipe Box and Search
• Publishers
• Digital Content
• Vertical ad Networks
• Product Guides and Discovery
• Grocery CPG: Coupon Distributors, Coupon
Aggregators, Mobile Coupons, Loyalty Rewards
• Mobile / Online: Ordering, B2B transactions
• Food Ecommerce
• Food Delivery
• Product Deals / Offers
• Restaurant Review and Search
• Personalized Restaurant Discovery
• Reservations, Ordering, Payments
• Restaurant Marketing / Analytics
* P101 elaboration on data from Rosenheim Advisors
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Trends
in the new food tech startups
Grocery delivery integrated with recipe
discovery and cooking-related educational material
Pick up spots delivery options
(beyond home delivery), weekly featured food
Focus on health, nutrition, lifestyle
and women consumers
New verticals: tools for restaurants,
office catering, school catering, lunchboxes
Video for food lovers, cooking lessons and other
rich media content
Global repositories beyond restaurants:
recipes, chefs, kitchenware
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We are not in the 90s
Dotcom companies
failed because of flawed
business models and wrong
cost structures
…times Have changed:
• Robust business models
• Smarter investors
• Lean approach: experiment, fail fast, learn
• Drop in start-up launch & development costs
BuT
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The customer experience
Examples from the Italian ecosystem
I Plan
I cook
I buy
I share
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Example of a “hot spot”:
the food delivery area
During the first 4 months of 2014:
$177 M VC investments
in the food delivery area
15. 25
20
15
10
5
• Food delivery startups funding up 51%
• 4 out of 5 of Food delivery VC deals take place outside Silicon Valley
• European example (Berlin): Delivery Hero raised $300 M overall
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Food delivery
hits 5-year high
Q1 2013 -Q1 2014:
* Source: CB Insights
Funding
(food delivery)
Deals
(food delivery)
Million USD
200
150
100
50
0
2009 Q2
2010 Q4
2012 Q2
2010 Q1
2011 Q3
2013 Q1
2009 Q3
2011 Q1
2012 Q3
2010 Q2
2011 Q4
2013 Q2
2013 Q4
2009 Q4
2011 Q2
2012 Q4
2010 Q3
2012 Q1
2013 Q3
2014 Q1
Number of deals
0
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Food Tech
investments topology
Advertising,
marketing
& analytics
Communities
& media
Restaurant
services
Restaurant
Order
& delivery
Ecommerce
&
Marketplaces
Grocery
delivery
Mass
market
Physical
& delivery
focus
Media
& digital
content
focus
Niche
focus
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Investors
in food tech companies
Example:
JustEat raised funding from top investors such as Greylock and Index.
IPO in April 2014
18. CompanY $M CompanY $M CompanY $M CompanY $M
Olo 5.0 Chewse 1.0 Tastemade 10 MyCheck 4.2
Abe’s Market 5.0 Eatclub 5.0 Punch 3 Tabbedout 7.75
ChowNow 3.0 FarmersWeb 1.0 Glam Media 25 MouthFoods 1.5
LocalResponse 1.5 LoyalBlocks 9.0 Blue Apron 5 Index 7
EatStreet 2.0 Swipely 12.0 Dryinc 0.9 Yub 12
Blu Apron 3.0 Marqeta 14.0 MyFitnessPal 18 Postmates N/A
Kitchensurfing 1.0 Foodpanda 20.0 Aisle50 2.6 TouchBistro 4.5
ClubW 3.1 Panna 1.3 Clutch 5.3 Qloo 3
Moment Feed 1.8 EMN8 51.5 DoorDash 2.4 Sprig 1.2
Perkville 0.5 Revel Systems 10.1 Leaf 20 Zomato 37
Food 52 2.0 E La Carte 13.5 Goldbely 3 ShapeUp 7.5
500friends 5.0 MyWebGrocer 154.0 HelloFresh 7.5 Delivery Club 8
Tastemade 5.3 Belly 12.1 GoodEggs 8.5 The Orange Chef 1.2
Relay Foods 8.2 Naked Wines 10 Zipments 2.25 MomentFeed 5.5
HealthyOut 1.2 Gratafy 1.45 Mogl 1.1 Freight Farms 1.2
Plated 1.4 Delectable 2 IfOnly 12 Gousto 2
SavingStar 9.1 GrubHub N/A Real Food Works 1.5 PowerSupply N/A
Kitchensurfing* 3.5 Restorando 13.3 Butter Systems N/A Daily Secret 1.25
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Food Tech & Media
investments 2013 - Selected
Excluding $154 M MyWeb Grocer growth deal, Foursquare $35 M deal and Yelp’s
$288.9 M new stock offering. Excluding angel investments and deals below $500k
* Two deals in the same period
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Food Tech & Media
investments 2014 (January-June)
CompanY $M CompanY $M CompanY $M
GetYourGuide 4.5 Dash 1.2 Meican 10
BrightFarms 4.9 Granular 4.2 PunchTab 6.5
Yiftee 2.1 Postmates 16 Blue Apron 50
Food Genius 1 iFood 2 DeliveryHero 85
Drizly 2.25 Tapingo 10.5 AgLocal 1.3
Venga 1 Foodpanda 20 ezCater 3
Farmlogs 4 Noom 7 NatureBox 18
Main Street Hub 14 Kitchensurfing 15 Munchery 28
Culinary Agents 0.5 Ricebook 7 Drync 2.1
Delivery Hero 88 Spring 10 Spoonrocket 11
Planted 5 TouchBistro 1.5 EatStreet 6
Excluding angel investments and deals below $500k
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Food Tech & Media
M&A 2013 - Selected
Buyer Target Value ($M) Buyer Target Value ($M)
Yahoo Alike N/A GoDaddy Locu 70
Pinterest Punchfork N/A Groupon Plumfare N/A
Pinterest Livestar N/A Zero Point Zero FoodRepublic N/A
TripAdvisor Tiny Post N/A Groupon Sidetour N/A
Twitter Spindle N/A Food52 RealTime Farms N/A
OpenTable JustChalo 11 Anderson Press Caskers N/A
OpenTable Foodspotting 10 First Data Corp Perka 30
DeliveryHero Hungryhouse N/A eBay Shutl N/A
DeliveryHero EatitNow N/A 8Coupons Clipless N/A
PMB Pushpins 10-15 (est.) AgSquared Local Dirt N/A
Fancy Samplrs N/A UnderArmour Map My Fitness N/A
Jawbone MassiveHealth N/A VoxMedia Curbed Network 20-30 (est.)
Coupons.com KitchMe N/A GoodEggs LolaBee Harvest N/A
Target Cooking.com N/A Coupons.com Yub 30
Target Chefs Catalog N/A Cookpad Althecooks N/A
Seamless (merger) GrubHub N/A OpenTable Quickue 11
EMN8 Snapfinger N/A Lifelock Lemon 42.6
Harvest Mark ShopWell Solutions N/A Square Evenly N/A
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Food Tech & Media
M&A 2014 (January-June) - Selected
Buyer Target Value ($M)
MacMillan Publishers Cookstr N/A
Leapset Punchfork N/A
Walmart Yumprint N/A
Kroger You Technology N/A
Datalogix Spire Marketing N/A
MyWebGrocer Buy4Now N/A
OpenTable NessComputing 17.3
XO Group Gojee N/A
Mobivity SmartReceipt 3
JustEat Meal2Go N/A
Blue Bottle Cofee Tonx N/A
Priceline OpenTable 2600
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Why acquire?
A
Example:
Walmart acquired Yumprint in Q1 2014 to improve its grocery delivery strategy
Yumprint analyses recipes, nutritional information and consumer preferences
The website also matches ingredients with advertisements and prepares
shopping lists
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Why acquire?
B
Typical buyers needs in food tech acquisitions:
• New sales & distribution channels
• Integration with databases and APIs
• Access to younger population
• Access to mobile & social layers
• Geographical expansion
• Expansion to new product categories
• Content acquisition
• Talent acquisition
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Significant IPOs in 2014
In Q1 2014 tech companies saw robust M&A activity and exit potential.
Food tech startups reached successful IPOs
Just Eat:
valued at
$2.4 BN
GrubHub:
valued at
$2.7 BN
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Growing Ecosystem:
Incubators
Lean food startups now growing in vertical incubators
VC funds such as Accel Partners are supporting the process
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Growing Ecosystem:
Events
Tailored events are structuring the ecosystem and building knowledge
about go-to-market and growth
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Big players join the race:
delivery
Big retailers and ecommerce websites are increasingly involved in same-day
grocery delivery
• “Fresh service”: Started in 2007 in Seattle
• Recently expanded to Los Angeles
• 500k available items
• Now expanding to San Francisco and other 20 locations,
including non-US
28. A B Nestlè GoScan app
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Big players join the race:
consumer giants release APIs
Ingredients and other food datasets are increasingly available
trhough new APIs
Examples:
Kraft Application
Programming Interface
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More innovation
Food 3D Printig
A
New desktop 3D printers shape food as their “ink”
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More innovation
Drone delivery
B
“30 min delivery service”
trough unmanned aerial vehicles
Program confirmed by Bezos in the 2013 letter to shareholders
6th generation of drones developed at Amazon
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More innovation
Big Data & Food Tech
C
Data science is overtly applied by several food startups and big tech players
Example:
recipes & ingredients
Companies Recipe sourcing models
Food bloggers
Social networks
Semantic tech
All industry players Databases
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Italian food startups are growing
E-commerce
& delivery
Restaurant
services
Social food
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How to leverage the market
Internal innovation:
• Explore the new layers generated by digital technology.
• Each process in the food experience could be leaner, smarter and more
efficient
Open innovation:
• Look for M&A opportunities: the new wave of food startups is generating
smart and scalable solutions
• Key factors are low development costs, access to new demographics,
innovative processes and new sales & distribution channels
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P101 as Innovation Hub
Powering the Italian Ecosystem:
• P101 is a venture capital fund focused on digital technology
• The firm is positioned at the frontier of the market and screens hundreds
of entrepreneurial projects per year
• The fund is empowered by a network of incubators, research institutions,
investing partners and entrepreneurs
• P101 invests in innovative companies with a significant portfolio
allocation in food tech & media startups
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public savings and is exclusively addressed to the recipient specified above
(the “Recipient”). All the data in the present document are for information
only and Programma 101 will not be liable for any action the Recipient
may decide to take in total independence and autonomy.
The information included in this document is subject to the risks and
uncertainties of the Internet, Media and Telecoms markets.
All forecasts reflect market parameters, assumptions and other fundamentals
that may be subject to change and therefore affect future results.
The Recipient declares to have specific experience in the field of
investments in financial instruments and to be properly advised by
qualified consultants in the valuations of their investments.
The information in this document is Confidential and must be treated
as such.
Disclaimer