Startups in food tech develop products to replace basic staples like eggs
A rise in private equity-backed startups focusing on food technology is fueled by the goal to change how people eat.
CB Insights Chief Executive Officer Anand Sanwal said, "There's nothing to indicate that this will be a trend that will end anytime soon. Sustainability and challenges to the food supply are pretty fundamental issues." The New York firm venture capital investment tracker also added that venture capital firms who had been placing large sizes of investments in early-stage technology companies, appeared to have shifted its focus to food-related startups since last year. CB Insights said venture capital firms poured around USD350 million in startups related to food as compared to less than USD50 million in 2008.
Industry supporters have said that plant-based alternatives to certain basic proteins like eggs, poultry and meat were good for Mother Nature is it could reduce consumption of land, water and crops to produce them. They also added that plants are good for people's health, especially in areas like the US that eat a lot of meat, and reduce risk of disease outbreaks like the avian flu.
Berkeley Food Institute faculty co-director Claire Kremen at the University of California, Berkeley said, "The biggest challenge is that people who consume a lot of meat really like meat, and to convince them to try something different may be extremely difficult."
One group was apparently not happy with food development. The American Egg Board, which is a representative of US egg producers, said the egg is a basic food staple that could not be replaced. In a statement, board-funded Egg Nutrition Center executive director Mitch Kanter said, "Our customers have said they're not interested in egg substitutes. They want real, natural eggs with their familiar ingredients."
One startup that could threaten the egg market is Hampton Creek Foods. Backed by PayPal co-founder Peter Thiel and Khosla Ventures, Hampton Creek is conducting research on finding the culinary substitute of eggs in plants. Chief executive officer Josh Tetrick, who said they already have 11 potential substitutes, said, "Our approach is to use plants that are much more sustainable - less greenhouse gas emissions, less water, no animal involved and a whole lot more affordable - to create a better food system."