Due to the uncertainties in worldwide food production brought by the Covid-19 pandemic, investors are piling into a vegan-oriented venture capital fund.
Venture capital firm Blue Horizon Venture based in Zurich, which primary focus is on sustainable food, has closed a 183 million-euro ($222 million) fund in order to invest in startups focusing on alternative proteins, smart packaging, etc. As stated by Managing Partner Michael Kleindl, more than 100 investors were interested in this fund which exceeded the set target of raising 100 million euros.
“Due to the pandemic, the awareness of sustainability and the loopholes in the food system became so evident,” Kleindl said in an interview. “Covid has accelerated the shift of capital toward more impactful, more sustainable investments.”
The rising need for alternative food sources is the result of climate change, a growing population, and most recently the pandemic. After the astounding success of Beyond Meat Inc., the company which has surged fivefold since its 2019 first sale of stock, investors are encouraged to allocate funds into environmentally friendly meat replacements, as well as the solutions to the food wastage. Venture capital firms are usually ones who are handling most of the investments in the "food of the future".
Venture-capital investors channelled $18.1 billion into food-tech startups in 2020, mostly caused by the big rise of food delivery apps or online grocers, as stated by researcher PitchBook.
Without disclosing too much information Kleindl reveals that Blue Horizon Ventures secured funds from institutional investors, as well as two pension funds. Alongside already mentioned investors there are the European Investment Fund, Mexican food manufacturers Grupo Bimbo SAB de CV and Sigma Alimentos SA de CV, Be8 Ventures Management GmbH, and Givaudan SA.
As the firm which employs 90% vegan/vegetarian staff, Blue Horizon Ventures, until now has backed startups such as plant-based meat producer The Livekindly Co. and lab-cultivated meat maker Mosa Meat BV.
“We really try to take the animal out of the equation,” Kleindl said.
In the last quarter of 2020, Kleindl revealed, the firm plans to launch a second somewhat larger fund. “The innovation we are seeing is truly amazing,” Kleindl said. “I can talk for hours about the cool companies we are seeing.