Kellogg Company, the consumer packaged goods conglomerate, announced last week that it launched a venture capital arm called Eighteen94. The new fund will invest in early-stage startups serving the company’s core food-related categories, as well as in pioneering technologies that could help the food giant connect seamlessly with consumers. According to Kellogg’s official press release, the investment fund totals approximately $100 million.
Food has not tended to be a common sector for venture capital, but it has become more common in the last year or two with the growth in demand for healthy eating. Several renowned investment firms have begun investing in food and beverage companies, including Canaan Partners, which led an $18-million investment in 2014 in NatureBox. New venture funds have also popped up that are dedicated to food businesses at classic high-tech investment firms like Accel Partners (Accel Foods) and CircleUp. Among larger companies, Kellogg’s competitors General Mills and Campbell Soup Co. have both established food investment funds, known as 301 INC fund and Acre Venture Partners respectively. Taylor Fresh Foods, the leading low-tech producer of fresh cut vegetables, also recently led the Series A funding for rapidly growing smoothie-in-a-bag creator Nomva.
“By investing directly in the most promising entrepreneurs and ventures,” commented Gary Pilnick, vice chairman of Kellogg Company, “we can increase greatly our access to game-changing ideas and trends that could become significant sources of growth for us.” Eighteen94 will be managed by Kellogg veteran Simon Burton, with the assistance of San Francisco’s Touchdown Ventures.