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Now is the time to invest in foodtech

Infecting the industrial world in the manner of an Australian bushfire The Covid-19 virus has ravaged communities that it has left behind. The stock market has collapsed just as do Arctic glaciers on July. Millions of people are without work and more than half of the world is in a solitary position.

The coronavirus outbreak is the most disruptive global phenomenon in the world since World War Two. The world we was familiar prior to the turn of the millennium will appear and behave in a different way as we enter an era of new decade.

Investors are seeking different perspectives to withstand the challenges ahead and now more than ever before, FoodTech is a standout because of its importance and strength, as well as its potential and the advantages it offers. We’re sure to say that We’re FoodTech VC and below, we’ve outlined some of the unique ways FoodTech can withstand this storm.

Rewiring supply chains

The pandemic is awakening corporations and governments to the essential value of food. It hasn’t been a pleasant wake-up signal. The strength of supply chain food suppliers has been tested to the limit as whole models change from restaurant to retail as well as home deliveries. Many retailers including the most renowned names, had been in desperate need of innovation prior to the recession. Today, they require more than ever before, but budgets are being moved away from R&D to other , more immediate issues.

This opens up huge opportunities for cool-headed fast mover. Intense sanitary needs and social distancing are likely to be the main requirements for warehouses and processing facilities. This will happen regardless is happening, and it could cause delays or require technologies to be developed which allow for more from afar. The stale legacy systems that have been in place for a long time have prevented the innovative ideas from being implemented in the past, however the current conservatism is no longer viable.

Automating and digitizing supply chain processes is a necessity and technology is rapidly evolving to tackle the challenges. Computer vision plays a part in remote quality monitoring that provides continuous surveillance and analyses. Innovative refrigeration methods are being developed as well as better bio-packaging options or drone delivery.

Consumers who are part of the new normal’

Elasticity of the supply chain has been tested by the radical shift in consumer behavior too. There has been a lot written about the increasing sales of protein-based plant companies in the wake of the crisis, the acceleration of an already existing trend towards flexetarianism, or veganism. There is also an increasing desire for food products that is healthier. Based on data we’ve received from Tastewise the Peakbridge portfolio firm that collects insights about food trends from social media as well as other data sources, an entirely new standard is beginning to emerge in the minds of the public. The interest on “immune system” has increased 66% from February, the company’s analysis illustrates. Interest in “stress relief” as a benefit of food, for instance, has increased by 12 percent in the past year and is expected to grow in the months ahead. For instance the herb rosemary, which is commonly believed to ease stress, has been increasing by 114% in discussions regarding stress relief over the past year.

Reviewing several other information included in the Tastewise information the senior industry executive Dr Ellen De Brabander sees a increasing demand for traceability. It’s becoming clear that, according to her, consumers and regulators alike are requesting greater traceability of ingredients and products. This can only be achieved through the rapid deployment of digital technologies, be it they are RFID, QR codes satellite imagery, blockchain.

It’s also important to consider whether some of these Tastewise trends will be a permanent new normal or something that will fade after the lockdown ends. There is no way to know if certain trends that have been gaining momentum this moment, such as having breakfast in your home, will end within a year. But in some way, you’ll have to be able react quickly. You can’t think that you’ve selected the right scenario. The ability to react quickly to the changing situation is more vital than ever and the companies that can do what they do will be in the top position for the long time.

Sugar reduction, healthier living

Food markets also have to respond to the threat of the virus when it is spreading around the globe. With research indicating that we are as long than 18 months from having a vaccine, much attention is being paid to the various ways to fight off the virus by living in a healthier metabolic state. According to a leading doctor of endocrinology and director of the Glandt Center for Diabetes Care Dr. Mariela Glandt, Coronavirus survival rate will be influenced by much to do with the food we consume and how we prepare it. About 70 percent of US people suffer from a type of insulin resistance that hinders the body’s ability to fight disease. This is the Metabolic Syndrome, where, because of insulin resistance, the body can’t manage its food intake, which causes crucial white cells become weak and ineffective and leaves the body vulnerable to disease and infection and vulnerable to the fatal Coronavirus.

The majority of Europe and Asia In Asia and Europe, there is a Coronavirus mortality rate is generally affecting the elderly. However, Dr. Glandt anticipates a younger group being affected within the US which is where the majority of are suffering from Metabolic Syndrome. “Put in a simple way, we’ve developed illness due to the food we consume.” Dr. Glandt tells us. “Refined sugar and refined oils, as well as fats, and preservatives have contributed to our predisposition to cancer, strokes, as well as cardiovascular disease and have caused many of the life-threatening illnesses that are making the patients suffering from Coronavirus extremely sick.” Dr. Glandt is the founder of EatSane which is a Tel Aviv-based company that specialises in low-carb options that lower the chance of developing Metabolic Syndrome. She believes that the coronavirus ring is an alarm signal for all people of the world to reset their diets and not only treat diabetes, which is at the root of many health problems, but instead address the root cause of the problem: “Going cold turkey on carbs can be hard to sustain, but cutting down on the amount of carbs you consume slowly is the most effective method to decrease levels of insulin and their susceptibility for Metabolic Syndrome.”

We are witnessing more FoodTech companies similar to this. Each company is looking for their unique way ways to still enjoy our food and still be healthy. As the consequences of the most deadly pandemic that will befall the world of today emerge, sugar-reducing solutions like low-carb bread and chocolate that is low in carbs are the solutions that the world desperately needs in order to stand the Coronavirus in the best healthiest metabolic state. They are also welcomed allies of the wasteline to people who are stuck in their homes.

Yet, such companies might be shattered in a sluggish financial environment. The current financial climate is a reminder to an experienced entrepreneur as well as PeakBridger Rick Borenstein of the 2008 financial crisis and its consequences. “The most obvious connection is the challenging fund-raising environment venture-backed businesses are confronted with,” he tells us. “Capital preservation was the norm in 2008 and remains exactly the same in the present. I set up an investment fund in the month of March 2009 and was immediately awed by how rich a target atmosphere it was at the time. Any company, regardless of how innovative, required money. I turned these circumstances in my favour. My money, however small it was in the moment was accepted to the best deals.”

Borenstein believes that while the economic effects of the virus may last for a while, certain sectors are sound fundamentally and are expected to rebound. The Coronavirus could make people better aware of positive role future food investment could be playing in a world that is set to be reactivated: “I expect investors to be more interested in the social consequences of the projects they invest in, which could result in a significant increase in sectors like the FoodTech as well as Agtech sector.”

Food that is delicious and never going away

Food, in fact is one of the industries that are least affected by cyclicality. Contrary to the terribly hit entertainment and tourism industries when there are depressions or downturns, and even pandemics, we still have to provide food for the table, and plenty of it.

It’s the reason it’s one of the most vital industries that have to push forward in the face of the threat of a new virus. With unemployment rising in the food industry, it is currently on a hiring surge. PepsiCo has announced that they would be employing 6000 additional employees to meet the soaring demand caused by the current crisis. Similar news is reported from Papa John’s, Mondelez, Dominos, Kelloggs and other giants of the food industry — all of which have announced that they will create thousands of jobs as they attempt to satisfy an already hungry, anxious, and customers who are stockpiling. General Mills recently said it has increased its forecast for 2020 in the wake of customers stocking up on snacks and cereals. The the demand for food increased but it has not slowed down but it has increased.

The Food and Beverage sector has substantially exceeded the S&P 500 from the middle of February (see figure C) like it did in the US as well as Europe during the time following the 2008 economic crisis.

The awakening of the environment

The Coronavirus has brought the world down in its ways in a way that other existential threats would only imagine. On reflection, this is a time to consider something about more than hygiene and personal health. This is a time to contemplate the impact that our species is having on. As we humans scream in the reality they thought they were shielded from, thoughts are starting to swirl towards a re-boot and a more sustainable and cleaner planet that is not surrounded by our bubbles. This is the challenge the FoodTech industry could take on.

When we discussed the issue with an eminent chief agricultural officer at Mars and our friend Peakbridger Dr Howard-Yana’s ShapiroDr Howard-Yana Shapiro emphasized the extent of an environmental alert this is. “How many times do you damage the ecosystem’s fabric and it can’t be saved? Let’s take Ebola it was in existence for about since the 1980s, and people were aware about it, yet we tore enough of of the ecology within the region where it was able to get away. The current situation with Coronavirus is similar. We’ve ruined the ecology to the point where it’s not able to heal. We’ve lost our buffers.”

All in all, Shapiro believes we are living in opportune and unique time for agriculture and food: “For the first time in our history, we have a united view of the relationship between agriculture and food: We know the components of food on a molecular basis, and what it does in our bodies, and why every single food ingredient is essential to our well-being, health or growth. This understanding isn’t occurring in isolation, but is happening simultaneously across the entire field. We are beginning to learn what we can do.”

Shapiro observes that since the markets fell the last few years, all he hears on his business news channel is the incredible price in Apple or Google stock. However, he believes the real value is in companies that know what food is, and possess the tools and knowledge to create something different. “What If you handed Machine Learning the rules for food? What type of tomato would it produce?”, he speculates with excitement. “Fast shifting food businesses that are aware of science will be able to transform the way we think about the food industry in the next decade.

After having spoken with certain thinkers within our network, it’s time to reflect on our own home. When thoughts turn to the next day we’ll think about the following future investments:

Their importance to the current issues and ‘pains’ that we currently confront

The safety of the industry

Their revolutionary innovation

The role they’ll play in shaping the future of our planet

Their value on the market

FoodTech in 2022 checks several, if not all one or more of the following boxes. FoodTech investment offers the chance to earn significant profits and an opportunity to play an active role in a world changing its course. This is the way we’ll spend our time at home.