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NYC Conference Report #TechonomyNYC

Zoe Leavitt on Startups Stirring Up the Future of Food

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  • Zoe Leavitt of CB Insights presents on the future of food at Techonomy NYC, May 2018. (Photo: Rebecca Greenfield)

  • Zoe Leavitt of CB Insights presents on the future of food at Techonomy NYC, May 2018. (Photo: Rebecca Greenfield)

  • Zoe Leavitt of CB Insights presents on the future of food at Techonomy NYC, May 2018. (Photo: Rebecca Greenfield)

Speaker

Zoe Leavitt
Senior Retail and CPG Analyst, CB Insights


Session Description: Massive innovation is changing what we eat and how it’s made.

Below is the session transcript and a PDF version is available here.

Startups Stirring Up the Future of Food

(Transcription by RA Fisher Ink)

Leavitt: I’m here representing CB Insights, which provides innovation consulting to leading corporations around the world. And today I will be giving a very quick, very brief overview of the future of food, looking at emerging startups, how momentum technologies and corporate activity, shaping how all of us will be eating 5, 10, 20 years out.

Today, the food industry faces two major and somewhat diverging concerns. On the one hand, we need more food to feed our growing population. Earth is going to be supporting 10 billion people within the next few decades. And of course, farming productivity has massively improved over the past few decades, but looking forward, we’re going to need to prepare for this population growth, as well as prepare our crop yields to react to global climate change. And even today, so much of the food that we do produce is wasted. Nearly 40 percent of the food that’s grown and harvested in America gets throw out every year, amounting to roughly $160 billion of wasted food per year.

So this is what we need, but what do we want? I think for all of us in this room who are lucky enough to have our basic needs taken care of, we’re looking for more out of our food. We don’t just want something that will fill us up in the short term. We want healthy food, we want it to be convenient, we want it to be delivered on our schedule and we want it to help us live to 150 while still maintaining great hair and skin and all that.

[LAUGHTER]

So looking at these two divergent problems, what we need and what we want, we do see some of the same technologies tackling both issues. So I’ll touch on those briefly on this short talk. I’m happy to discuss in more depth later on, or share these slides afterwards, starting with how technology is actually reshaping some of the food products themselves, then looking at how new technologies and agricultural strategies can help us prepare for climate change and boost crop yields. And then, finally, looking at smarter distribution methods that can make eating healthy more convenient for more people while also reducing waste.

Starting with improved food products, I think the most exciting trend to watch here is lab-grown meat. This has been in the news recently, but this refers to startups that are actually growing real animal, molecules of animal meat in the laboratory, rather than through animals. And I think the interesting concept here is that, if you think about livestock, a cow is really a very, very inefficient way to turn sunlight and grass and water into the steak on our table.

So what if we could just take those inputs and turn that directly into the steak or the hamburger, without all the waste, all the water usage, all the land usage, all the greenhouse gas emissions that comes with raising those cows? That’s what startups such as Memphis Meats are trying to do. Memphis Meats is backed by Bill Gates. They’re a real leader here. They have unveiled, so far, a lab-grown meatball in 2016 that was at the somewhat unapproachable cost of $18,000 per pound.

[LAUGHTER]

But they’ve already actually managed to reduce that to $9,000 per pound just in about a year, so if we see the cost continuing to reduce at this rate, this is something we can really see on our tables pretty soon. The main technological breakthrough to watch out for is, scientists now do have to grow the animal cells using a base of blood, which is a bit distasteful as well as very expensive. But when scientists are able to develop a plant-based serum for growing animal cells, lab-grown meat could really take off.

We also see startups like Finless Foods looking not just at red meat, but at fish, which they say requires less energy to grow than red meat. Also, startups growing dairy proteins in the lab, gelatin the lab, and even some startups that are looking to grow pet food, meat pet food, in the lab. So a whole range here. And of course, just as with any new food, new strategy, new technology, we’re already seeing a backlash. Some ranch associations recently filed a petition to the FDA to protect them from growth and lab-grown meat. We’ll likely see more of this, and more of this backlash, as lab-grown meat and meat substitutes continue to grow, likely playing to nostalgia and the cowboy Americana attitude and things like that.

But on the other hand, some of the leading, global leading meat players, are already preparing for this world in which we’re less reliant on animals and looking more toward plant protein and lab-grown meat. Cargill and Tyson have made equity investments in some of the startups you see here. And China, which is rapidly becoming one of the world’s biggest consumers of meat, is also getting onboard, recently signing a deal with Israel to import lab-grown meat, reducing the environmental impact of their livestock while also, in the future, opening the door for potentially personalized meat products, things like that.

And in the meantime, we are seeing startups and investors look to new sources of plant protein to move us away from meat, reduce environmental impact, and also promise long-term health and wellness benefits. Some of these emerging ingredients are pea protein, mushroom protein, startups using more exotic fruits like moringa, maca, and monk fruit as healthier sweeteners. And even cannabis, as it’s increasingly legalized throughout the U.S., is going to have a major impact on the food space. Even already, the reason Corona is up here is that their parent company did already invest in a medical marijuana startup to hedge for that move away, potentially, from alcohol. So it’s another plant-based product to watch.

A move on now to startup looking at new agricultural strategies to improve crop yields while reducing environmental impact. And this has been a hot area for startups and investors over the past few years. We’ve seen $2 billion poured into agriculture technology startups, some of which we’ll be speaking with on our panel in a few minutes. And these range in focus from robotics that pick apples. Interestingly, or perhaps somewhat perversely, the difficult immigration environment today that we see in America may actually lead to some more manual farming processes becoming automated. We also see startups like Airware, using drones to collect data and help us better prepare for and predict the impact of climate change, and startups, which are offering connected IoT irrigation systems that help farmers improve efficiency while reducing water use.

This has gotten onto the radar of big technology companies, too. Google Ventures, Alibaba, even Jeff Bezos, himself, has invested in agriculture technologies recently. And even retailers. Walmart recently applied for a patent on a robotic bee, which would, I think, many of us may have heard that the bee populations around the world are struggling. So Walmart is maybe looking to robotic bees to improve yields on, and the quality of, produce that they can sell in their stores.

We also see startups reinventing the idea of the farm altogether. We’ll discuss this more on our panel, but these startups offer indoor farming solutions that massively reduce the amount of water and land needed to farm crops, while also literally offering food that can taste better and have higher nutritional value. We all just tasted the AeroFarms offering out there, but because the nutritional value of food does tend to degrade the longer the supply chain is, since these indoor farms can be closer to the end-consumer, the food that gets to our tables would be more nutritious.

Finally, we’ll look at startups improving the supply chain. And here, I think, if we think about what would be the ultimate holy grail, in terms of efficient nutrition for the world, we imagine each person getting exactly just as much as they need when they need it. And we see some of a bit of divergence here, too. Some startups and businesses are looking at, simply to provide what a human needs on a daily basis. There we see startups like Soylent, which offers the bottled meals, or some of the food bars that you see showing up in dystopian movies where these companies say, “Here’s all the nutrients a human, theoretically, needs to sustain them daily. We can get that to you in a very convenient way.”

On the other hand, we see businesses looking at hyper personalization, saying, “Here is what you, as an individual, need on a daily basis. Here we can get that to you.” So some companies already are trying to build off the success of 23andMe, looking at DNA test-based personalized diets. The science there is really not quite there yet. Though we may be better able to parse the human DNA today, we still simply don’t know how a lot of food groups affect long-term health and wellness. All you have to do is Google research studies about the impact of red wine or chocolate to see the debates that go on there.

So that’s not quite there. But meanwhile, we can gather data in other ways, rather than DNA. So Internet of Things technology can be a big player here. Indeed, a collection, either through wearables, which have already, of course, been around for a few years, as well as smart home technology, which can include smart kitchens that can monitor what people are really consuming and when.

So we see smart kitchen startups, like Innit. Even Google has looked into smart mirrors that can, theoretically, diagnose diseases while you brush your teeth in the mirror, and then could potentially, of course, use that data to suggest a personalized diet for you. And then, once IoT has collected that data, artificial intelligence has analyzed it, we can see 3D printing used to create personalized food products. Either personalized from an aesthetic perspective, like we see here on the left, or personalized from a nutrients perspective, with a 3D printer depositing just the right amount of vitamins into a pill. For example, that picture on the right is from a startup called Multiply Labs that’s doing exactly that.

And then, the delivery process can also be personalized, making it more convenient and, potentially, reducing waste. Brands are already preparing for this future of predictive ordering. Procter & Gamble, for example, has patented a system of connected tags that would be attached to products, monitor your usage, and then automatically order a replacement when that product is used up.

We can also see cars being hosts to producing personalized food products in the future. Zume, which is a startup in Palo Alto, is already doing that using robots to make pizzas in the back of delivery trucks, while that delivery truck’s on route to the customer’s house, so that pizza arrives fresh, freshly baked, hot and personalized, to their doorstep. Walmart has also looked at delivery trucks that could hold 3D printers, or even small vertical farms inside the delivery trucks, making these delivery routes more efficient.

And of course, leave it Amazon to bring these technologies to their wild conclusion. Amazon has looked into using all this data that could be collected through smart homes, through wearables, about what people need and when they need it, to actually move their warehouses in real-time, bringing where the food would be stored as close to the consumer as possible. Amazon has looked at flying warehouses that could fly toward neighborhoods, could adapt in real time to shifting demand in different neighborhoods and get that food to customers on the ground as quickly as possible.

So we’ve been through a lot very quickly. We’ll go through the panel, but the key takeaways here are that new technologies can help us feed the future by creating new ingredients, offering us more efficient farms, and improving the distribution strategies of food companies. Thank you.

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