Kellogg Co. in June joined the ranks of big food companies with venture capital arms, unveiling "eighteen94 capital" (1894 for short) to make minority investments in companies pursuing next-generation innovation.
The company has earmarked $100 million to invest in start-up businesses pioneering new ingredients, foods, packaging, and enabling technology.
"As consumer preferences move toward more diverse tastes and trends, the pace of innovation in the packaged food industry continues to intensify," said Vice Chairman Gary Pilnick. "By investing directly in the most promising entrepreneurs and ventures, we can increase greatly our access to game-changing ideas and trends that could become significant sources of growth for us. At the same time, we will be providing these companies with essential growth capital and access to Kellogg resources and expertise, which will help drive their ideas and businesses. It's truly a win-win."
1894 will invest in emerging businesses in both Kellogg's core categories and adjacent categories, and in companies that have developed new consumer-driven technologies that could lead to long-term, mutual growth opportunities. While stage-agnostic, the fund will emphasize early stage opportunities with companies that have demonstrated good product and market fit and have generated initial revenue.
That $100 million "will play an important role in achieving Kellogg's 2020 strategic growth objectives," the company said.
1894 will be managed by Simon Burton, managing director, a 10-year executive at Kellogg who also has extensive investment experience in the consumer products sector and with start-ups. In addition, Kellogg has partnered with Touchdown Ventures, which specializes in corporate venture capital, to assist with management of the fund.