July 26, 2023

By Lynda Kiernan-Stone, Global AgInvesting Media

It was in April 2022 that 301 INC, the venture arm of General Mills, committed a combined $15 million to two early-stage venture capital funds dedicated to supporting food enterprises led by women of color as part of its dedication to promoting racial and gender equality through economic opportunity.

One of these funds was Supply Change Capital – a women and Latina driven venture firm, with a mission to invest “at the intersection of food, culture, and technology” in order to support early stage food and food tech founders that incorporate a focus on sustainability, health, and diversity.

Supply Change Capital is led by Noramay Cadena and Shayna Harris, two industry veterans who met in 2009 in business school at MIT, who have made more than 100 investments to-date. Cadena is a mechanical engineer who for a decade brought complex space programs to market at Boeing and then entered venture capital in 2015, and Harris is a food industry expert with C-Suite executive leadership and strategy experience in fast-growth food and software startups, and as a tenured and global lead for sourcing and impact at Mars. 

With a focal point on culture and climate, Supply Change invests in early stage tech companies responding to the dramatic shifts occurring in the $10 trillion global food system. 

Forty percent of new businesses in 2020 were launched by women, and of those launches, 47 percent were by women of color. And when examining the last decade, Latinos represented the fastest growing demographic of entrepreneurs in the U.S., growing by 34 percent, according to Stanford University, compared to only 1 percent for all other groups.

However, during 2020, funding for women and minorities actually declined, with only 2.6 percent of venture capital deployed as of August 31, 2020 landing with Black and Latinx founders, according to Crunchbase. And more recent data from McKinsey shows that in 2022 only 1 percent of venture capital went to Black founders, 1.5 percent went to Latino founders, 1.9 percent went to women founders, and only 0.1 percent went to Black or Latino women founders. 

Furthermore, on the opposite side, only 16.1 percent of venture capital decision makers are female, and only 2 percent of venture capitalists are Latina/Latino. 

The Supply Change portfolio represents the vast opportunity that these numbers represent for investing with an eye toward sustainability, health, and diversity in the food and agriculture space. 

~ 100 percent of the portfolio companies have positive impacts on the environment, health, and/or diversity outcomes.

~ 80 percent of the portfolio comprises Latinx, Black, and/or Female founder/CEOs.

~ 73 percent are focused on positive environmental outcomes related to the atmosphere, soil health, biodiversity, or water. 

~ 60 percent of the portfolio offers products and services that improve health. 

“Supply Change Capital invests in the technologies that underpin a more resilient food system,” said Shayna Harris, founder and managing partner, Supply Change Capital. “We invest through the lens of climate and culture, table stakes given the current existential crisis that our planet and society faces.”

“The food industry is responsible for a third of climate emissions,” Harris continued. “Multicultural citizens account for nearly all of U.S. population growth; by 2050 there will no longer be a ‘minority’ in the US. However, according to Pitchbook, 98 percent of venture capital dollars go to male founders while Diversity VC estimates that 70 percent of venture-backed founders are white, leaving the remaining population nearly untapped for early stage funding and creating a significant opportunity loss for further innovation.”

As Supply Change continues to pursue its mission to invest in the future of food, the firm announced it has closed its debut fund at $40 million, making it one of the largest Latina-led funds.

To-date the investment vehicle has deployed over $13 million across 15 early-stage food and agtech companies since June 2021 with the backing of limited partners including 301 INC, MassMutual through its First Fund Initiative, the Office of the Illinois Treasurer through the Illinois Growth and Innovation Fund, Bank of America, Illumen Capital’s Catalyst Fund, and J.P. Morgan Asset Management. 

“Supply Change Capital represents the future of food and the venture industry,” said Johnny Tran, managing director, 301 INC.

“As a leading investment firm in early stage food and agriculture technology companies, Supply Change Capital has a pulse on the cultural, demographic, and sustainability shifts needed to usher in the next wave of groundbreaking innovations for our industry.”

Noramay Cadena, founder and managing partner, Supply Change Capital, commented on the potential that Supply Change represents, stating, “From our intersectional set of investors to our robust portfolio, we’ve seated a venture firm platform that can endure and thrive. Ultimately, each LP, founder, and stakeholder in our community understands the same thing we do: we are on the precipice of a transformative change at the intersection of food, culture, and technology.”

“With 40 years of combined operating and investing experience, we’ll be the team leading investments through this evolution to a more inclusive and sustainable food system.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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