By Lynda Kiernan
Belgium-based Lotus Bakeries, owner of the Nakd snack bar and BEAR snacks brands, is launching FF2032 (Fast Forward 2032), an incubator fund to invest in emerging U.S. and EU-based brands and growth companies offering “innovative products, technologies, or market approaches within the food sector”.
The naming of the fund is reflective of 2032 being Lotus Bakeries’ centenary, and to convey the fund’s long-term investment commitment.
Today, the launching of a venture capital unit or incubator is standard protocol by some of the world’s largest CPG companies looking to gain relevance with today’s consumers and a share of the rapidly shifting food and beverage markets. General Mills, Danone, PepsiCo, Kellogg’s, and Campbell Soup are just a sampling of companies to have done so, while Hershey’s venture unit C7 Ventures announced two investments just last week.
However, names that might not be as globally recognized have been following suit, with Mexican baked goods group, Grupo Bimbo launching Bimbo Ventures in July 2017, Chobani launching an incubator in Australia in August 2017 to mirror its existing fund in the U.S., and Italian pasta brand Barilla launching its hybrid venture capital fund and innovation hub Blu1877 in November 2017.
FF2032 will acquire minority stakes in companies focused on “contemporary consumer demands” in the categories of nutrition and convenience, with investments through the fund totaling EUR30 million (US$33.3 million). Lotus will provide each company with supportive financial and strategic input, to help them accelerate their growth trajectory, and in certain instances, may fully acquire selected companies.
In return, Lotus said that the companies in its FF2032 portfolio will offer inspiration through their “entrepreneurship, their technology, their speed and agility, passion, and their innovations”.
“I believe very strongly in this collaborative model and the mutual cross-fertilization which can take place with promising young businesses and equally so business cultures,” said Jan Boone, CEO Lotus Bakeries.
The launch of this incubator comes as Lotus reveals strong results and growth. In the first half of 2019, the group’s consolidated turnover climbed by EUR 30.6 million (US$34 million) to reach EUR 298.1 million (US$331.3 million), reflecting growth of 11.5 percent.
The company states in a recent release that the bulk of this increase was due to the internationalization of Lotus Biscoff, Lotus Biscoff Spread, and Lotus Biscoff Ice Cream, with the most marked growth occurring in the U.S., UK, and France, and solid growth happening in the Middle East, China, Korea, Spain, the Czech Republic, and Switzerland.
However, Lotus also saw growth from its Natural Foods business, with Nakd, BEAR and Kiddylicious brands doing well in international penetration and turnover, especially in the U.S.
In support of the continuation of these trends, in June of this year, (only 14 months after Lotus agreed to acquire the BEAR production activities from its previous manufacturer, Grassroots) Lotus announced the acquisition and opening of its new BEAR factor in Wolseley, South Africa.
Only weeks later, Lotus then opened its new Lotus Biscoff manufacturing facility in the U.S. with an initial two production lines and two shifts, which the company states it plans to increase to three shifts by the end of this year.
During these significant moves, FF2032 made its first acquisition in July of this year, acquiring a 20 percent stake in UK-based producer of sourdough crispbreads, Peter’s Yard. Made from all natural ingredients, crispbreads are crackers to be eaten as a snack, or as toast, and are a healthy alternative to bread.
“…we have achieved two major milestones in the form of two new factories on two new continents,” said Boone. “The different teams have worked extremely hard to achieve this, which therefore brings great satisfaction.”
Boone continued, “I am also very enthusiastic about the establishment of FF2032 and the resources we will be able to allocate to this in the coming years. This is a perfect fit for our long-term vision and philosophy. I am very much looking forward to supporting our first investment, Peter’s Yard, on its growth path, together with the founders.”