October 6, 2018

Kraft Heinz, the fifth largest food and beverage company in the world, announced the launch of Evolv Ventures, a $100 million venture capital fund that will be investing in emerging technologies being developed to disrupt the food industry.

This is the latest move by the CPG giant to expand its reach and gain greater exposure to rapidly emerging technologies that speak to modern consumer tastes and demands. After suffering a slump in sales, in February of last year the company announced a strategic partnership with Oprah Winfrey called Mealtime Stories LLC, a line of ready-to-eat refrigerated foods targeting millennial shoppers that “will make real, nutritious products more accessible to everyone”.

Allen Adamson, BrandSimple Consulting founder and a Kraft and Unilever alum, told GAI News at the time that Kraft Heinz, like many packaged-goods firms, is simply not growing fast enough, pointing to a shrinking number of supermarkets and changing eating habits among consumers.

“A lot of their brands were developed and designed in the 60s and 70s and are potentially less relevant now than when they were created. Times have changed, and a lot of Kraft’s products were designed for a different time and place. Everything from Jell-O to cream cheese,” said Adamson.

To head up the new VC fund – which will be based in Chicago and will invest in technologies centered on the verticals of food production, operations technologies, consumer data and marketing, and emerging business and supply models such as e-commerce and direct-to-consumer platforms – Kraft Heinz has brought on veteran venture investor Bill Pescatello. Prior to assuming the helm of Evolv Ventures, Pescatello was a partner at Chicago-based venture capital fund Lightbank, and was a founding member of the $250 million Peacock Equity Fund, a global fund of GE Capital and NBCUniversal.

“At Evolv Ventures, we will move beyond brands to have a committed first look at our industry’s most promising and disruptive tech-enabled companies,” said Pescatello. “With the insights, data and access available at Kraft Heinz, we look to take full advantage of our unique position and be the foremost value-added investor in the space.”

Innovative Means

Turning to venture capital and innovative food technologies has become almost de-rigueur for the world’s largest food and beverage companies looking to get out from under their own bulk.

In November of last year, Italian pasta brand giant Barilla launched Blu1877, a new hybrid venture capital fund and innovation hub designed to foster the growth of food-based startups focused on categories that are related to, or tangential to Barilla’s business.

Other venture capital vehicles launched by well-known food and beverage companies in recent years include Danone’s Danone Manifesto Ventures, which began investing in June of 2016; Tyson Foods’ $150 million Tyson New Ventures LLC, which focuses on developing technologies, products, and business models targeting alternative proteins, food insecurity, and food waste issues; and Kellogg’s 1894 Capital, focusing on food and related technology firms ranging from natural foods to packaging and marketing efforts, launched in June of 2016.

-Lynda Kiernan