Tyson Foods has created a $150 million venture capital fund that will partner with start-up food companies to support new technologies, products and business models for food production.
Based in Chicago, Tyson New Ventures will focus on alternative proteins, commercial models that reduce food waste and new technologies.
“We believe that we can accelerate the growth of startups through our capabilities in such areas as food and culinary research and development, sourcing, insights, customer relationships and distribution,” said Monica McGurk, Tyson’s executive vice president of strategy and new ventures, in a statement.
“This fund is about broadening our exposure to innovative, new forms of protein and ways of producing food, while remaining focused on our core fresh meats, poultry and prepared foods businesses.”
Deal structures will include minority equity investments, commercial joint development, licensing and supply agreements, according to the LinkedIn profile of vice president and general manager Mary Kay James, who recently joined Tyson from Dupont Ventures, where she oversaw investments in agriculture, nutrition and health.
In an email to Agri Investor, Tyson senior director of public relations Gary Mickelson added that because over $160 billion in food is wasted every year in the US, Tyson New Ventures will look for opportunities to partner with manufacturers, distributors and food service operators throughout its supply chain to find ways to tap into that resource.
Mickelson wrote that while Tyson New Ventures’ exploration of opportunities related to food waste is in its early days, the company hopes to find business models to “create social goodwill, connect hungry people with food and generate profits”.
Tyson is following the lead of other large industry peers who are supporting early-stage food ventures, including Campbell’s Soup, Kellogg’s and General Mills, which have all established similar vehicles.
General Mills’ venture arm, 301 INC, was an investor in Beyond Meat, a plant-based proteins producer which Tyson also purchased a 5 percent stake in this October and represented the new fund’s first investment.
At Rabobank’s Markets Forum last week in New York, head of mergers and acquisitions Donald Meltzer predicted that innovative companies with $5 million to $10 million in revenue, such as those likely to be targeted Tyson New Ventures, would prove attractive acquisition targets for larger industry players as they adjust to changing consumer expectations.