Does the Future of Food Live in Better B2B Investment?

Although today’s food technology start up market remains hot, there have been murmurs of a potential food technology start up bubble – one of the most recent speculations from Mother Jones (https://t.co/4dqlTcsmYc).   Recent news around food delivery platforms, mobile ordering applications, and meal kit membership programs is even catching a fevered momentum with established, traditionally non-food industry companies such as The New York Times (https://t.co/1b1IDNQxYo), Amazon (http://read.bi/1WYbXE0), and Uber (http://bit.ly/1NUT03d).

Investment in the business to consumer (B2C) food technology space is clearly where the current growth and profits live – end users have a steady desire for real time access to food information and choices.  However, to influence real and scalable growth in our food chain – source to consumer – I believe we need to ask our food-tech focused Venture Capitalists a primary question:  what investments are being made in technology solutions in the business to business (B2B) space?  Or perhaps, more profitably, into the business to business to consumer (B2B2C) space?

We have seen some examples of such B2B investment recently in Agtech with the implementation of drones and GPS and materials-tracking technology to give farmers the big data, analytics and resource visibility needed for smarter farming.  A recent article from Farmlogs showcases this movement (http://bit.ly/1T6fSdf. )  I would love to see more financial investment in technologies that are focused on the sourcing of food, the recalling of food, and the ecommerce transactions around our food.  In order to see fundamental change in the future of food, the B2B innovators in food technology need our investment.

The Business of FoodTech: Eating Our Own Tail

Such buzz these days about Food Tech –  how mobile devices and delivery platforms and farming drones and food hubs will redefine how we eat, how we shop, how we farm and how we determine where to go to get our information about the food system…. It’s a lot of buzz.

Smarter professionals than me, focused exclusively on the comings and goings of the food technology universe will tell you we are in an unprecedented time of transition – led in large part by the application of technologies to redefine what we know about food.  These professionals are right.  We are all well served to follow and engage with the likes of Brita Rosenheim (@Baconista), Danielle Gould (@dhgisme, @foodtechconnect), Nina Meyers (@nina_meijers, @foodtechconnect), and Danielle Nierenberg (@DaniNierenberg, @Food_Tank) who make it a mission to stop and absorb the happenings in new world of Food Technology – and share them with us.

With over 20 years in high tech enterprise software, most of which has been focused on High Tech Supply Chain, I can tell you that technology – more specifically software – is only as good as the human beings using it.  Technology is simply a tool for addressing questions.   This, of course, means that food technology and the sector that seemingly has sprung up with a vengeance around us in the past five years, is only as good as the humans asking the questions they seek answers to.   I would further argue that the humans asking the questions they seek answers to are only as good as the very questions they are asking.

Can I get take-out delivered to my home while sitting on my couch, using my two thumbs on my mobile device?  Can vegetables grow upright, in a box, underground, on my counter in my kitchen?  Can I order my morning coffee from the back of the line and have it waiting for me when I reach the counter?  Are the drones flying overhead at industrial farms creating a perception that being a farmer is a profitable and viable career?   Can I pay for my meal by tapping a screen anchored to my table, to avoid waiting for the waitress to bring me the check?  Do eggs developed in a lab make my mayonnaise healthier?

I took a class in college called “War and Technology”.  This class had a cyclical mission – to explore how our human desire for war through the ages shaped the evolution of military technology – and how the evolution of military technology shaped our human desire to go to war.  It’s Ouroboros – or as Wikipedia puts it, “The Ouroboros often symbolizes  introspection, or cyclicality, especially in the sense of something constantly re-creating itself, the eternal return, and other things such as the Phoenix which operate in cycles that begin anew as soon as they end.”  The snake ate its tail for me for the first semester of my sophomore year, while I sat in silent horror at the nature of human existence.

Is the food technology space a novelty?  A harbinger?  An adaptation?  This space is as frustrating to me as it is fanciful.  I can only conclude that today’s state may very well be a wake-up call for us to see that we are eating our tails.  A call to stop looking at new food technology as leading “fundamental change” in this food system only to perpetuate the commercialization of said technology until something newer and shinier comes along.  Can we, as consumers, as technologists, as thought-leaders, as producers, as shepherds of the earth, begin to evaluate how we are leading the evolution of the technology and begin to ask better questions?

What say you, FoodieData thinkers?  What questions have you been asking?

The Food Industry’s Sharknado

A curious thing is happening, one can hardly believe it – in towns and major cities, impacting the lives of low wage workers and highly paid venture capitalists.  Sharks are flying through the air, swimming up flooded streets, popping out of drainage pipes, and landing on farms, technology innovation centers and supermarkets across the US, gobbling up and swallowing whole what we once took for granted.

I admit, I have been watching with big eyes from the window of my small suburban Boston neighborhood, sometimes with a Tara Reid like smirk, thinking, this too shall pass.  What I have come to marvel at, though, is what seems to be a perfect storm of paradigm shifts in numerous links within the food industry that seem to be churning all within the span of the last 9 months.

Exhibit A – a phenomenon striking close to home here in Boston:  The Hatfields and McCoys have finally brought their food empire to its knees.  I speak of course of the spiraling plummet of the goliath of New England supermarket chains, the king of discount shopping, Market Basket.  Competitor Stop & Shop has accelerated their online delivery service PeaPod to capitalize on Market Basket’s striking workers and empty shelves, with limited but sufficient success.  The PeaPod driver who delivered my order last night was called up from Connecticut for an extra shift, and was two hours past the guaranteed delivery window because, with three times the demand, Peapod inventory had to be sourced far and wide.  Customer service was quick to offer me $10 off my next order and free delivery for the rest of the month for the delay.   There is blood in Boston Harbor.

Exhibit B – The rise of food delivery startups, that cater to businesses in office parks, busy families, large parties, and now, foodies and those early adopters who expect food lifestyle services at the touch of their mobile device.  Formerly unknown companies like GrubHub, Instacart, Delivery.com, GoodEggs, Blue Apron, SpoonRocket and Caviar are all of a sudden the darlings of the investment and M&A world, being consumed, snapping up rounds of funding and securing news headlines from the likes of Huffington Post and Forbes.   They dive and circle to gorge themselves on the delivery trend first anchored by the likes of Amazon Fresh and FreshDirect.    Fresh food, even organic offerings, are now a commodity that sits on the shelf next to electronics, clothing and hardware at Walmart and Target stores – leaving consumers in the developed world expecting an “always on” capacity for their food desires.

This leads me to my final rumbling – and that of food sourcing platforms.  I have been following the spectacularly hard work of leaders like Provender, FoodTrade, Jackeez and AgLocal as they navigate the challenges of delivering on an efficient ecommerce platform that matches a food source directly with its demand point, to increase local availability, preserve and support small craft producers and accelerate adoption by food service professionals of sustainable, local, traceable product.  I am ready to observe a feeding frenzy in this space soon, followed by the strongest of the food beasties swimming back out into depths to feed again.