Big is not beautiful when it comes to future businesses, according to American tech research company Lux Research.
It has named what it sees as the top 32 food and agriculture startups of 2020.
In recent years, the majority of growth in the food and beverage industry has gone to companies outside the top 20 players, it says.
With smaller and more agile brands capitalising on the demand for personalised products and rapidly shifting consumer behaviour, they also better connected farm to fork potential.
Lux’s food and agriculture experts continuously monitor and evaluate these and other industry megatrends and events to target and analyze promising startups capable of capturing the opportunities created.
These startups are evaluated on their technology, business strategy, leadership, and market positioning, and those companies awarded a “Lux Positive” or “Lux Strong Positive” rating were published in Lux’s market map “Top Food and Agriculture Startups of 2020”.
“Numerous challenges, from climate to Covid to human migration, aligned in 2020 to stifle growth across food and agriculture, laying bare technology, food, and health system weaknesses,” said Josh Haslun, Senior Analyst at Lux Research.
“These vivid impacts are not without opportunity, even as the lines across value chains blur.
“Picking the right startups and partners to remain ahead in this dynamic period is critical, and Lux’s methodology and expert knowledge achieve that outcome.”
The startups are categorised into four key trends the agrifood industry should be tracking:
n The Food Company of 2050 – Major food companies face intense competition from smaller, more agile brands. With personalisation in focus, there are fewer benefits to being big; innovating at an increasingly granular, regiospecific level to address changing consumer demands will be key.
n Doing More with Less – Companies whose businesses rely on consumption for top-line growth – from foods to agrichemicals – face pressure to diversify. Meanwhile, producers are reducing resource use, driven by concerns of affordability and scarcity.
n Transformative Innovations Disrupt the Entire Ecosystem – Major transformative innovations underlie the products and services that drive consumer markets; innovations in bioinformatics, POU sensing, and ingredient informatics are disrupting the space to reduce the cost of and resource investment in discovery.
n Consumers’ relationships with health are evolving toward prevention and personalization – Prevention and personalisation are reshaping consumers’ choices, empowering them to make lifestyle decisions that explicitly influence health outcomes. This will drive massive market potential.
“Doing more with less and transformative innovations were the most highly populated of the four trends and highly focused on agricultural solutions, indicating both the need and overall readiness to transition the value of innovative solutions to the food system,” continued Mr Haslun.
“This is not to say that the momentum towards the food company of 2050 or consumers’ relationships with health trends are underdeveloped.
“In fact, the strong presence of key ingredient developers and emerging presence of health IoT and personalised nutrition solutions are synonymous with momentum across food and agriculture.
“The collective result presents well the leading areas to engage and the types of players to interact with in 2021 as these trends continue forward.”