As supply chains face mounting volatility, industry leaders argue the only path forward is a shared ecosystem – one where startups, corporates, investors and farmers co‑invest in the future of food.
Closer stakeholder collaboration to offset low capital availability was a key discussion point across food innovation and sustainability during Future Food-Tech San Francisco last month.
From scaling precision fermentation with the right partners to sturdier offtake agreements with buyers, companies are looking at new ways to build resilience in their supply chains – particularly with commodities.
Shortages in high-demand commodities like cocoa, coffee, vanilla and citrus, among others, faced brutal shortages and caused pressure from farm to shelf. Multinational CPGs like Nestle, Mondelez International and The Hershey Co banded together to launch TogetherCocoa to support cocoa farmers and strengthen the global supply chain. Cell-cultured, albeit still challenging to scale for a global market, offers another potential alternative to the cocoa shortage with companies like Kokomodo focusing on climate-proofing supply. While other brands pursue cocoa extenders like malted barley flour or cocoa replacers.
But ultimately, the question remains: How can the industry future-proof supply?
It starts with the soil and understanding farmers’ experiences from a local level, emphasized Amanda Davies, Global VP of R&D, sustainability and commercial, Mars Snacking.
“We have to stop thinking that things are going to be available when we want them, and start thinking about generational resilience,” she said, adding that the term “commodities” should change and reflect sustainable processes.
“We feed the world off four crops. This is not resilient,” echoed Ian Roberts, CTO, Bühler.
Even for biotech companies like Celeste Bio, which produces cell-cultivated cocoa, agriculture and technology are intertwined.
“It shouldn’t be agriculture or technology. It should be agriculture and technology,” said Hanne Volpin, CEO, Celeste Bio. “So we can create more resilience, more stability, more planability.”
Merging these two sectors together offers a stronger supply chain and more versatile applications, echoed Kris Latt, president, sustainable materials and strategic initiatives, ADM.
“We’re bridging biology and engineering together” by “creating ingredients in a more sustainable, clean, efficient manner,” from renewable and sustainable processes, he said.
Collaboration models between startups and corporations
Even multinationals with a larger supply chain are vulnerable to external factors impacting commodity availability and pricing. Startups, despite having limited resources, have the advantage of maintaining flexibility.
When corporations and startups decide to collaborate, Lutt emphasizes three criteria: “Is it practical? Is it scalable? Is it profitable?”
While many startups come with innovative technologies, sometimes the problem they are addressing is not an actual market need, explained Roberts.
“There are brilliant ideas to problems that I’m not sure society sees as problems,” he said.
Partnership readiness is just as important as product readiness.
Corporations evaluating startups may be impressed by the technology, but if they don’t deliver a realistic solution – or if startups are not structurally ready for a corporate partnership due to unprotected IP, unclear processes and cultural mismatches – the partnership can fail, Roberts added.
On the flip side, corporations should evaluate their own hindrances to a partnership. Sometimes they slow processes down, impose unnecessary bureaucracy or don’t fit culturally with the startup.
“We need to understand when we are great and distill that,” Roberts said.
Challenges to strengthening supply
Raising and spending capital efficiently will always be a challenge for companies regardless of size – and no single player can shoulder the cost or risk of shifting the food system alone.
Davies argued that transformation in the food system requires longer time horizons, capital that tolerates slower returns and investment aligned with systemic change instead of quick wins. This “patient capital” Davies describes reframes capital as a shared resource to progress and sustain long-term success across the supply chain, not individual company wins.
But capital alone isn’t the limiting factor – a lack of integration in the supply chain is, Roberts said. Startups don’t just need money, they need market access supported by stakeholders (i.e. corporations, retailers, investors and regulatory, among others).
Shared infrastructure can help de-risk partnerships and business, he argued. Startups building their own pilot plants, for example, funnels venture capital into duplicative infrastructure that can’t be scaled alone, ultimately prolonging timelines and increasing collective risk, he said.
One solution is sharing capital, facilities, capabilities and risk, he explained.
“One hundred good companies all investing $20-30 million to build the same pilot plant is a waste of cash. … What if we de-risk by providing shared scale up capacity, competence – not just steel and glass?” Roberts said.
Regulatory efficiency is another pain point – even for larger companies.
“How fast can you get the permitting done? How fast can you get the FDA to establish names? The regulatory side always seems to be what slows us down,” Lutt said.
As food tech advances, regulatory bodies could update their practices with a more “entrepreneurial eye” and enable “controlled, intelligent experiments that could allow us to build a more sustainable food system,” Roberts added.
