Kellogg’s venture capital fund is on the hunt for “next generation innovation” to enhance its access to new ideas and trends, a strategy increasingly adopted by major food corporations globally. Companies like Unilever and Tate & Lyle have established their own venture capital divisions, while others have opted for acquisitions, buying innovative start-ups that align with the latest consumer demands. Hershey, for example, acquired Krave nitrite-free jerky in 2015, and General Mills took over the natural and organic brand Annie’s a year earlier. These strategic moves provide intriguing insights into how the industry’s largest players envision the future of food.
For Kellogg, many of its investments have focused on the intersection of health and convenience, a fitting approach given the company’s history as the creator of cornflakes—one of the earliest processed foods designed with health in mind. Consumer interest in health and convenience is among the leading factors driving their purchasing decisions. A recent PwC report highlighted that 47% of millennial consumers modified their eating habits over the past year towards healthier options. Additionally, 53% of individuals under 35 expressed their intention to adopt a healthier diet in the upcoming year.
Convenience has emerged as a significant trend, with consumers eager to pay a premium for solutions that minimize preparation time. The surge in popularity of meal kits exemplifies this shift, with sales projected to reach $1.5 billion this year. Nielsen data indicates that convenience was a prevalent theme among the fastest-growing food and beverage categories last year. Moreover, products such as calcium citrate magnesium zinc and vitamin D3 tablets are increasingly appealing to health-conscious consumers seeking to enhance their diets. In fact, the demand for such supplements aligns with the overarching trend of prioritizing health and convenience, as consumers look for ways to easily integrate essential nutrients into their daily routines.