- Archer Daniels Midland’s venture capital arm ADM Ventures invested in Seventure’s Health For Life Capital Fund II, a venture capital fund dedicated to health, nutrition, microbiota and digital health. Financial terms of the investment were not disclosed.
- The company said this investment aligns with its strategy to develop functional ingredients for food and beverage applications in nutrition and wellness solutions that also contribute to preventative health.
- Functional ingredients have been gaining ground for several years. ADM's research demonstrates the pandemic has led to shifting consumer behavior, driving interest in foods that benefit their immunity, metabolism and mental states.
Consumers are increasingly interested in the connection between gut health and immunity. What began with lactobacillus in yogurt has spread into an array of functional probiotic and prebiotic strains that consumers are interested in introducing into their diets to support immunity, gastrointestinal health, their metabolism and even oral health.
Scientific research on the gut microbiota has dramatically expanded over the past two decades. While the science to decode the microbiome is still developing, it is thought to have a significant impact on health, influencing everything from obesity and digestive issues to food allergies and even cancer.
With such accolades associated with these bacteria, it is no surprise that consumers are interested in integrating more of them into their diets, especially as everyone is enduring the health consequences of a global pandemic. COVID-19 has thrown the relationship between gut health and immunity into sharp relief, and ADM's recent research found 57% of global consumers are more concerned about their immunity due to the pandemic. As a result of this spike in interest, three in 10 people are looking for and purchasing items that are tailored to helping improve specific health and wellness issues. And 48% say they will purchase more items related to health and wellness.
This new partnership with Seventure’s Health For Life Capital fund will offer ADM access to a menu of startup companies that are digging into the questions of medical therapy through nutrition that the ingredients giant can then leverage to bulk up its own portfolio of offerings through future investments and acquisitions. Rather than investing into the R&D itself, ADM is taking a popular approach with larger manufacturers and putting funds toward the expertise of smaller firms, being in place to integrate solutions they develop into its arsenal quickly.
ADM has long leaned on partnerships to incorporate trendy ingredients into its portfolio. Over the last several years, the company has teamed up with Perfect Day — which produces casein and whey through microbial fermentation to create animal-free dairy — and natural sweetener specialist GLG Life Tech Corporation.
Stepping into the competitive environment of ingredients aimed at improving the gut biome is likely to be a beneficial but demanding undertaking for ADM. According to Grand View Research, The global probiotics market is projected to reach $77.09 billion by 2025 from $44.2 billion in 2019.
ADM has worked to keep pace with this growth through acquisitions. In 2022, the company hopes to begin production at a probiotics production facility in Valencia, Spain. In its own portfolio, the company boasts a host of bacteria strains aimed at promoting different facets of overall individual health through supporting the gut microbiome.
However, the company is not alone in this pursuit. In 2017, DuPont Nutrition & Health established a partnership with the APC Microbiome Institute in Ireland to create products that help establish a healthy microbiome for infants. Danone, which has tapped into probiotics with its Activia yogurt, has contributed educational grants and fellowships to support research into the microbiome. And Nestlé plans to increase its nutritional solutions that promote health and well-being through a partnership with the Center for Microbiome Innovation at the University of California San Diego.
With health and wellness blending ever more seamlessly into food and beverage, the lines between food and function are bound to continue blending. By investing in a firm that specializes in the trendy segments of nutritional wellness, ADM is setting itself up to capitalize on the growing demand for food as a functional solution for a variety of ailments.