- General Mills' 301 Inc., the company's VC unit, is keeping busy. 301 Inc. announced Tuesday it invested in startup cottage cheese producer Good Culture's latest $2.1 million funding round.
- Good Culture sells high-protein, low-sugar cottage cheese in savory and sweet flavors in several retailers. According to a study conducted by Grand View Research, Inc. the global protein ingredients market is expected to grow to $33.91 billion by 2020.
- General Mills' VC sector has also invested in plant-based manufacturer Beyond Meat and superfood snack maker Rhythm Superfoods.
Startups and mid-level companies are often better at keeping up with trends than larger manufacturers — hence the M&A frenzy in the industry (in addition to gobbling up each other). The food subsector saw a 57.8% increase over 2014 for a total of $120.8 billion in M&A deals last year.
"Food and beverage [is] a lot more ripe for innovation, and you can get those really unique, high-growth companies, whereas there's not as many ways to reinvent the restaurant or retail experience," Anthony Valentino, deputy editor at Mergermarket, recently told Food Dive.
The 301 Inc. strategy is shifting toward smaller, more nimble startups. In some instances, the company may broker deals that would have the company outright purchasing the startup. If Good Culture proves successful, that's a route General Mills might take.
Still, food and beverage startups face an increasingly crowded and competitive industry, and simply keeping up with a trend won't cut it. Startups like Good Culture have to stand out if they want to make a dent in the marketplace.