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Hatching new ideas – Big Food’s incubator and accelerator programmes

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As with in-house venture capital funds, for big food companies looking to gain exposure to new, exciting, potentially faster-growing categories, starting an incubator or accelerator is becoming increasingly popular.

Incubators and accelerators are not exactly the same thing. Although both offer support and guidance to start-ups, incubators are typically targeted at companies at an earlier stage. Accelerators are aimed at existing companies that have an idea and a business model already in place but which need help to propel their business forward.

Such vehicles, and especially incubators, provide mentoring and advice on everything from branding to attracting finance. There is also often a grant provided to the businesses chosen to take part in a programme and sometimes a cash prize for the business selected as the 'winner' from that year's intake.

But it is not pure altruism on the part of the food businesses. They get to work with, learn from and build relationships with some of the most interesting young challenger brands that are disrupting the market.

They may even have first option on taking an equity stake in the businesses in the future. The ability to sell an equity stake may even be built into the programme's make-up.

It's an alternative, and certainly cheaper way, of tapping into the likely trends of the food market of the future than investing. Start-ups often don't fulfil their early promise. An incubator allows the company running it to identify the likely winners and losers.

Here we look at some of the key incubators and accelerators tapping into food sector start-ups.

PepsiCo

PepsiCo’s accelerator initiatives have spanned the globe.

In Europe, the global food and beverage giant launched its Nutrition Greenhouse incubator programme in 2017, which continued into 2018.

The company started a version of the programme in North America in the autumn of 2018 and, in 2023, launched a sustainability-focused accelerator in Asia Pacific.

Both initiatives, designed to discover and nurture breakthrough brands in the sector, saw companies receive grants and work with PepsiCo for six months. At the end of the period, one company was to be awarded further funding (EUR100,000 in Europe and US$100,000 in North America).

Erbology, a UK plant-based foods producer, won the first-year programme in Europe. Hapi Drinks, a manufacturer of sugar-free kid's drinks, won the first edition of the North America Greenhouse programme in 2019.

In April 2023, PepsiCo launched its first Hispanic-focused edition of the Greenhouse Accelerator programme. The Juntos Crecemos edition was focused on backing Hispanic-owned emerging food and beverage brands. The accelerator returned with another call for participants in March 2024.