Food power technologies have remained on the sidelines of investment, and for good reason, deemed too scientific, too slow to industrialize or too dependent on regulations, they have struggled to seduce traditional funds. The announcement of the first closing at 40 million euros from the second Nordic Foodtech VC fund, fund based in Helsinki and dedicated to Agri-Food Deeptech startups, testifies to a change in venture capital which rediscovers the strategic attraction of scientific foodtech. Nordic Foodtech VC aims for a closing of 80 million euros.
A sector long ignored by generalist venture capital
The Agri-Food sector, when it moves to food platforms or DNVB, is complex to address for investors. The projects combine long R&D, regulatory uncertainty, dependence on industrial and low margins infrastructure. As a result, the majority of funds turned to SaaS or B2C models with rapid return.
This disinterest has left a vacuum on the segment of food startups: precision fermentation, cell proteins, microbial crops, hyperspectral agricultural sensors, or even valuation of organic flows. In the absence of initiation funding, many innovations from the laboratories have never exceeded the stage of the Proof of Concept.
The entry of the institutional people changes the situation
Created in 2019, Nordic Foodtech VC is devoted exclusively to scientific solutions applied to the food chain. Its second vehicle, labeled SFDR Article 8, welcomes institutions such as Tesi (the Finnish sovereign fund) and Elo Mutual Pension Insurance Company, alongside industrial actors as Heino Group.
Innovations that stick to industry
The portfolio of the first fund has participations like ENIFER which develops fungal proteins from fermentation by-products or chromologics and its natural dyes produced by microorganisms. Melt & Marble is attacking fat structuring to replace tropical oils, Ironic Biotech transforms industrial waste into bioactive ingredients or Kuva Space uses hyperspectral satellite imagery to monitor agricultural conditions.
These startups do not seek to disrupt the agrifood solo but co-construct with the industrialists in place. The fund is targeting solutions to “critical business problems”, in the words of Lauri Reuter, another partner of Nordic Foodtech VC.
A favorable alignment: science, regulation, market
Several factors help to make the sector today more readable for investors:
- The technological maturity of many solutions from 10 to 15 years of applied research
- The evolution of European regulation on new foods, biomolecules or fermentation processes
- Increasing pressure on food security and resilience of post-Cavid and post-Ukraine value chains
A European dynamic to consolidate
In France, structures like Astanor Ventures, Blue Horizon or Foodlabs are also positioned on close logics. But the European ecosystem remains fragmented, very few funds have teams that are both scientific, regulatory and commercial capable of assessing these projects.
