With 9.5 billion euros injected into European food tech start-ups in 2021, i.e. three times more than the previous year, the sector is doing well. DigitalFoodLab, in partnership with Nestlé and Pinduoduo, published on March 29, 2022 the 5th edition of its annual report on the state of Food tech in Europe. A booming sector.
13 unicorns in Europe
A total of 3,540 start-ups are listed, of which 48% have raised funds since their creation. Since 2017, the number of active start-ups has grown at an almost constant rate of 8%. Investments of more than one million euros increased by 59% in 2021, whereas they were constant over the years 2019 and 2020. For DigitalFoodLab, this data is a good barometer of the health of the ecosystem which shows that the sector continues to grow in size.
13 Food tech unicorns in Europe have been identified, i.e. twice as many as at the start of 2021, and 7 of them have obtained this status in 2021. Start-ups such as Gorillas have reached this status. , Flink, Infarm or Swile. DigitalFoodLab adds that it has identified 10 to 20 start-ups that can become unicorns in the next two years (like Mathem, Ynsect or Zapp). Note the two IPOs of Deliveroo and Oatly. As well as the “exits” of two other promising start-ups which have seen a majority shareholder take control (Glovo and Wolt).
Food tech is driven by delivery
A total of 6 sectors are identified: AgTech, delivery, Food Science, Supply Chain, Food services and Consumer Tech. But Food Tech is very largely driven by the delivery of groceries and meals, which accounts for 67% of the amounts raised in the sector. The past year has seen the development of many start-ups in quick commerce, or ultra-fast delivery of shopping at home, which have raised considerable sums. For example, the German start-up Gorillas has already received 1.2 billion euros despite being founded in 2020.
Beyond delivery, the study highlights “sustained growth in the amounts invested in transformation”. In concrete terms, new food products are attracting more and more investors, such as research into alternatives to proteins. And pet food could also become an important market for start-ups revolving around the use of insects.
Similarly, investments in urban farms are increasing, whereas this sector was non-existent a few years ago. However, other sectors, such as agricultural robotics, are still struggling to attract investors.
France, a unique ecosystem
Unlike Germany and the United Kingdom, largely driven by start-ups in delivery, France has an ecosystem focused on other concerns. AgTech seems particularly attractive and more particularly research around the use of insects in animal feed since three of the leaders are French. Similarly, DigitalFoodLab notes “very strong investments in the digitization of payment in restaurants with ‘quasi-fintech’ start-ups such as Swile and Sunday.”
On the delivery side, the study notes the raising of 40 and 25 million euros from Cajoo and la Belle Vie. But “Investments in virtual restaurants (Not So Dark, Taster, etc.) explain the growth in delivery”slides DigitalFoodLab.
Germany, by far in the lead
At the level of the global ecosystem, European food tech monopolizes 20% of the funds raised (compared to 12% the previous year). Within Europe, some countries stand out clearly since 53% of investments are made in Germany, the United Kingdom and France. Germany is well ahead (31%). The United Kingdom (12%), France (10%) and the Netherlands (9%) follow. Beyond the countries, a dozen cities seem particularly attractive since they attract 75% of investments: Berlin, London, Stockholm, Paris, Amsterdam, Copenhagen, Helsinki, Dublin, Tallinn and Barcelona.