US – SnackFutures, Mondelez International’s innovation and venture hub, has launched a new program dubbed CoLab to help accelerate innovative early-stage snack brands.
According to a statement from SnackFutures, the 12-week program is customized to each participant’s business challenges and growth priorities. Up to 10 startups will be chosen to participate and receive a US$20,000 grant.
Additionally, Mondelez will provide the businesses with tools, technologies and access to networks and industry expertise, while the large CPG gains insights, capabilities and prospective investment opportunities.
Mondelez, the snacking giant known for iconic brands such as Oreo, Ritz and Triscuit, has been aggressively bulking up its portfolio through acquisitions and by launching or making minority investments in startup brands.
Its venture arm- Snack Futures- has been critical in this acquisitions while at the same time giving the confection giant a chance to learn from some of the most promising up-and-coming brands in food and beverage.
Since its creation in 2018, SnackFutures has created and launched five brands in the U.S. and Europe: CaPao, Dirt Kitchen Snacks, Millie Gram, NoCOé, and Ruckus and Co. It also has made minority investments in Uplift Food, Torr and Hu.
Mondelez is now taking its snacking prowess a step further with CoLab by focusing on established companies that fit into its growth strategy.
Businesses must generate at least US$500,000 in revenue, have high growth potential and align with Mondelez’s innovation priorities, the snack company said.
SnackFuture’s unique position
“SnackFutures is in a unique position of both creating our own brands and investing in startups, so we can offer participants empathy and understanding from our own experiences along with the rigor, discipline and insights of a global snacking leader,” Brigette Wolf, global head of SnackFutures at Mondelez, said in a statement.
“It’s even more important for programs like CoLab now as these small brands try to recover and grow out of the challenges presented by the COVID-19 pandemic.”
Venture arms critical to CPG growth
While large CPGs are good at innovating and evolving their existing portfolio of brands, startups are often more knowledgeable about food trends and are able to pivot faster, incorporating changing consumers preferences into their offerings.
It’s a big reason why nearly every large food company, including Danone, PepsiCo, Nestlé and General Mills, have developed a venture capital arm or worked with an organization that helps young and trendy startups grow.
Such investments give big players like Mondelez an intimate look into the young upstart, and an opportunity to later buy the small business if it succeeds. If both parties are familiar with each other, it can be a largely seamless transaction.
For smaller firms, a big company can provide them with resources, mentoring, funding and connections that they may not have had access to on their own, or taken longer or more money to establish.
Mondelez has little to lose in starting CoLab. At worst, it sacrifices time and some money working with these young companies. But the potential to gain knowledge or a business to invest in or purchase outright is worth the risk.
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