Mars Food closed the application process for its Seeds of Change accelerator on May 31, 2019, and it will soon start reviewing all applicants to eventually bring 12 startups to a pitch competition in Chicago on July 19 before choosing the final six companies to join its four-month program.
The accelerator, which the M&M’s maker launched at the Natural Products Expo West 2019 in March, is designed to help food startups “fast track growth and live their purpose to build a healthier and more sustainable future,” according to a prepared statement.
Mars said the search will focus on companies that share its values of “world flavors, plant-based eating, easy-meal solutions, responsible food and creating with care,” and the selected participants will cover areas, including innovative experiential offerings, new business models and emerging technology.
Gary Arora, global lead of open innovation at Launchpad for Mars, said: “We don’t really care if they’re super early-stage or mid-stage. We’re just very happy to have companies that are at different stages because the program is really going to be tailored based on what their biggest needs are,” noting that a brand new company, for example, is likely to primarily focus on packaging and storytelling, while a later-stage business will probably focus more on the right distribution partnerships.
Arora added that all participating startups will also have access to a panel of industry expert mentors, including Stephen Badger, chairman of the board for Mars; Rohan Oza, a brand builder who recently appeared on Shark Tank; and JKR, a design-led creative agency known for incubating notable startups.
Unlike many existing accelerators in the market that award a final grant to their winners, such as PepsiCo’s Nutrition Greenhouse and Kraft Heinz’s Springboard Incubator, Arora noted the grant structure of Seeds of Change is “based up front.”
“So every startup gets $25,000 right off the bat for accepting the program,” he explained, while the remaining $25,000 will be used to meet each company’s particular needs.
Finding trends in snacks and beverages
Although Seeds of Change will mainly support companies that can provide better meal solutions, Arora noted that many of these companies play in the snack and beverage categories, as they represent some of the most popular food trends, such as dairy-free or plant-based, frozen and low sugar.
According to a newly released report from Innova Market Insights, 39% of global consumers have followed a low-sugar diet in the past five years, compared with 34% among U.S. consumers.
Meanwhile, 67% of global consumers have reduced sugar intake or bought more reduced sugar products over the last year to be healthier, versus 63% among U.S. consumers.
The sugar reduction trend manifests itself the most in the Baby Boomer demographic, as they are “below-average purchasers of certain sweet products, such as chocolate, desserts, ice cream and snack bars,” Lu Ann Williams, director of innovation at the research firm, said.
“In contrast, they are markedly more important in the yogurt, sweet baked goods and breakfast cereal categories, so these could offer opportunities for sugar reduction,” she added.
Arora told me that the Mars team has seen several protein snack brands apply for Seeds of Change accelerator so far, including an African chips company that uses hemp as its protein source.
Prommus is one of the Seeds of Change Accelerator applicants.
PROMMUS
Other applicants include chickpea protein hummus maker Prommus, Latin-inspired organic food company Loisa Kitchen, as well as plant-based beverage producer Après.
Potential investment partnerships
Mars does not rule out the possibility of eventually partnering with one of the Seeds of Change accelerator participants upon its exit, according to Arora, although it is not the program’s initial objective.
The U.S. food giant previously bought a minority stake in KIND in 2017 with a goal to expand the snack bars maker’s global presence.
“There are investment opportunities down the road,” Arora said. “Having the accelerator as one of the ways to get to know entrepreneurs and their businesses is absolutely a very critical data point in making those [investment] decisions.
“It could be an ingredient company that is very complementary to our existing portfolio or a food tech [company] that could be applied to how we distribute our products,” he added.