Who: Ascension Ventures, Big Society Capital and Mission Ventures
Start date: March 2020
End date: September 2021
Amount: £2.2 million including £1.5 million of investment funds
Supported through: childhood obesity programme
Good Food Fund is a new business accelerator and venture fund backing healthier food and drink brands to help tackle childhood obesity. The prototype fund will provide business support and allocate finances to start-ups and small and medium-sized enterprises (SMEs) committed to bringing healthier children’s brands to market and making healthier food products available to families on lower incomes.
This project is the culmination of a two-year partnership with the UK’s leading social impact investor, Big Society Capital. The business accelerator will be run by Mission Ventures and the Venture Capital Fund will be managed by Ascension Ventures.
After-school snacking for children will be a key focus, but we will also look for opportunities to market healthier drinks, ready meals and frozen food, fast food and takeaway, and school catering. Snacking brands will be supported to market to families in Lambeth and Southwark, testing demand for the products at an affordable and sustainable price.
If this pilot is successful, we aim to establish a multi-million pound fund providing brands with investment, market expertise, route to market support, and access to place-based infrastructure such as shared kitchen space.
Timings are subject to change depending on what adjustments are required in response to Covid-19. The first round of challenger brands have been selected.
March – April 2020
Applications to the Good Food Fund open.
May – June 2020
Workshops and 1-2-1 support sessions begin. Financial cost modelling scoped for each brand to understand how brands can sustainably reach an affordable price point for our target audience.
July – Aug 2020
Tests begin to understand whether families on lower income buy these products at a reduced price point.
Aug 2020 – Sept 2021
Regular communications with different stakeholders to evaluate the success of the project. Long-term evaluation to measure sales, brand recognition, costings, and disruption of food market. Decision made on whether to establish a bigger fund, with agreed scope and set of founding partners in place.
Calls for healthier start-ups and SMEs to participate in the business accelerator go live in March 2020, with brands receiving a fully funded package of business support from Mission Ventures. This will include a review of their current strategy and practices, and a plan for how products can be scaled to reach a sustainable price point that’s accessible to more families. Participants can also apply for financial support in the form of equity and debt from Good Food Fund.
Ascension Ventures will manage the investments for businesses that have gone through the Accelerator, as well as other viable food start-ups keen to reduce overheads and lower their prices. Investments will be tailored to the scale and needs of each brand.
As well as supporting businesses directly, all partners will collaborate to influence the key stakeholders that new brands rely on. Over the next 18 months, we will be engaging large FMCG companies, retailers, investors and policy makers to understand how we can work collaboratively to tackle the flood of unhealthy food currently faced by families on low incomes.
All children should be able to access healthy food, no matter where they live. Families want affordable, tasty, convenient and healthier food, but the current market only caters for cheap options that are unhealthy. We want to transform the options available to families by disrupting the food market and supporting healthier, affordable brands.
New brands coming to market are at a significant disadvantage. They struggle to compete with large corporates who operate with huge economies of scale and at lower cost. In order to cover their costs, healthier brands typically need to focus on customers who can pay a premium, so prices stay high and marketing focuses on audiences with higher incomes. To make healthier options available to everyone, we need to understand how these brands can bring their costs down, so that prices can be lower, and how these brands can market effectively to families on lower incomes.
By building this understanding, and by growing a portfolio of successful new brands, we aim to disrupt the existing food market. We plan to demonstrate to retailers, corporates and investors that there is financial as well as ethical incentive for supporting healthier brands. We also plan to show policy makers that serving healthy products cost effectively is possible, supporting the case for progressive regulation.
Ascension Ventures is an early-stage venture capitalist built by successful business owners to back the next generation of tech and impact entrepreneurs. Since 2015, Ascension has invested in over 80start-ups and their specialist approach and extensive sector reach allows them to identify and scale pioneering tech enterprises. Its Fair By Design Fund focuses on reducing the poverty premium in the UK – the extra money families on lower incomes have to pay for essential goods.
Big Society Capital is the UK’s leading social impact investor, whose mission is to unite capital, expertise and ideas for better lives. Working with expert partners, they seek to understand people’s needs first. Then, using their knowledge and capital, they collaborate and invest with fund managers who also want to create a better, sustainable future.
Mission Ventures, previously named Grocery Accelerator, is helping to transform the food industry one challenger brand at a time. Three proven entrepreneurs, who have each disrupted grocery categories, have learned from their successes as well as their failures and are now sharing their experience and expertise with founders.
Project outcomes are being measured by an external evaluation partner, to capture data from all stakeholders and gauge how viable supported brands are long term. We are using both quantitative consumer and sales data, as well as qualitative data from businesses and influencers to assess whether we have successfully begun to disrupt the market.
We will focus on answering a number of questions, including:
Specific outcomes to be tracked will include:
Portfolio Manager: Matt Towner