Five Seasons Ventures Raises €180M for Food Tech Innovation

European Food Tech Investment Surges

The food technology sector in Europe is currently experiencing substantial growth and a period of rapid expansion. Investment in European food tech businesses reached €3 billion in 2020 (according to the State of European Tech Report, March 2021). This growth was further accelerated by the pandemic, as consumer behavior shifted towards grocery delivery services.

The emergence of direct-to-consumer food brands has also significantly impacted the industry landscape. Furthermore, heightened consumer interest in healthy food and nutrition, driven by a desire to bolster immunity during the COVID-19 pandemic, contributed to this positive trend.

Five Seasons Ventures Announces New Fund

Reflecting this dynamic market, European venture capital firm Five Seasons Ventures has announced the final closing of its second fund, totaling €180 million. This represents a considerable increase from their initial fund of €77 million, demonstrating the escalating investment activity within the food tech space.

The firm intends to continue making Series A and B investments in European food tech companies. A key focus will be on rapidly expanding, consumer-facing food businesses that demonstrate a measurable positive environmental or social impact.

Portfolio Performance and Growth

Five Seasons Ventures aims to demonstrate that food tech startups can achieve growth rates comparable to those of traditional technology companies. Their Fund I portfolio is projected to generate a combined revenue exceeding €350 million in 2021.

For example, portfolio company Air Up has achieved a revenue run rate of €100 million in under two years. Air Up specializes in a reusable, smart water bottle that delivers flavor through retro-nasal scent technology.

Industry Perspectives and Investment Strategy

Ivan Farneti, a co-founding partner at Five Seasons Ventures, stated: “The current boom in European food tech is undeniable. We were the first VC firm to specialize in food tech within Europe in 2018, and we believe our efforts have helped establish it as a compelling investment area.”

He further noted that Fund II was quickly oversubscribed, indicating strong investor demand for exposure to European food tech, driven by the potential for both high growth and positive impact.

Portfolio Companies and Team Expansion

Five Seasons has previously invested in companies like Butternut Box, a direct-to-consumer provider of fresh dog food in Europe, and THIS, a producer of plant-based meat alternatives. The firm’s team has expanded to nine members with the addition of a Head of Impact and Sustainable Investing.

Recent investments from Fund II include her1, a company focused on female wellness supplements, and vly, which utilizes peas to create a protein-rich, plant-based milk alternative. Investments have also been made in Barkyn and The Nu Company.

Geographic Reach and Future Outlook

To date, Five Seasons Ventures has supported 14 companies operating across six European countries: Germany, France, Italy, Portugal, Switzerland, and the U.K.

Niccolo Manzoni, also a co-founding partner, highlighted the significant growth in capital allocated to food tech ventures, increasing from €1 billion to €3 billion in Europe over the past two years. He anticipates this trend will continue, fueled by companies that have successfully raised capital and experienced rapid growth.

Manzoni emphasized the impact-driven nature of their investments, stating: “Two of the most critical global challenges are human health and climate change. We specifically target companies addressing these issues. Our portfolio companies collectively prevented approximately 2 million kilograms of food waste last year, and their products are designed to enhance health and well-being.”

He concluded by noting the unique opportunities within food tech, stating that certain advancements are not readily achievable in other sectors like Software as a Service (SaaS).