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Articles
For Founders: Seize this Moment to Raise Capital
By Bunmi Olayanju MBA CFA
While the headlines have been awash with talk of a venture capital winter, it’s crucial to understand that it’s merely a season, not a barren period. The data shows that while the pace of fundraising might have decelerated in the past year and a half, there’s still a robust ecosystem of deals being struck across stages. For founders who can present their businesses credibly and compellingly, now could be an opportune time to secure the capital they need.
Let’s delve into why the current fundraising climate holds promise:
Abundance of Dry Powder: Latest data from Q1 2023 shows VC firms in the U.S. sitting on a staggering $303B in uninvested capital, a figure nearly double that of pre-pandemic levels. This reservoir indicates there’s ample capital seeking worthy ventures.
Momentum-driven Investments: After a period of caution, investors are eager to finish the year on a strong note or begin the new one with vigor. Given that VC earnings are closely tied to the multiples on their invested capital, there remains a consistent interest in bankrolling promising startups. Angellist’s Q3 2023 data underscores this, revealing a notable uptick in investment activity.
Favorable Valuations: Recent trends show startup valuations undergoing a correction, reaching some of the most investor-friendly levels in recent history. Lower valuations allow investors to reduce their investment costs, making their desired returns more achievable. Q3 2023 reports from AngelList and Carta suggest that median valuations remained consistent or even edged higher across venture stages compared to the preceding quarter. Furthermore, AngelList’s Q3 VC report points out that valuations, particularly in the early stages, might have hit a floor, offering a potential uptick in the near future. For investors, this presents a lucrative window to enter before valuations surge.
The Angel Impact: Angel investors, especially in the early stages, have become indispensable. Data from Carta highlights that checks amounting to less than $25,000 constituted between 31% and 59% of all pre-seed capital raised in the first half of 2023. This engagement level is poised to rise with the sizable accredited investor base in the US and the increasing adoption of angel special purpose vehicles (SPVs), which offer a simplified and efficient medium for angels to pool resources and back startups collectively.
In conclusion, while cyclical downturns in venture capital can create an atmosphere of apprehension, they often conceal underlying opportunities. The current climate, with its abundance of uninvested capital, investor eagerness to achieve momentum, attractive valuations, and the significant role of angel investors, makes a compelling case for founders to actively pursue their fundraising initiatives. Armed with the right strategy and a clear understanding of the evolving investment landscape, founders can effectively navigate this VC winter, turning prevailing challenges into unparalleled opportunities.
Bunmi Olayanju MBA CFA is a finance expert and investor. Visit here to learn more about him
FDA Shuts Down Rizo Lopez Foods Cheese Site Over Listeria Outbreak: Food Safety and Health Headlines
Food Safety and Health
Reser’s Fine Foods Recalls Meal Kits Because of Listeria Contamination – Food Safety News
Reser’s Fine Foods is recalling certain meal kits because of the inclusion of recalled chicken from an outside ingredient supplier (BrucePac). The ingredient supplier recall is due to possible Listeria monocytogenes contamination.
FDA Shuts Down Rizo Lopez Foods Cheese Site Over Listeria Outbreak – Just Food
Rizo Lopez Foods, a US cheesemaker at the center of a listeria scare, has been forced to end production at its California facility.
Company Recalls Smoked Salmon Because of Positive Test for Listeria Monocytogenes – Food Safety News
Vasco & Company Seafood LLC is recalling filets of smoked Atlantic salmon because of contamination with Listeria monocytogenes.
Chicken Recall Ripples Through Supply Chain – Food Business News
A recall of nearly 10 million lbs of chicken processed by BrucePac, Woodburn, Ore., and potentially contaminated with Listeria monocytogenes is rippling through retail and food service supply chains.
Imported Eggs Linked to Swedish Salmonella Infections – Food Safety News
An outbreak of Salmonella with a probable connection to imported eggs is being investigated in Sweden.
Applied Nutrition Seeks Up to $287 Million In London IPO: Funding and Acquisition Headlines
Funding Acquisition and Finance News
Applied Nutrition Seeks Up to $287 Million In London IPO – Bloomberg
Applied Nutrition is seeking to raise as much as £220 million ($287 million) in its initial public offering, in what could be one of London’s largest first-time share sales this year.
Angel Yeast Invests $43.46m, Establishes New Subsidiary and Facility in Indonesia – FoodBev Media
Angel Yeast is partnering with agricultural company PT Tunas Baru Lampung (TBLA) to set up a subsidiary in Indonesia’s Lampung province. The subsidiary has a registered capital of $54.29 million, of which Angel Yeast will contribute around $43.46 million and hold 80% of the shares.
The Jackfruit Company Raises $5M to Fuel US Expansion and Innovate Jackfruit Products – Vegconomist
The Jackfruit Company (TJC), based in Boulder, Colorado, has secured a $5 million Series B extension funding round led by existing investors InvestEco, Creadev, and Grosvenor Food & AgTech.
Emmi Group Completes Mademoiselle Acquisition – Food Business News
The Emmi Group has completed its acquisition of French pastry manufacturer Mademoiselle Desserts Group.
Cal-Maine Pumps $40m Into Cage-free Egg Production – Just Food
US eggs major Cal-Maine Foods is investing $40m in new capital projects to expand cage-free production.
Chocolate Giant Puratos Makes Strategic Investment in California Cultured’s Cell-Based Cacao – Vegconomist
California Cultured, a startup pioneering plant cell culture to produce cacao, has received an undisclosed investment from Sparkalis, the food tech venture arm of the Belgian international group Puratos.
US Spicemaker Watkins to Be Acquired by Local Investors Cannae, KDSA – Yahoo Finance
The Watkins Company, a US manufacturer of branded herbs, spices, and popcorn seasonings, has agreed to sell a majority stake in the business. The shares have been sold to local investors Cannae Holdings and KDSA Investment Partners.
Pacific Seafood to Take Over Trident Seafoods’ Kodiak Operations – Just Food
Trident Seafoods has struck a deal to sell another asset, with Pacific Seafood set to buy its Kodiak processing facility in Alaska.
Blue Stripes Raises $20M in Series B Funding – Green Queen
US cacao startup Blue Stripes has closed a $20M Series B investment round to develop superfood chocolates, with backers including Hershey’s and celebrity chef Nick DiGiovanni.
Burcon Creates Plant-based Egg Protein Replacer: Food Tech and Innovation Headlines
Food Tech and Innovation News
Burcon Creates Plant-based Egg Protein Replacer – Baking Business
Burcon NutraScience Corp. has launched the Puratein canola protein isolate, which may be used as an egg replacer in bakery applications
Swedish Hydrothermal Treatment Innovation Makes Grains Mineral-Rich Like Meat – Vegconomist
The Mineral Shift, a Swedish project aiming to enhance mineral absorption from grains, has optimized an ancient process called hydrothermal treatment to reduce phytic acid, the antinutrient that binds mineral absorption.
Judge Rejects Upside Foods’s Request to Block Florida’s Cultivated Meat Ban – Green Queen
A federal judge has refused Upside Foods’ request for a preliminary injunction in its lawsuit against Florida’s ban on cultivated meat, throwing its Art Basel plans into doubt.
KWERKY Develops Powdered Plant Milk Made From Oat and Pea Protein – Vegconomist
British brand The Good Pea Company, known for producing milk alternatives made from split peas and coconut cream, has launched an offshoot range called KWERKY.
French Whole-Cut Vegan Chicken Startup Umiami Rebrands to Swap & Makes Play for the US – Green Queen
Umiami, the Parisian startup making whole-cut plant-based chicken, is now called Swap and has entered the US food service sector.
Fermify Secures US GRAS Status for Fermented Casein – Vegconomist
Fermify, an Austrian precision fermentation company developing milk proteins, announces it has obtained self-affirmed Generally Recognized as Safe (GRAS) status for its precision-fermented casein after conducting a comprehensive safety study, as per FDA requirements.
T. Hasegawa USA Introduces Orange Juice Replacement Solution – Food Bev Media
T. Hasegawa USA has introduced a new ‘Orange Juice Replacer’ solution that amplifies the natural citrus profile and minimizes raw ingredient use, aiming to stabilize costs for beverage manufacturers.