Food Venture Financing News - Weekly Issue No. 32
In This Issue:
- PPP Tax Reminder #1: Expenses Payable With PPP Loan (Currently) Not Deductible
- PPP Tax Reminder #2: State Tax Implications
- Food Venture Financing Trends
- Links to Relevant Content and Events
PPP Tax Reminder #1: Expenses Payable With PPP Loan (Currently) Not Deductible
- The CARES Act provided that for federal tax purposes (see below), forgiveness of a PPP loan may be excluded from gross income.
- However, in April the IRS stated that expenses paid with PPP proceeds would not be deductible, which has the effect of negating the benefit of forgiveness.
- This is consistent with historic IRS guidance regarding nontaxable income (avoiding a "double dip"), but does not align with Congress's stated intention of providing a benefit to small businesses.
PPP Tax Reminder #2: State Tax Implications
- The impact of PPP forgiveness and deduction of expenses on state and local taxes will depend on each state's determination.
- Many states conform to the Internal Revenue Code, but the CARES Act did not amend that Code.
- As an example, California's Franchise Tax Board provided in May that it was studying the impact of the CARES Act on California taxpayers, but has not rendered much in the way of guidance yet.
- We strongly recommend that small businesses consult with their tax professionals on this point.
Food Venture Financing Trends
- Whole Foods Market released its top 10 food trends for 2021, which include nutritional supplements, innovative breakfast foods, and healthy snack options. They reflect the increase in home cooking and healthy foods as a result of the COVID-19 pandemic.
- McCormick's recent Flavor Forecast predicts that sweet and seasonal flavor combinations, global ingredients, and spicy flavors are upcoming flavor and ingredient trends for 2021.
- Foodspace, a foodtech artificial intelligence company, recently released its attribute management technology product, which will assist brands and retailers in building attribute personalization strategies. The technology is expected to efficiently and accurately capture and categorize product data of CPG brands in order to improve category management systems of various retailers.
- As consumers begin moving towards ecommerce to buy groceries, retailers must ensure the ecommerce platform is structured to satisfy consumers' purchasing habits. The variety of products and user experience are two factors to consider for retailers looking to move to ecommerce.
Links to Relevant Content and Events
- Grain Monitoring Startup Telesense Closes $10.2M Series B To Ramp Up Sales
- Eliot’s Nut Butters Eyes Accelerated Expansion
- SKS 2020: Impossible Foods CEO on Cell-Based Meat: "It's Never Going to Be a Thing"
- TeleSense Raises $10.2M for Its IoT Crop Spoilage Prediction Platform
- BrightFarms Raised $100M Series E for Its Indoor Farms
- Pet Tech Market to Witness Huge Growth by 2028
- From Privately Held to Publicly Traded, Should Small Companies Take the Plunge?
- Food System Investing in a Regenerative Economy
- Whole Foods Reveals Top 10 Food Trends For 2021
- Food Tech Startup, FoodSpace, Launches New Technology to Help Brands Capture Product Data Efficiently
- Can Digital Marketplaces Feed Grocery Shoppers' Growing E-Commerce Appetite?
- McCormick Flavor Forecast 2020
- Bacardi First in Fight Against Plastic Pollution With 100% Biodegradable Spirits Bottle
- Last week, Whipstitch released its Healthy Living Consumer Products: Industry Update, Deal Review and Top Trends analysis. Click here to download the full presentation.
Naturally Austin Combo Loco Competition Finale & Member Happy Hour
Tuesday, October 27, 2020, 5:45 pm PT
After a six-week journey, see what finalists went through for the 2020 Naturally Austin Combo Loco Competition brought to you by H-E-B! This will be a night of celebration to see what the finalist organizations pitched and when the winner will be announced. It will consist of the show which will premier at 6pm followed by a happy hour with our finalists, judges, and sponsors.
Naturally Bay Area QUICK BITES Lunchtime Series
Finding Growth Given Continuing Behavioral Shifts From COVID
Wednesday, November 18, 12:00 - 1:00 pm P.T.
- Jessica Malach: VP Partnerships & Insights at Social Nature
- Christie Lee: Founder of Nourishing Food Marketing
- Jennifer Berliner: Moderator, Naturally Bay Area & Head of Go To Market, Planet FWD
Naturally Boulder 16th Annual Pitch Slam & Autumn Awards (Virtual Edition)
Thursday, October 29, 2020
Innovation Showcase - 1:00 - 4:00 pm MDT
Pitch Slam & Autumn Awards - 4:00 - 6:00 pm MDT
Naturally Boulder's annual competition challenges entrepreneurs to pitch their young companies to an online audience of industry legends and up-and-comers.
Get your pass here
Naturally Austin's Beck Flavors Unveils Flavors of the Year 2021
Tuesday, November 10, 2020, 10:00 am CDT
In partnership with Naturally Austin and hosted by tasteMAKERS Cat Neville, Beck Flavors is announcing the four flavors of the year including: the People’s Choice, Fruit, Botanical and Innovative. The webinar will present how the 2021 flavors were determined, along with a craft cocktail demonstration by Mixologist, Leslie Newsam of the Antler Room.
ICA Fund Good Jobs 2020 Accelerator Pitch Event
Thursday, November 19, 2020, 10:00 am - 12:00 pm PST
The ICA Accelerator Pitch Event is a special opportunity for founders to showcase their businesses and get connected to potential investors. ICA Fund Good Jobs is based in Oakland, CA.
Please check out DWT's newly re-launched Startup Law Blog
At DWT, we are proud to have one of the largest Food & Beverage legal practices in the country, with over 40 attorneys representing food innovators, entrepreneurs, and investors at every level of the food chain, from Farm to Label.
Please contact our Food and Beverage team if we can assist you in any way in these unprecedented times.
The facts, laws, and regulations regarding COVID-19 are developing rapidly. Since the date of publication, there may be new or additional information not referenced in this advisory. Please consult with your legal counsel for guidance.
DWT will continue to provide up-to-date insights and virtual events regarding COVID-19 concerns. Our most recent insights, as well as information about recorded and upcoming virtual events, are available at www.dwt.com/COVID-19.