Food Venture Financing News - Weekly Issue No. 38
In This Issue:
- Hopes Remain for a Renewed Stimulus in 2020
- Reminder: Employee Retention Tax Credit
- Food Venture Financing Trends
- Corporate Venture and Private Equity Funds
- Links to Relevant Content and Events
Hopes Remain for a Renewed Stimulus in 2020
- A push for an additional stimulus bill before year-end has gained bipartisan support, but no deal has been reached yet.
- The deadline to reach a deal was originally set for December 11th (when the 2021 government spending bill was due), but Congress is likely to extend the deadline to avoid a government shutdown.
- Hundreds of business groups delivered a letter to Congress late last week urging Congress to reverse the IRS's ruling that otherwise deductible expenses paid with PPP loans are not deductible.
Reminder: Employee Retention Tax Credit
- As many parts of the country enter a new phase of lockdowns, businesses should be reminded that the CARES Act provided for an employee retention tax credit.
- The tax credit is for 50% of wages paid, plus the cost of providing healthcare benefits between March 13, 2020, and December 31, 2020, up to a maximum of $5,000 in tax credit to any one employee.
- To be eligible: (a) a business must either be fully or partially suspended because of a governmental order due to COVID-19; or (b) the gross receipts of the business for the calendar quarter must be less than half of the gross receipts for the same quarter in 2019.
- Please note the credit is not available to any business that received a PPP loan.
- IRS FAQs regarding the tax credit can be found here.
Food Venture Financing Trends
- Kind Snacks, recently acquired by Mars, announced its acquisition of Nature's Bakery, expanding Mars' expansion into the health and wellness sector. The deal is valued at around $400 million.
- Natural Grocers, a supplement and organics foods retailer, expects that there will be continued interest in and demand for immunity-boosting supplements, such as Vitamin D and zinc, in 2021.
- In response to the negative effects of the COVID-19 pandemic on the alcohol industry, some lawmakers have requested that Congress extend existing federal excise tax rates for alcohol beverage producers that were implemented in 2017 and will expire in January 2021.
- Forbes noted in its report on the top 10 investment trends for 2021 that remote-based industry stocks, such as food delivery services, will likely see reduced demand next year, but that the restaurant industry stocks will likely rebound.
Corporate Venture and Private Equity Funds
Our featured CPG private equity firm this week is S2G Ventures.
- S2G Ventures is a multi-stage venture fund investing in food and agriculture.
- S2G's mission is to back the best entrepreneurs that are improving the overall health and sustainability of the food system.
- S2G has constructed a portfolio that focuses on the entire food supply chain, including the following representative investments:
- Benson Hill
- Clear Frontier
- Growers Edge
- Supply Chain
- Apeel Sciences
- Beyond Meat
- Good Eggs
- Maple Hill Creamery
- The UCAN Company
Links to Relevant Content and Events
- Blendid and Jamba Co-Brand New Smoothie Robot
- Grocery Optimization Platform Afresh Adds $13 Million & Former Ahold CEO
- Conagra Brands to Sell Peter Pan Peanut Butter to Post Holdings
- What Are the Significant AgTech Trends to Look Forward To?
- McCormick Warns Investors Away From Mini-Tender One Day After Acquiring Cholula Hot Sauce
- 6 Alt Protein Female VCs Who Are Changing The Future Of Food
- Labeling on Plant-Based Meat Is 'Potentially Misleading,' Judge Rules
- KIND Announces Acquisition of Better-for-You Snacking Company Nature's Bakery
- The Biden Spin on 'America First'
- Pandemic Will Boost Vitamins C & D, Zinc, And ALA In 2021, Retailer Says
- Senators and Alcohol Industry Pressure Congress for Tax Relief
- Top 10 Investing Trends of 2021
- Mosa Meat Gets $19.7 Million To Scale Up And Continue Moving Toward Cell-Based Meat Products
- Study: Consumers See Craft Chocolate as 'Novel And Exciting'
Naturally Bay Area Holiday Happy Hour & Mixer
Thursday, December 10, 2020, 4:00 - 5:00 p.m. PT
Holiday Toast & Virtual Mixer Hosted by Don Buder, Board Chair & Partner at Davis Wright Tremaine.
Pour yourself a holiday cocktail, and let's raise our glasses together before spending some time meeting, mingling, and spreading holiday cheer!
Naturally Bay Area's 3rd Annual Pitch Slam
Thursday, February 11, 2021
Here's your chance to show what you've got — get in front of top industry investors and your peers (virtually)! Naturally Bay Area's 3rd annual Pitch Slam competition celebrating the Bay Area's brightest brands, and giving the spotlight to a handful of local, emerging companies who will go head to head for a chance to win prizes worth thousands of dollars.
Apply to pitch here (Applications due Thursday, January 7th)
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.