Food Venture Financing News - Weekly Issue No. 44
In This Issue:
- PPP Forgiveness Rejected?
- Economic Aid Act Targets Under-Resourced Businesses
- Food Venture Financing Trends
- Links to Relevant Content and Events
PPP Forgiveness Rejected?
- If a PPP borrower believes its forgiveness application was incorrectly denied by the SBA, whether in whole or in part, and whether the denial was based on the borrower's eligibility for a PPP loan or its use of funds, the borrower may appeal the SBA's decision.
- Any appeal must be filed no later than 30 calendar days after the borrower's receipt of the SBA's decision.
- Given the short time period to file an appeal, it is critical that borrowers keep good records, including payroll tax filings, employee wage reporting and unemployment filings, for PPP forgiveness applications.
Economic Aid Act Targets Under-Resourced Businesses
- The recently enacted Economic Aid Act has drawn attention for its authorization of second PPP loans, but it is important to note that the Act has also attempted to facilitate borrowing by traditionally under-resourced companies.
- The law earmarks $15 billion for first-time borrowers, and $25 billion for second-time borrowers that have 10 or fewer employees.
- $30 billion is reserved for smaller financial institutions that lend to underserved borrowers.
- In addition, the Act allocates $25 million to Minority Business Development Centers to assist minority borrowers with applying for financial relief.
Food Venture Financing Trends
- M&A activity is accelerating in the food and beverage sector. Kraft Heinz recently announced that it is close to reaching a deal to sell its Planters peanut business to Hormel Foods for a deal valued at approximately $3 billion.
- Uber announced that it plans to buy Drizley, an alcohol delivery startup, for approximately $1.1 billion.
- VC interest accelerated for food and beverage startups. Pairwise, a foodtech startup that utilized CRISPR technology to enhance produce, announced it raised $90 million in its Series B round.
- IRI has reported new research that small CPG companies gained approximately 1.3 points in market share, approximately $12 billion, signaling consumers' shift from large CPG products to smaller CPG manufacturers and private label products.
- Kellogg Company announced its partnership with Future Food-Tech in launching an Innovation Challenge for foodtech startups. The Innovation Challenge will highlight companies that focus on plant-based and gut wellness technologies.
- Post Holdings led $12.5 million investment in PeaTos. This is the first Big Food funding for the challenger to PepsiCo's Frito-Lay and the latest move into the plant-based space by the CPG company best known for its breakfast offerings.
- Future Meat Technologies makes cell-based chicken costing $7.50 and gets $26.75 million funding. The Israel-based cultured meat company is planning to get its products on plates in 2022 — or earlier if regulatory agencies move faster.
- Impossible Foods cut grocery store prices 20%. The price decrease is the first since the plant-based burgers hit grocery shelves in 2019. It follows two 15% reductions in price to foodservice distributors during the past 12 months.
- Nestlé set a goal of 100% responsibly sourced coffee by 2025. The company requires farmer groups and suppliers to adopt practices aligned with its Responsible Sourcing Standards.
- The food and beverage industry has started vaccinating essential workers. Tyson Foods and Foster Farms announced that they have begun vaccinating workers in some plants.
Links to Relevant Content and Events
- Smart Oven and Meal Delivery Startup Tovala Raises Additional $30 Million
- Pairwise Raises $90 Million to Develop New Fruit and Vegetable Varieties Using CRISPR
- Resilient Biotics Raises $7.1 Million From Elanco, Others to Create Livestock Microbiome Medicines
- AppHarvest Completes SPAC Merger To Go Public at $1 Billion+ Valuation
- Retailer, E-Commerce Platforms Gain Funding
- Specialty Food Innovators Weigh In on Trends
- Brightloom Raises $15 Million, Launches a 'Customer Growth Platform' To Help Restaurants With Their Data
- Post Holdings Leads $12.5 Million Investment in PeaTos
- Future Meat Technologies Makes Cell-Based Chicken Costing $7.50 and Gets $26.75 Million Funding
- Impossible Foods Cuts Grocery Store Prices 20%
- Nestlé Sets Goal of 100% Responsibly Sourced Coffee by 2025
- Chobani Eyes 2021 Initial Public Offering
- Oatly Weighing $10 Billion Value in U.S. IPO
- Kraft Heinz Nears Deal To Sell Planters Brand to Hormel
- Uber To Buy Alcohol Delivery Startup Drizly for $1.1 Billion
- IRI Finds Small, Extra-Small and Private Label CPG Manufacturers Gained Market Share in 2020
- Kellogg Company Joins Forces With Future Food-Tech to Launch Start-Up Innovation Challenge
- Tyson and Foster Farms Begin COVID-19 Vaccinations at Some Plants
Naturally Bay Area's 3rd Annual Pitch Slam
Virtual Broadcast From The Bay Area, California
Thursday, February 11, 2021 - 2:00 – 4:00 pm PT
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.
Get tickets here
Hirshberg Entrepreneurship Institute Webinars
Yes We Can: Perspectives and Strategies for a Successful 2021
These webinars will provide practical perspectives and real world advice for navigating financing, cashflow, retail, distributor, and eComm challenges in the year ahead presented by seasoned experts with opportunities for you to get your questions answered by the presenters.
February 10 – UNFI 2021 Outlook
Speaker: John Raiche, Senior Vice President, Supplier Services, UNFI
February 17 – INFRA and NCG Outlook
Speakers: Pat Sheridan, Interim President & CEO, INFRA Ben Nauman, Sr. Director of Purchasing, National Co+Op Grocers
February 24 – Telling Your Story and Getting Trial and Discovery in the New Covid World
Speakers: Jessica Rubino, Sr. Director, Content Marketing, Informa Markets (tentative) Annalea Krebs, CEO and Founder, Social Nature
March 3 – Brands Launching in the Current Market
Speakers: Nicole Bernard Dawes, Founder & CEO, Nixie Sparkling Water Matt McLean, Co-Founder, Uncle Matt's Organic
March 10 – The Latest Consumer and Market Trends and Insights
Speakers: Carlotta Mast, Sr. Vice President and Market Leader, New Hope Network Steve French, Sr. Vice President, National Marketing Institute
March 17 – How to Successfully Pitch for $$
Speakers: Andy Whitman, Managing Partner, 2x Consumer Growth Partners Paul Richardson, Co-Founder and Managing Partner, Renewal Funds
March 24 – Navigating Costco & Thrive
Speakers: Jeremy Smith, President and Founder, Launchpad Second speaker TBD
Register at hirshberginstitute.com
NEW ACCELERATOR COHORTS
- Hands-on mentorship with Food Future's network of experienced executives, entrepreneurs, and investors with expertise in production strategy, distribution strategy, financing strategy, governance structure and design, marketing and branding, organizational and operating model design, and more.
- Up to a $10k investment with participation in business acceleration program designed to propel and optimize growth.
- Upon completing the program, up to two companies could receive an additional investment from the Food Future Fund as part of their seed or Series A round of financing.
Apply here (Applications are due by Friday, February 12th at 11:59 pm EST).
Raley's Sponsors California Food Lab
Grocery chain Raley's will sponsor the Raley's Food Lab at the Lab@AgStart incubator, set to open in Woodland, California on April 1. AgStart, part of the AgTech Innovation Alliance which seeks to advance innovation in agriculture, food and health, created Lab@AgStart as a shared use incubator for food entrepreneurs.
Raley's Food Lab will be a certified food facility where innovators can develop new products, ingredients for taste testing, sampling, and small-volume sales. The facility will have a full kitchen and food preparation equipment. Raley's will also provide entrepreneurs with mentorship and support to help scale their businesses.
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.