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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
La Vie Raises €25M, Reports €19M in Revenue: Funding and Acquisition Headlines
Funding Acquisition and Finance News
La Vie Raises €25M, Reports €19M in Revenue – Vegconomist
French plant-based pork and deli brand La Vie has secured €25 million in a new funding round, taking the total amount it has raised over the past three years to €50 million.
Lucky Energy raises $11.75M in Oversubscribed Series A Funding Round – FoodBev Media
US energy drink company Lucky Energy has closed an oversubscribed $11.75m Series A funding round led by Brand Foundry Ventures.
Meatable Preps for Series C Funding Round – Food Dive
Meatable is inviting a group of global leaders, including meat industry representatives, scientists, investors, and policymakers to an invite-only Series C fundraising in early 2025.
UOBO Secures Six-digit Funding – Vegconomist
Barcelona’s UOBO, a food tech startup on a mission to revolutionize food manufacturing with alternatives to eggs, has raised €500,000 in a seed funding round led by Enzo Ventures.
Original Juice Company, SPC, and Nature One Dairy Merge to Form New Business – Just Food
Australia’s The Original Juice Company (OJC), SPC Global, and powdered milk business Nature One Dairy are set to merge and create a new company.
Butterfly Equity to Acquire The Duckhorn Portfolio for $1.95bn – FoodBev Media
Butterfly Equity, a private equity firm focused on the food and beverage sector, has announced a definitive agreement to acquire The Duckhorn Portfolio, a luxury wine producer, in an all-cash transaction valued at approximately $1.95 billion.
Prairie Farms Dairy Acquires Ohio-based Dairy Firm SmithFoods – FoodBev Media
Illinois, US-based dairy company Prairie Farms Dairy has acquired SmithFoods for an undisclosed sum.
Simulate Announces Acquisition by Ahimsa Companies – Vegconomist
Simulate, the company best known for producing plant-based nugget brand NUGGS, has announced an acquisition by plant-based investor Ahimsa Companies.
Nutkao Hazelnut Spreads Acquired by Moroccan Royal Family-linked Teralys – Just Food
Nutkao, the chocolate and hazelnut spreads business, has indirectly come under the ownership of the Moroccan royal family. Teralys, the agri-industrial unit of Al Mada Holding, has acquired Piedmont, Italy-based Nutkao for an undisclosed sum.
Kellanova Injects £75M Into British Cereal Production – FoodBev Media
Kellanova has announced plans to invest £75 million in its cereal factory in Wrexham, North Wales.
FDA’s Human Foods Program Begins Operating: Food Safety and Health Headlines
Food Safety and Health
FDA’s Human Foods Program Begins Operating – Food Business News
The US Food and Drug Administration’s Human Foods Program went into effect Oct. 1. The program is designed to protect and promote public health through science-based approaches to prevent foodborne illness, reduce diet-related chronic diseases, and ensure the safety of chemicals in food.
Happy Moose Juice Recalled Because of Potential Contamination – Food Safety News
Youngstown Grape Distributors Inc., a co-manufacturer of Happy Moose Juice, is voluntarily recalling Happy Moose Tropical Roots Juice and Happy Moose Strawberry Fields because a portion of the production did not complete the High-Pressure Processing (HPP) treatment.
EU Court Blocks France’s Attempt to Ban Meaty Names On Plant-Based Food Labels – Green Queen
The European Court of Justice has rejected France’s proposed ‘veggie burger’ labeling ban, allowing plant-based food producers to continue using meat-like terms on their packaging.
L&B Lone Star Dip Recalled Because of Mold – Food Safety News
Lunds & Byerlys is recalling approximately 500 containers of L&B Lone Star Dip because of potential mold growth contamination.
UK Signs New Poultry Export Deal With South Africa as Bird Flu Ban Ends – Just Food
The UK has announced that an avian-influenza-linked trade embargo with South Africa has been lifted.
BioMush Unveils Plug-and-Play Fermentation Tech: Food Tech and Innovation Headlines
Food Tech and Innovation News
BioMush Unveils Plug-and-Play Fermentation Tech – Vegconomist
Finnish food tech company BioMush has developed solid-state fermentation technology using fungi to transform edible side streams and food waste into umami-flavored ingredients.
Chiquita and Partners Introduce Disease-resistant Banana Variety – FoodBev Media
Chiquita Brands – in collaboration with KeyGene, MusaRadix, and Wageningen University and Research – has unveiled a new banana hybrid named ‘Yelloway One’.
The EVERY Company Secures Patent for Fermented Ovalbumin – Vegconomist
San Francisco-based The Every Company has been granted a new patent (US 12/096,784 ) covering the scope and use of its precision fermentation-derived ovalbumin.
UK Invests £1.6 Million in Europe’s First Regulatory Sandbox to Fast-Track Cultivated Meat Approval – Green Queen
The UK government has awarded £1.6M to the Food Standards Agency to create a ‘sandbox’ to fast-track cultivated meat approval, alongside a new regulatory office.
Heura Expands Beyond Plant-Based Meat – Vegconomist
Spain’s Heura Foods, best known for producing plant-based meat alternatives, has announced it will be expanding into new categories to improve nutritional density and transform foods often labeled as ultra-processed.
Revo Foods Opens ‘World’s Largest’ 3D Food Printing Facility in Vienna – FoodBev Media
Revo Foods, an Austrian plant-based seafood start-up, has opened what is claimed to be the ‘world’s largest’ industrial facility for 3D food printing.