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Campbell Soup CEO Denise Morrison said Wednesday that her company is making a big bet on finding and funding food startups as it tries to branch out into new areas for growth.
The company, which has acquired a variety of food businesses to expand beyond its soup heritage, will be the sole limited partner in the new fund, Acre Venture Partners. Campbell is contributing $125 million to the project.
"There's a massive influx of venture capital aimed at disrupting the food ecosystem, flowing from traditional VC firms and from funds managed by large food companies. Since 2010, approximately 400 food startups have received more than $6 billion in funding," Ms. Morrison said at the Consumer Analyst Group of New York Conference.
Campbell has made some early stage investments in startups, but believes "a more strategic and methodical approach" is needed, she added.
The move comes as Ms. Morrison continues to update Campbell's portfolio to respond to a variety of "seismic shifts," she discussed Wednesday, which include everything from economic concerns such as the declining American middle class to the growing diversity of younger consumers, the rising use of digital technology and consumers' desire for healthier and fresher fare.
Even as the company has been updating its product lineup, it expects its sales this fiscal year to be down 1% to flat. Still, that would be an improvement from a 2% decline in fiscal 2015 which stemmed in part from having one less week than fiscal 2014.
The company now gets 34% of sales from its iconic soup, down from 40% in 2011, the year Ms. Morrison became its CEO. It has added brands such as Bolthouse Farms, Plum Organics and Garden Fresh Gourmet to diversify its lineup, which already included products such as Pepperidge Farm, Prego and V8.
Soup is still the biggest part of the portfolio at 34% of sales in 2015, followed by cookies and other snacks at 31%, simple meals at 21% and beverages at 14%.
"Listen, if you apply the Andy Warhol filter to our company, if you view us strictly through the lens of the iconic can, then you're completely missing the big picture," Ms. Morrison said.
Other consumer packaged-goods marketers have made similar moves in funding and looking for emerging companies, from Unilever's Project Foundry to Procter & Gamble's Connect & Develop. 301 INC is a unit within General Mills that works on partnerships with emerging food brands. General Mills has already acquired jerky maker Epic. Mobile Futures is the name of Mondelez International's effort that began in 2012 to accelerate mobile innovations and incubate new ventures. It was followed last year by Shopper Futures, which is working on shaking up the consumer retail experience.
Campbell said Acre Venture Partners, a Delaware limited partnership, will be independent and managed by outside partners. However, a Campbell subsidiary will be the sole limited partner in Acre Ventures. Also, Jeff Dunn, president of Campbell Fresh, will be on Acre's investment committee representing Campbell, the company said.
An earlier version of this story inaccurately said General Mills was an investor in jerky maker Epic. The company had discussions with Epic, but was not an early investor.