If you work in the food and drink industry, no day goes by without the word ‘innovation’ cropping up. Innovation is defined as “the ability to create new products, services, and business models that satisfy customer needs”.
Everyone is capable of a good idea, and with the advance of modern technology, the barriers to launching and testing something new have significantly lowered. So, why is innovation in the food and drink industry still a privilege?
We often view and comment on innovation as a system, in which external forces, markets and funding drive change. These are huge factors in how new ideas scale, but far too little attention is paid to how unequal innovation is at an individual level.
Investment figures are the starkest signal of the challenges innovators and entrepreneurs face. Between 2009 and 2019, 42% of venture capital money went to founders from an ‘elite educational background’ while only 2.87% went to all-female teams. Shockingly, just 0.25% of funding went to black-owned food and drink businesses.
These statistics should trouble us, not just morally but commercially. Many of these overlooked founders would have launched exciting and differentiated new products if supported. In theory, the food and drink industry is democratic. All genders, ethnicities, sexualities and ages purchase food. We’re all consumers, and good products meet consumer needs.
But establishing the consumer need is challenging. At Mission Ventures, our first task is to support our founders to speak to consumers. Often, we do this by building links with community groups and talking to people in their neighbourhoods.
There’s nothing like testing ideas at a mum and toddler session to understand how people really interact with products. Whilst this is fun and rewarding, getting closer to the individuals you’re trying to solve a problem for ultimately helps design better solutions. It’s hard but necessary work.
The alternative is products designed in echo chambers, which will face insurmountable problems ranging from supply chain issues, high costs, complexity, lack of awareness, lack of consumer need, and resistance by some parts of the population. In short, embracing diversity and diverse perspectives will help create better products.
But this is about more than just knowledge and good processes needed to generate ideas. For our industry to change, more focus must be on entrepreneurs and what can be done to build more equity for the opportunity to scale. As an example, black founders tell us they’re over-mentored and underfunded.
Removing the social and economic barriers to starting a new business allows underserved leaders to flourish. A prime example of this in action is the industry-leading Thrive with Sainsbury’s programme – a 16-week, free accelerator programme with a £1m commitment to fund the growth of black-owned businesses.
This programme was meaningful, with a tangible pot of funding, industry-leading support and a highly attractive route to market – more than 450 entrepreneurs applied for just nine spaces. The initiative was bold and progressive, and demand was high from exceptionally talented entrepreneurs who otherwise may not have had the opportunity to shine. Investors and large manufacturers should take note.
In the shadows of the pandemic and food inflation, our industry needs a new commitment to innovation. With such demand for solutions from talented founders, why is innovation still such a privilege?
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