Max Baumann

Consolidation is proving to be a viable alternative for some companies in the once-hot food tech space. David 🤝 Epogee PepsiCo 🤝 poppi Flowers Foods & Subsidiaries 🤝 Simple Mills The Hershey Company 🤝 LesserEvil Brand Snack Co. FoodYoung 🤝 MeliBio Big Idea Ventures 🤝 Vevolution Venture funding for food tech has fallen sharply in recent years, but M&A activity in the space appears to be on the rise. The funding and dealmaking trends indicate that in the face of declining investor interest, consolidation is proving to be a viable alternative for some companies in the once-hot food tech space. Nathan Cooper of Barrel Ventures shares, “Many of the companies that were funded were years, if not decades away from commercial viability. They were seeing tech valuations, and required substantial amounts of cap-ex, when at the end of the day what they were selling was a CPG (consumer packaged goods) product and should have been valued as such.” Andrew D Ive of Big Idea Ventures commented, “Valuations have normalized compared to two years ago, creating an attractive window for strategic buyers to acquire de-risked, well-funded companies with validated technologies — often at reasonable prices.” This is a great article by Crunchbase highlighting the consolidation activity of the foodtech space. My tip to startups who are struggling to fundraise. Start having serious M&A conversations because you might be surprised at the partnerships you may find! https://lnkd.in/gHVJ35nm

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PRODUCT–MARKET FIT IS THE ONLY THING THAT MATTERS IN CPG You can have: • Beautiful packaging • A $5M seed round • A strong team …and still be fuc*ed if you don’t have PMF. Here’s how you know you’ve actually found it 1) Reorders happen 2) New doors open 3) You can raise prices and velocity doesn’t plummet 4) You can pour gas on it and it scales How else do you know if you have product market fit?

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Cannabis founders build ‘premium’ brands to avoid competing on price. Guess what? In CPG, even premium products have to compete on price. Part of the issue is that many founders don’t understand what premium means, and therefore don’t understand what a premium buyer persona looks like. Premium does not mean luxury. Patagonia is premium. Gucci is luxury. Veuve Clique is premium. Dom Perignon is luxury. Premium buyers still look at price tags. Patagonia competes on price against North Face in REI. Veuve competes with Moet on price in liquor and grocery stores. Premium buyers and budget buyers are both driven by the same thing: value. However, what creates value for each group is slightly different. Budget buyers are looking for the best combination of price and quality, generally with a hard line spending cap that is difficult to break through. For this segment, cannabis is 90% CPG, and 10% Fashion. Premium buyers are judging products on a 3-way vector of price, quality, and ‘instagramability’ / “clout generation”. They generally shop with a more flexible spending cap. For this segment, cannabis is 40% CPG, and 60% Fashion. A couple key points to remember: *Budget shoppers still buy premium products! This is especially true in mature markets where a consumer might walk in with $80 to spend per week, but can grab a weeks worth of products for $60. Oftentimes, they ‘splurge’ fill the remainder of their cart of premium goods. *Premium shoppers account for less than 10% of the cannabis market. They might be the loudest group, and they are certainly the most over served. *Serving budget shoppers (successfully) doesn’t mean serving up garbage. It means delivering the best product possible, at a target price.

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According to Crunchbase, global food tech funding in 2024 hit just $6B—down from over $20B in 2021. But the real story? M&A is surging. From PepsiCo’s $1.95B acquisition of poppi to David’s purchase of Epogee , strategic buyers are back at the table, hungry for innovation with clear revenue paths. Consolidation is the name of the game as valuations normalize and capital tightens. This is a shift worth watching: visionary tech is no longer enough—now it’s about viability, profitability, and execution. Startups that can deliver are becoming prime acquisition targets. What do you think—is this the golden window for M&A in food tech? Read More: https://lnkd.in/ebgTwSxb #FoodTech #MergersAndAcquisitions #CPG #VentureCapital #SustainableFood #Protein #Innovation #Hospitality #EmergingBrands #FoodInnovation Hospitality Headline Newsletter Branded Hospitality Peter Rahal Mary Ann Azevedo Nathan Cooper Sam Polk, CFA Allison Ellsworth

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The fact that AI now recognizes tech-forward, Maker-focused models like LibDib as the future of distribution is a big moment—and a strong validation of what we’ve been building. The alcohol distribution landscape is changing—and AI is taking notice. We asked Google’s Gemini which distributors small and mid-sized alcohol brands should consider, and the response was clear: LibDib is a top choice. As LLMs like Gemini, ChatGPT, and Perplexity reshape how Buyers and Consumers discover products, it's more important than ever for brands to rethink their go-to-market strategy. Some predict 75% of online revenue will soon be driven by AI over traditional search. Check out what Gemini had to say and why LLM's matter for every brand. https://lnkd.in/e2GiPuVy

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There are rumors swirling that Beyond Meat may be preparing to file for bankruptcy. This is a warning for emerging CPG brands. I’ve been very critical of Beyond in prior posts. They’re the personification and poster child of VC arrogance and tech bro mentality in CPG - the “growth at all costs” model, and the belief that if you throw enough cash and marketing behind a product that eventually consumers will buy in. Beyond is ultimately a lesson in product market fit. The core users of beyonds products are vegans who don’t consume meat for ethical or dietary reasons. That’s a single digit consumer base who make habitual purchases of this category. Not enough to build a meaningful business or justify the massive shelf space them and Impossible Foods paid in every major grocery retailer. Beyond always believed that they could capture the “flexitarians”, people like me who will eat meat but sometimes choose vegan products for their perceived healthiness. One problem? These products aren’t healthy. They clearly meet the definition of an “ultra-processed food”. Consumers caught onto this. They recently dropped the word “meat” from their products, attempting to change this perception reposition the brand as a protein company. Very clearly looks like a last gasp before they go under, sad conclusion to a story which I’ve seen coming for years. If you’re an emerging brand, make sure you actually have a loyal repeat consumer with a large addressable audience BEFORE scaling into every imaginable class of trade.

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CREATIONS FOODS AND REAL COOKIES MERGE Creations Foods, parent company of HighKey Cookies merges with Get Real Foods creating a vertically integrated CPG platform. Creation Foods brings their manufacturing and operating platform specialized in BFY snacks, the company has built its brand portfolio through acquisitions: - Moon Cheese acquired in 2023 - HighKey, acquired in 2024 REAL Cookies, founded in 2021, makes cookies for people with dietary restrictions. The company was bootstrapped by founders Lauren Berger and Maria Felton, although they were open to strategic partners. The combination pairs Creations Foods’ scalable manufacturing, operating platform and portfolio of snack brands with Get Real’s signature BFY cookies. This combination follows the news of TUYYO, Nemi Snacks and Todo Verde merge in into a single platform

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Co-manufacturing risk is the most underpriced threat in early-stage CPG right now. A founder I follow shared a story this week: months deep in R&D with a co-man, product launched, sales ramping then the partner raised pricing 300% and eventually refused to produce. Months of momentum, gone. This isn't an edge case. It's the norm. Most emerging brands rely on 1-2 co-manufacturers with zero leverage and no backup plan. As ingredient costs rise and co-mans prioritize bigger clients, the power imbalance is getting worse. The founders building contingency into their supply chain from day one dual sourcing, owning key processes or even the facility are in pole position. #CPG #FoodAndBeverage #SupplyChain #Manufacturing

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Barebells launched its first U.S. beverage: Protein Soda, a 12oz can packing 200mg of caffeine,10g of clear whey protein, B vitamins, zero sugar and just 50 calories. It’s fizzy. It’s functional. And it’s exactly where the CPG market is headed. We’re watching the rise of hybrid beverages, products that blend categories once seen as opposites: 1. Energy + Recovery 2. Indulgence + Performance 3. Convenience + Clean Label Consumers no longer think in silos (“protein drink” vs “energy drink”), they want one product that meets multiple needs in one moment. Barebells nailed that by merging gym culture with everyday refreshment. This move also reflects a bigger CPG shift: Performance as Lifestyle. People aren’t just fueling workouts, they’re optimizing commutes, meetings and everything in between. The win here isn’t just in the formula, it’s in the positioning. “Protein Soda” doesn’t sound like a supplement or a shake. It sounds fun, familiar and frictionless. That language lowers barriers and makes functional nutrition feel mainstream. The best new products in wellness and functional CPG aren’t adding more, they’re combining smarter. Would you crack open a protein soda on your way to the gym or does the idea of protein + caffeine in one can push the boundaries too far? #TrevorHague #FunctionalBeverages #CPG #BrandStrategy #Wellness

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This week’s CPG food industry news: ⸻ 🏭 Manufacturing & Operational Updates • PepsiCo Closes California Frito-Lay Plant PepsiCo has shuttered one of its Frito-Lay production facilities in California as part of broader cost-cutting and capacity realignment efforts within its snack division. • J.M. Smucker’s Hostess Plant Shutters Smucker’s announced the closure of its Hostess-branded production facility, moving output to other sites to streamline operations. • Grupo Bimbo Targets Whole-Grain Expansion The global bakery leader stated new goals to ramp up whole-grain product offerings, responding to growing consumer demand for healthier staples. ⸻ 🌱 New Product Launches • Nature’s Path Introduces Toddler Oat Snacks The company launched clean-label, vegan oat-based snacks for toddlers in three flavors, tapping into the child nutrition and natural foods niche. • Califia Farms Releases Protein Latte Positioned for health-conscious consumers, the new ready-to-drink protein latte delivers 10 g of protein per serving. • Pirucream Bites Debut Sindoni North America rolled out filled rolled wafer snacks in four flavors, targeting indulgent snackers. ⸻ ⚖️ Packaging & Regulatory • Mondelēz Sues Aldi Over Packaging Copycat Mondelēz has filed a lawsuit claiming that several of Aldi’s private-label packaging styles for Oreo and Chips Ahoy are confusingly similar and misleading to consumers. • GLP‑1 Trend Shaping Packaging Demand As consumers adopt GLP‑1 medications, packaging companies are adapting to demand for items supporting smaller portions and health-focused messaging. ⸻ 📊 Broader Trends & Policy • SHIFT Towards Healthier Products A BCG report highlights the industry’s shift toward nutritious, minimally processed foods, influenced by wellness culture, regulation, and GLP‑1 adoption. Market growth decelerated to 2.1% in 2024. ⸻

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Palm wine is one of the oldest alcohol categories in the world. I'd never heard about it until I met Onye. Onye Ahanotu from Ikenga Wines wants to bring palm wine to the U.S. market that’s made 100% in the US. He has invented a bio-design process that recreates palm sap without the palm tree. He uses plants to recreate the properties of the sap and then runs it through a traditional fermentation process to produce palm wine in tanks. Onye’s vision is to use this bio-design/bio-manufacturing process to create an entirely new product category in the US. Full conversation up at Going Direct later this week.  Link in comments below.

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🚨 Where are the funding options for sub-$1M brands? Every single week, I talk to 100+ founders LIVE inside my ShelfMade community. Through my Founder Circles and office hours, I’m in the trenches with early-stage CPG brands…hearing their wins, struggles, and everything in between. And week after week, I keep hearing the same 4 things on repeat: 1️⃣ “I’m doing less than $1M… how the hell do I raise money?” 2️⃣ “How do I get into retail… the right way?” 3️⃣ “How do I find the right manufacturer?” 4️⃣ “Who can I actually trust to partner with…agencies, suppliers, brokers, etc.?” Here’s what’s wild to me 👇 There’s no real funding option for brands under $1M in revenue. We all know how brutally hard it is to make a CPG product work. If your margins don’t work, your brand won’t either. Period. But for the brands that do have something special.. a killer product + margin, strong founder, smart strategy..the lack of funding options is a massive gap in the ecosystem. I get why investors see early CPG as “too risky.” But it’s also where the upside is the highest. Inside my Founder Circles, I have a front-row seat to who’s “working” way before the rest of the market sees it… founders with velocity, strong branding, margin, sharp instincts. And it got me thinking… 👉 What if Shelfmade became the bridge? 👉 What if we not only advised and connected early-stage founders, but funded them too? 👉 What if the ecosystem supported them through both capital and community? Early capital + intimate founder circles + advisor access = a real shot at building something lasting. No one’s putting founders in curated rooms with both peers and advisors while backing them with capital. I wish this existed when I was building.. 🔸 If you’re a founder, what’s been your biggest challenge raising? 🔸 If you’re an investor, what would make you lean in at this stage? 🔸 If you’re in the ecosystem, what are you seeing? Happy Sunday Fam

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