Updated: Feb 19, 2020
by Nadia Berenstein
This morning, PepsiCo announced the ten finalists in its second North American Greenhouse Accelerator program. Chosen from a competitive pool of more than a hundred applicants from the U.S. and Canada, each of the ten startups will be awarded $20,000 and take part in a six-month business development program, where founders will work with mentors across PepsiCo to grow and optimize their business models. At the conclusion of the program, one company will be selected to receive an additional $100,000 grant.
PepsiCo’s Greenhouse Accelerator program is designed to support innovative, mission-driven entrepreneurs and companies “at the forefront of transformative trends” in the food and beverage industry, aiming for that sweet spot at the intersection of convenience, wellness, and values. Applicants must have products that are currently available for sale in North America, and be able to show more than $1 million in annual sales revenue.
This year’s Greenhouse Accelerator cohort could serve as a handy guide to the buzziest growth areas in the food and beverage marketplace. All of them produce plant-based products, and many boast additional clean label credentials: gluten free, non-GMO, no added sugar. Some showcase novel functional ingredients, or feature sustainable supply chains and ethical sourcing.
Here are this year’s finalists:
Beauty Gourmet targets the growing appetite for food-beauty crossover products, with a line of sparkling teas containing Ayurvedic wellness ingredients.
Love Corn delivers a premium, healthier take on the corn nut, using non-GMO Project Verified kernels. Inspired by founder Trace Ostergren’s travels in China,
MudLrk sells shiitake and jackfruit crisps in flavors including Sriracha and Kansas City BBQ.
NuMilk develops technologies for food retailers that allow consumers to make their own plant-based milks in-store.
The Nuttee Bean Company makes Favalicious, a line of high-protein whole roasted fava bean snacks.
Shindig Juice, founded by Joanne Johnson-Sabir and her husband Maanaan Sabir, creates nutrition-dense fruit and vegetable juices. A community-driven enterprise, the company has made it its mission to address systemic health and economic disparities in Central City Milwaukee.
Siren Snacks, founded by sisters Elizabeth and Abby Giannuzzi, makes whole-food-based snack foods, some featuring functional ingredients such as Reishi and CBD to deliver energy or calm.
Spudsy makes craveable sweet potato puffs from aesthetically imperfect spuds, the “ugly sweet potatoes” that would otherwise have been left in the ground.
Cambridge, Massachusetts-based Superfrau crafts rehydrating recovery beverages from fresh whey, an ingredient naturally rich in electrolytes and vitamin B12.
Synapse is a line of ready-to-drink beverages harnessing naturally sourced nootropics to boost cognitive performance.
Many of these companies also put sustainability front and center, developing innovative supply chains and packaging technologies. Spudsy upcycles imperfect sweet potatoes, working with farmers in North Carolina to recover ugly spuds that would otherwise go unsold; it hopes to salvage a million sweet potatoes this year. Superfrau aims to make the dairy industry more sustainable, by partnering with cheese and yogurt makers to turn leftover whey into a functional superfood. MudLrk uses proprietary compostable packaging, made without petroleum-based materials.
Ashley Rogers, founder and CEO of Spudsy, anticipates that her time in PepsiCo’s Greenhouse Accelerator will help take her company to the next level. “We’re a small team,” she says, with only four full-time people on staff. Developing strategies to succeed at a range of different national retailers can be a challenge. “I’m excited to work with these experienced people who can be a sounding board, and help us hone in on what’s important.” She is also looking forward to swapping knowledge with the other Accelerator participants.
The benefits flow both ways. Daniel Grubbs, who heads PepsiCo’s Ventures group and helped design the Greenhouse Accelerator, sees the program as a way of cultivating a vibrant consumer marketplace — which benefits companies large and small. The grant money, he tells me, is awarded with no strings attached. Although the company may eventually take a stake in some of these start-ups, PepsiCo does not disclose its equity investments.
PepsiCo’s Greenhouse Accelerator is an example of an institution that has become increasingly prevalent in the CPG landscape. In the past five years, big food and beverage companies — including some of the most venerable legacy brands – have taken a page from the tech industry, launching venture funds, incubators, and accelerator programs. Rather than enduring disruption and watching tiny, nimble start-ups gobble their market share, large companies are nurturing the disruptors — and gaining insights into emerging market areas, and new ways of engaging with consumers.
“From a PepsiCo perspective,” says Grubbs, “we are humble enough to say that great ideas can come from a lot of different places.” Last year’s recipient of the $100,000 prize was Hapi Drinks, an Austin-Texas based company that creates sugar-free flavored waters for kids – with a goal of reducing childhood obesity. Karsten Isdal, the company’s CEO, credits the Greenhouse Accelerator with helping Hapi Drinks successfully scale its business during a crucial period of growth. “Having that mentorship as we took on large accounts like Walmart, Harris Teeter, and Amazon was really, really helpful,” he says. At the outset of the Greenhouse program, Hapi Drinks could be found in around 500 stores; the company’s products can now be found in 2,600 stores, and Isdal anticipates that they will be available nationally by the end of this year.
As for Rogers, of Spudsy, her ambitions are also large. “I want to build something massive,” she says. “I want to Spudsy a household name.” And then, she laughs, “I’d like to be acquired for hundreds of millions of dollars.”