From Fast Food Nation to Pro Food Ventures

In 2001, Houghton Mifflin Company
published a book by Eric Schlosser titled Fast Food Nation
-The Dark Side of the All-American Meal.
Much like the work of Upton Sinclair in his 1906 title The Jungle, Mr. Schlosser, an award-winning investigative
journalist exposed how the explosive growth of fast food in America
had "hastened the malling of our landscape, widened the chasm between
rich and poor, fueled an epidemic of obesity, and propelled American
cultural imperialism abroad."

For a handful of people, this
book provided enough incentive to act, but nowhere near the critical
mass needed to show up on most radar screens. That started to change
with Michael Pollan's The Omnivore's
Dilemma, published
in 2006 and the 2009 release of Food, Inc., a food documentary incorporating
much of the work of Schlosser and Pollan. Still, unless you were seeking
out information on America's industrial food system, and specifically
how it was negatively impacting health, regional economies, and the
environment or global trade, you probably had no idea that there were
significant problems with America's abundant food system.

TIME Magazine changed that
with its August 21, 2009 cover story titled Getting Real
About the High Price of Cheap Food.
TIME brought the story of industrial food to mainstream America through
its 40 million readers and Web users worldwide. As America's most
trusted new source, it shifted the balance of the debate about our need
to reform our food system toward the sustainable food advocates that
have been waging a noble, but slow campaign. Here are some highlights
from TIME describing how ripe the time is for innovations in how we
grow, sell and prepare food in America:

• "...our energy-intensive
  food system uses 19% of U.S. fossil fuels, more than any other sector
  of the economy."
• "And perhaps
  worst of all, our food is increasingly bad for us, even dangerous."
  * "...obesity adds $147 billion a year to our doctor bills."
• "With the exhaustion
  of the soil, the impact of global warming and the inevitably rising
  price of oil - which will affect everything from fertilizer to supermarket
  electricity bills - our industrial style of food production will end
  sooner or later."
• "...quantity
  of fertilizer is flat-out scary: more than 10 million tons for corn
  alone - and nearly 23 million for all crops."
• "...about 70%
  of antimicrobial drugs used in America are given not to people but to
  animals, which means we're breeding more of those deadly organisms
  every day."

When you consider this was
presented to at least 40 million Americans, a vast majority who don't
know where their food comes from, you get a sense of how this single
article will likely impact the evolution of sustainable food. The TIME
article's author specifically states, "So what will it take for
sustainable food production to spread? It's clear that scaling up
must begin with a sort of scaling down - a distributed system
of many local or regional food producers as opposed to just a few massive
ones."

As sustainable food discussions
move into the mainstream, so will the opportunities for entrepreneurs
and existing companies to bring to market innovative approaches to selling
higher quality, healthier foods to increasing percentages of consumers,
businesses and institutions. As these companies grow, they have an increasingly
realistic chance to break the near death grip that industrial food has
put on America's food system:

• Seed Companies:
  What was once a highly diversified, regional industry is now controlled primarily by pharmaceutical and chemical
  companies, including Monsanto, Dupont and Syngenta.
• Farms: According
  to the USDA, "Small farms, while numerous, account for less than 2%
  of all U.S. farmland, while large farms account for 67%. Consequently,
  the growth in the number of large farms has increased the concentration
  of crop production."
• Meat Packers:
  According to Sustainable
  Table, four companies
  controlled processing of >80% of country's beef and three of these
  same four companies joined a 4^th in processing >60% of
  country's pork. Four major companies in broiler chicken processing
  provide >50% of our chicken supply. Same for turkey meat.
• Food Processors:
  The Top
  50 U.S. processors
  accounted for $326 billion or ~25 percent of the global market. Add
  in European giants like Unilever, Nestle, Cadbury Schwebbs, Danone,
  etc., and you fast approach a majority of the market.
• Food Retailers:
  Wal-Mart is at top of the heap with nearly $100 billion in food sales.
  The next 49 companies all report income over $1.0 billion dollars.
  On global scale, the USDA reports "Top 15 global supermarket
  companies account for >30% of sales."

There are already examples
of sustainable food innovations throughout the food chain, from Will
Allen's Growing Power to an alliance between Good Natured Family
Farms and Ball
Food Stores, to name a few. Early pioneers, with dirt on their hands,
lessons learned and progress made, played a critical role in blazing
trails for new ventures. Some of those companies have grown dramatically,
e.g., Green Mountain Coffee Roasters (NASDAQ: GMCR; market cap of ~$2.5
billion). Others have been acquired by larger companies, e.g., Stonyfield
Yogurt (acquired by Groupe Danone), Ben & Jerry's (Unilever),
Burt's Bees (The Clorox Company). Still others have remained independent.

The next wave of ProFood start-ups will have the advantage
of leveraging the many lessons learned by these pioneers. Unlike earlier
sustainable food entrepreneurs, this next-generation will also have
the benefit of a growing number of mission-driven investors showing
up sustainable food conferences, e.g., Slow Money Alliance and New Seed Advisors, looking to drive sustainable food
forward.