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7 Questions with Tyson Foods’ Head of Strategy McGurk About New Venture Fund

December 9, 2016

Earlier this week US meat producer and brand Tyson Foods hit the headlines for launching a dedicated venture capital investment arm Tyson New Ventures. Tyson is the latest in a growing number of food companies with venture capital funds.

Tyson New Ventures will invest in three main areas: alternative proteins; companies tackling food insecurity and food waste; and digital tools to grow and track food, ensure food safety and promote consumer empowerment in the food chain. And it will be run by Mary Kay James, ex-head of venture capital at global agribusiness DuPont.

The fund’s first investment is Beyond Meat, which Tyson invested in earlier this year before the fund launched.

We caught up with Tyson’s head of strategy and new ventures Monica McGurk to find out more about the decision to launch the fund.

Had Tyson made any investments in startups before Beyond Meat?

This will have been before my time at Tyson, but we have previously invested in ventures as diverse as emerging food brands, renewable energy and pet treats – including the incubation of our high growth new brands, Nudges and True Chews. But as a strategic focus, venturing is new as is the scale of our intent, and the clarity with which we see this space being additive to the tremendous growth we’re seeing in our core businesses.

Why did you decide to launch a fund and how long has it taken to get up and running?

The role I came into at Tyson as head of new ventures was quite an open space. There was a lot of enthusiasm to build on the great innovation efforts in the company. Donnie Smith [CEO of Tyson] and Tom Hayes {president and incoming CEO] have been champions from the beginning, but what it would be was quite open, and we’ve spent the last few months thinking about what success looks like and not wanting to become a me-too fund.

We have been learning from corporate venture capital (CVC) funds and general venture capital funds about agility and partnering with entrepreneurs to be thoughtful and value-added investment partners.

Will Beyond Meat be managed by the VC fund?

Yes, we transferred that investment into the fund. It was a matter of timing, really, as Beyond Meat was ready before the fund was so that investment was always intended for the fund.

Do you envision placing more of a focus on any of the three areas you’ve identified for investments?

Not necessarily. We will consider an individual deal on the basis of its merit, its business model, sustainability, cultural fit within our team and company, and whether we think we can bring unique capabilities to bear to accelerate the company’s growth rate and increase the odds of its success. There might be a circumstance where we invest more in one area than another, but our intent is to look across all three.

How much access will startups have to Tyson Corp?

How I think about any portfolio companies having access to Tyson is that they will first be mediated by the experts in Mary Kay James’ team (Tyson New Ventures), which will include a business development arm that will develop relationships with the entrepreneurs, and which will be rounded out by a team of deep experts within Tyson representing functional capabilities where we believe we can add value – for example, chill chain distribution. On the other hand, based on the stage of development of the companies, it might not be appropriate for us to talk about scale and distribution with an early stage concept. Before we would open up the toy box of distribution and get everyone excited, we want to make sure we’ve worked with experts on marketing, communications and consumer insights to be sure they’re ready to scale.

What processes do you want to optimize internally where you see tech playing a role?

I wouldn’t want to talk publicly about this specifically, but we are constantly scanning for external tech and expertise that can improve how we work internally.

Is the idea that you will acquire some of the startups eventually? Do the investments need to have some potential for that?

It could be an outcome for their exit to come into the Tyson family but that’s not the exclusive exit path; we understand from the entrepreneur’s standpoint optionality is valued, so we will take it on a case-by-case basis and see if that’s the best outcome for all parties.

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