Exclusive: Nestlé invests in Latin American startups via partnership with the Yield Lab Latam

• In a move to support agrifoodtech startups in the region and bolster its own sustainability efforts, Nestlé is investing in VC firm the Yield Lab Latam (YLL).
• Nestlé will invest in YLL via its internal Sustainability Fund.
• The news comes just weeks after YLL announced the second close of its third fund on more than $20 million.

Why it matters:

For big CPGs — which are often associated with environmental destruction — achieving sustainability commitments often means partnering with younger, leaner startups with new technologies and processes.

YLL operates in four countries in Latin America, investing in early-stage agrifoodtech startups in the region. Its current portfolio includes 19 startups developing a range of technologies, from digital banks for farmers to irrigation management systems, grain trading platforms and remote monitoring, to name a few. The firm just announced the second close of its third fund on more than $20 million.

“We believe it is critical to create systemic change, and for this, we’ve helped build a powerful innovation network across the region,” YLL managing director Tomas Peña said at the time of the close. “This allows incumbents . . . to become agents of change by investing in our fund to create the necessary context for disruption of the food-producing value chains all over Latam.”

Nestlé will invest an undisclosed amount in YLL from its Sustainability Fund, which supports startups working in the circular economy and regenerative agriculture sectors.

The CPG has publicly committed to net zero emissions by 2050 and to halving absolute emissions by 2030, and says it is on track to meet these goals.

Elsewhere, Nestlé plans to “advance” regenerative agriculture by planting 20 million trees every year for the next 10 years,  says it has already planted 4.1 million trees across Latin America, and pledged to be deforestation free by 2025 (though a recent FAIRR report noted that Nestlé continues to use suppliers that don’t track deforestation). 

Last year, Nestlé announced a new R&D center in Santiago, Chile.

“The investment from Nestlé and the partnership with The Yield Lab LATAM will help us progress on finding sustainable solutions for the food industry,” Maxence de Royer, vice president of Strategy, Business Development & ESG for Nestlé Latin America Region, noted in a statement.

“Investing in technological innovation in the agri-food sector and drawing on the energy and creativity of start-ups can help meet common goals such as reducing emissions and increasing biodiversity. This complements our own research work in the area, for example through our new Institute of Agricultural Sciences.”