I’m getting déjà vu: foodtech and the dot com crash

Editor’s Note: Johan Jörgensen is founder of Sweden FoodTech, a foodtech acceleration platform, and chairman of FundedByMe, one of Europe’s leading equity crowdfunding platforms. Jorgensen is the organizer of The Big Meet foodtech conference in Stockholm, which will take place this year between June 1 and 2. Join him — and his wonderfully whacky trousers — there!

Over the last year, we have seen a fierce and accelerating backlash against food tech. Meat and dairy alternative companies such as Beyond Meat and Oatly have tanked on the stock market, vertical farm IPOs have been canceled and the media has started to critically investigate claims and deliverables from the sector as a whole, not the least when it comes to health and sustainability. The outlook for 2023 looks gloomy. Food is all about price and none about development.

As one of the proselytes of food sector transformation – food tech is, after all, the transformation of the food sector through tech, data and innovation – I am not surprised by the backlash against the new protein alternatives or vertical farming concepts. The truth is that any period in time when money has been cheap has produced loads of me-too entrepreneurs, outlandish visions and valuations, as well as unsubstantiated claims that investors with more cash than knowledge inevitably fail to unveil. The backlash is as certain as death and taxes.

But the sobering light shone on the food tech sector has also produced an abundance of gleeful smirks from people in the old food system. Apparently, these newcomers to the noble world of food did not bring anything better to the table than what already had been produced by the incumbents.

I totally agree with the incumbents. I have looked at the ingredient lists and tasted loads of new protein products over more than a dozen years in food tech and so far nothing has matched the products they try to replace.

But they are getting better at a head-spinning pace. The same goes for the components of vertical farming. And everything else in food tech.

The smirk I see on the face of old food is, therefore, a total throwback to the 1990s, in the early days of the internet. Back then it was the telecommunications companies (often state-owned monopolies) along with all those who desperately wanted to keep the status quo for their business models, positions, or engrained thinking, that smirked when the fledgling internet sector was on its initial roller-coaster ride, the dot com bust.

The road to today’s digital world has been littered with similar bumps to those that the food tech sector is currently experiencing.

This brings us to the core word of this piece, which isn’t “backlash” but “déjà vu”.

Analogous to the development of the internet sector, there will come a day when alternative proteins are truly tastier, healthier, and more sustainable than meat and dairy. And when vertically-grown leafy greens and berries, tightly packed with nutrients, are so affordable and available that they start to replace the uniform grain diet of today. And when new services will move the power over food to digital layers. There will be multiple tipping points; old fortunes will be lost and new fortunes won. The only question is when and where?

Do keep in mind that:

1. The massive, ginormous problems of our current food system are still there and need to be addressed. They will be.
2. The dynamics and speed of change will just continue to increase, in spite of the current bump.

I have already put the current speed bump behind me. So has everybody else I respect in the foodtech sector. And so should you, whether you are in food tech or a part of old food. Happy New Year!

June 1-2 we host the Big Meet when the food players of the future from near and afar will gather in Stockholm for two days of talking, listening, connecting and eating. All around the next generation food system and all that will fill it: swedenfoodtech.com