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future food

Future Food: How Whole Foods’ Walter Robb Thinks About Food Tech and The Future of Grocery

May 1, 2019

There’s perhaps no deal more representative of the changes taking place in the food system, and the meeting of technology and food, than Amazon’s acquisition of Whole Foods in 2017. A surprise move to many but one that solved particular challenges for both players: Amazon got access to a high-quality fresh food brand and supply chain, and Whole Foods became digitized.

Walter Robb, the former co-CEO of Whole Foods, was a key player through the transaction and for many years at Whole Foods before it.

A proponent of whole and natural foods, Robb is also increasingly exposed to new food technologies through his work as executive-in-residence at agrifood tech investment firm S2G Ventures, TPG’s the Rise Fund, and managing his own consultancy and personal portfolio through Stonewall Robb Advisors.

In this second edition of the Future Food podcast, I chat to Robb about his food preferences, his contrarian views of the plant-based meat trend, the role of big data in food, and how the Amazon deal came about — did you know Whole Foods was looking for a digital acquirer?

We also talk about his vision for the future of food and hopes of providing fresh food to underserved communities.

As an incredibly experienced food retailer with extensive knowledge and opinions on eating well, Robb’s take on the future of food and the development of new technologies is unique. It’s also essential listening for consumers thinking about new food tech trends, corporates wondering how to approach new innovation — he offers some specific advice here — and grocery-focused startups.

Below is a short excerpt from the Future Food podcast, which you can listen to below or on your favorite podcasting app.

LBT: If you think about want the future food system will look like in 2050, can you name two or three features that you think will be different from today?

We’re going to see technology and humanity joined together. We’re going to have this combination of the two work throughout the value chain in the food system. I imagine we’ll have robots and people working side-by-side on farms. Certainly in restaurants and supermarkets, the same will be the case.

I think we’ll also have the last mile of data; we’ll have information. The customers will have information through very sophisticated technology that will allow them to see exactly where their food was grown, how it was grown, when it was picked, et cetera. That will provide the customer with up-to-date information and real-time information on their choices.

I think we’ll also see a much greater variety of foods. You know, we only use 12 plants and five animals for 75% to 80% of our food now. We’re going to discover the full range of amazing plant life in the world and bring those into the food system because there’s so many undiscovered nutrients and values. We’re probably going to be using botanicals. Botanicals will outperform synthetics and we’ll be using those widely through this food system to grow food in more harmony with nature.

I think there’s going to be a movement to flavor, and whether it’s breeders or whether it’s in the seeds, or whether it’s in the customers’ appreciation, there’s going to be a true, true flavor coming through, and I’m going to make the case there’s still going to be soil around because we’re only now really appreciating and discovering the incredible complexity of biology and life that’s in the soil.

So, have we seen all these things? No, but are we seeing the beginnings of them? Yes, we’re seeing a few. If you go into the progressive supermarkets today and you are starting to see the fusion of digital, physical and everything between technology that’s enabling that and data. I see those things will continue to happen, towards greater accountability, transparency, and responsibility in the food system.

LBT: You told me earlier that you were thinking about how to digitize Whole Foods before the acquisition by Amazon. In what way?

Yeah, well any CEO or in the sweet seat of those sorts of responsibilities, you can see these megatrends around technology and data and customer choice, and five, six, seven years ago they were clear to me that we had to work on it. And yes, we did do a number of things including realizing that we probably couldn’t get into the delivery business, so we cut a deal with Instacart and helped them to grow out that business. It ultimately became a $600 million business for us; our customers clearly wanted those sorts of choices.

We also worked on upgrading every one of our enterprise-wide systems, on the front end and the back end to be able to offer the services our customers wanted based on their journeys through our systems and stores.

I very much think of technology as a capability that a cost better retailer has to be able to serve their customers the way they want to be served. We were certainly thinking about taking our stores and giving the customer that same experience in the digital world and the places in between, whether it was delivery or pick up in the store, etc. And we were on our way towards doing that; it’s just that the pace, the acceleration that was necessary to compete – joining with Amazon helped that to go much faster. And you can see Alibaba with their store Hema in China right now is a shining example of how to bring all those worlds together successfully. And you’re seeing the retailers that are winning in the US today; they’re the ones that can do that. The Targets of the world, the Walmarts of the world; they’re doing exactly these sorts of things.

LBT: What are your thoughts on robotic retail such as manless stores and robotic restaurants?

I think it’s part of the future. I think people are conjuring up things that these robots are going to show up tomorrow and run our lives and it’s just not going to happen. The robotics is not there yet to do it. But it is there like there’s a restaurant in Boston where they flip hamburgers. There are many grocery stores now where the robots go up and down and check aisle stock and support the team so that they can serve the customers better.

So I see a period of integration of robots and humans in the next couple of years, yet certainly there’s many distribution centers and factories where robots are doing that sort of work already. We know this all against the backdrop of tremendous displacement; work in America as we know it today will be displaced by technology and robots. Technology I’d say more so, in terms of systems and platforms, but I think these robots right now in the grocery business are providing a tremendous enhancement to productivity and in fact, will put the role of the team member human directly on the idea of the individual service and connection with the customer. So because we’re people, I don’t think that role ever goes away. We want connection and we want one another and we want to be places where that’s happening, and there’s just no technology sensitive for that. So I see it much more as a gaining of productivity and efficiency, a tremendous capability, but in the end, I hope it’s married with our desire for greater humanity at the same time, and I hope that the businesses will continue to remember that and invest in people.

LBT: Do you think plant-based meats are a hot trend?

Moderately. You have the Beyond Meat and the Impossible Burgers of the world which, you know Beyond Meat’s going to go public and Impossible Burger’s launched at McDonald’s, so it’s hot in that sense, but I personally, I’m not a fan of those. They’re made mostly from isolates, and I told you already, I’m a whole foods guy and I think they’re a little bit of a misdirect for people at times. If they want to eat a healthier diet, eat whole foods. But if they’re helping folks to think about all those things, that’s fine. So hot from some perspectives but from my perspective, not so hot.

Listen to the Future Food podcast to hear more about Robb’s views on alternative meat products, which other food trends he thinks are hot or not, his portfolio of investments, and what keeps him up at night.

Special thanks to Matt Newberg for his help in producing this podcast.

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