Money Talks — Why Women Should Invest in Natural Foods

March 27, 2015

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Demystifies angel investing. Loves Big Data. #GoWomen

There is a substantial gender gap between those who make purchase decisions and those who make investment decisions. Although studies suggest that women account for over 70 percent of consumer purchases — 90 percent in the food category! — women make up only 20 percent of all angel investors. The category of food and consumer products presents a prime opportunity for women to angel invest.

Why should women consider this focus? Diana Lovett, founder of Cissé Trading Company, explains it this way: “It's been so valuable to me to have women investors since they are the end consumers of our products,” she says. “They are usually the ones baking for and with their kids. [They] can help me stay aware of new competitors, potential new retailers, and give me feedback on new product ideas because they are naturally using my category of products.” (Note: Barbara Clarke is an investor in Cissé Trading Company.)

Another reason to become a natural foods investor is that the need is there, meaning these companies are typically receptive to new investors. Having looked inside many startup food companies, I can tell you that getting a product on your local grocery store shelves is a long, difficult road, made even more difficult by limited access to capital. Natural food companies need investments to get off the ground.

Venture capital investment trends provide yet another reason to become an angel investor in natural foods startups. “Consumer packaged goods” is a challenging startup category. Though Venture capitalists have steadily increased their investments in the category over the past five years, traditionally, they are not particularly interested in investments in food without a substantial technology component. That’s why, according to Forbes, the large venture capitalists are going after every kind of delivery or subscription-based food company and not the actual food itself. The landscape in traditional natural food companies is still wide open for new investors.

So, what to do? Start with the products in your kitchen cabinet now. Have you discovered a new, perhaps locally-made product? Reach out to these companies, with the knowledge that food startups are remarkably approachable. Get involved with natural food industry events. New natural food companies often host tastings at local supermarkets or food shows. Unlike many trade shows, attending food shows can be very affordable. Just this month, the Natural Products Expo in Anaheim, California was open to attendees for a registration fee as low as $45 for a day pass!

If you are passionate about innovative food, whether it’s new market trends like quinoa, sustainable agriculture, or traceability of ingredients, you should consider angel investing in this area. For more natural foods investment inspiration, check out this great post by Seth Goldman, TeaEO of Honest Tea, which outlines what a natural food company needs to do to be successful.

Barbara Clarke is a member of the DailyWorth Connect Program. Read more about the program here. She is also an angel investor in DailyWorth. You can find a full list of Clarke's angel investments here.

This article is not investment advice, nor is it a solicitation to buy or sell any shares.