Kill Your Darlings: Food and Beverage Business Evolution

Change

Some entrepreneurs are uncomfortable with their business idea or product evolving as their business develops. However, most entrepreneurs start out trying to implement one idea, only to get feedback from consumers that the real business opportunity is in a different product, category or maybe even a different business model.

Change can be difficult. Sometimes being willing to change means giving up a pet brand name because a different one better identifies the product’s purpose and story. If the product doesn’t stand out on the shelf and speak to the right consumer, the business making that product will not make money. In that case, being willing to change can mean the difference between the business’ life and death.

This flexibility is important to surviving in today’s competitive marketplace. Consumers are demanding healthier, transparently sourced food and beverage options, and the details of those preferences are evolving at a rapid pace. This is why more large food and beverage companies are rapidly purchasing stakes in brands that have proven themselves by swiftly adapting to those changing preferences.

As entrepreneurs develop new products and new business models, they are constantly learning what works and what doesn’t through rigorous testing with their target consumer. In this sense, change doesn’t have to mean compromising core values but rather recognizing that there are multiple paths to achieving the business’ goals of profitability and impact.

We’ve said before that execution matters more than your big, brilliant idea. Part of executing is being willing to let the business change and evolve when it makes business sense. Sometimes that means killing your darlings.


And now, our roundup of the best food and beverage finance news, events and resources from around the web…

Business Model Insights

Raising Capital

Raising Capital

  • Why Food Startups Need to Keep Profitability in Mind Right Now (Project Nosh) – “If you think you’ll need to raise money in the next six months to three years (who knows when the next recession will occur), it’d be wise to steer your ship toward the land of fundamentals: really strong gross margins, an imminent path towards profitability, scalable operating expenses, and capital efficiency. Those are the attributes that early stage investors placed more value on in the last recession. Many companies are raising money at valuations they’ll have a hard time supporting in their next round of financing, especially if the next round is during a recession, but perhaps even if it isn’t. Other companies don’t think they’ll need to raise more money in the future. That sounds like a nice utopia, but it’s often not the case for fast-growing CPG brands.”
  • What it takes to get funded in the Midwest (Venture Beat)
  • 10 Things to Know Before Applying for a Restaurant SBA Loan (Foodstart)

Wholesale Brands

CPG/National Brands

Grocery Store Produce Section

Market Trends

Ag Tech

Farming and AgTech

  • The 5 Food Production Risks Digital Ag Can Solve (AgFunder News) “Agtech is a risk management tool that’s relevant across the food chain, through the relationships between growers and processors, processors and retailers, retailers and consumers. Risk is about whether that which was promised will be delivered, and who bears that cost when it’s not. We’ve come to see the opportunities around digitizing agriculture as the strategic sharing of information between two parties to reduce risk, share risk, offload risk, or otherwise shift the division of costs and benefits in order to create a more functional food system.”
  • Why small, local, organic farms aren’t the key to fixing our food system (Washington Post)
  • AgriFood Tech Investing Report – MidYear 2017 (AgFunder)

Mergers And Acquisitions

Deals/M&A

FaB Wisconsin

Industry Events

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