Conagra and Kellogg have invested $34mn in a start-up incubator in Chicago
Food giants Conagra Brands and Kellogg are joining the city of Chicago, non-profits, and investors, in creating a food start-up incubator called “The Hatchery.”
The 67,000 sq ft facility is expected to provide production space for around 75 businesses when it opens in November next year.
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It will have 56 private kitchens, a large shared kitchen, bulk storage and more available to start-ups in the food and beverage industry.
Roughly 80% of the startups the Hatchery are working with are in the snacking market segment.
The exact amount invested by Conagra and Kellogg’s is unknown but it is said to be a “significant amount.”
Kellogg’s said that the investment was a “mutually beneficially endeavour” because the food giant will “learn as much from them as they learn from us.”
They did not say whether they intend to invest in the companies that use the site.
Conagra also said that it would support the incubator “in various ways” as the facility is being built.
The two major investors will likely be able to get a look at products in development and will be one-step ahead should they hope to acquire new businesses and brands.
Furthermore, it will also allow Kellogg and Conagra to keep an eye on what trends are emerging in the consumer packaged goods industry, ensuring that their own research and development is on track.
A notable number of start-ups at ‘The Hatchery’ are focused on snack-based products, indicating the growing consumer trend of in-between meal eating and eating-on-the-go.
Food manufacturers are increasingly focusing on the snack segment of the market to boost sales.