Food and ag startups face a host of unique challenges when raising growth capital. As large food and ag companies change how they approach innovation, startups are looking outside of traditional methods and exploring new capital raising strategies.
We met up with Rabobank’s Eric Hansen, one of our expert FoodBytes! mentors,to get his take and to talk about what sets startups apart.
Want to see 20 game-changing food and ag startups pitch to a full house of investors, executives and media? Snag your ticket to FoodBytes! SF on Thursday, March 16 for 20% off with the code FOODBYTES!
FoodBytes!: Tell us a bit about your role at Rabobank
Eric Hansen: I work in Global Client Solutions, a solutions-oriented group at Rabobank. Our group is focused on helping clients meet financing needs outside of traditional first lien bank loans. One of our areas of focus is working as a private placement agent to help innovative emerging private companies raise growth capital.
FB!: How do you work with food and ag startups?
EH: We serve as a placement agent. We help companies seeking capital with the following: (i) best position investor marketing materials to deliver key differentiating business model model points; (ii) develop a credible, assumption-based financial model; (iii) assemble supporting due diligence materials; (iv) approach the right set of financial and strategic investors; and (v) structure and negotiate the deal.
FB!: What do you look for when deciding which companies to work with?
EH: We look for a certain level of innovation combined with business traction. That can be measured in different ways, such as product innovation, customer references, revenue growth, regulatory approval, etc.
FB!: What do you see as the biggest challenge facing the food and ag industry?
EH: The question of how to approach innovation is a big challenge for the food and ag industry. We are seeing large branded food companies working hard to figure this out many different ways – through new venture strategies, refined R&D strategies and M&A efforts. Innovation is also key on the agriculture side, where farmers may be struggling with profitability but new emerging technologies to assist are either here today or just around the corner.
FB!: You were a mentor for FoodBytes! last year, can you share some of your highlights from the experience? And what are you looking forward to about participating in FoodBytes! SF?
EH: I worked with many of the FoodBytes! attendees last year to explore capital raising strategies. Many of the attendees had questions about family office funding versus traditional VCs. It was exciting to hear about new entrepreneurial strategies and the initial traction they experienced. I’m looking forward to hearing new ideas at the up and coming SF FoodBytes!
FB!: What makes San Francisco an ideal location for startup innovation?
EH: There’s no place like the Bay Area! It’s the worldwide hub for innovation, including both emerging companies and experienced venture investors.