How investment in food tech can smooth the transition to a low-carbon future
Our growing population places ever more strain on our planet and we are caught in a negative feedback loop. Every human needs to eat, but providing food contributes significantly to climate change. The food chains we have built up over centuries are a major accelerator to the climate crisis, as well as related factors such as ocean degradation and biodiversity loss. One-third of all human-caused greenhouse gas emissions come from food systems, according to a study in Nature, most of which are from agriculture and land use. Every vegetable we grow, and every animal we farm for slaughter, has the potential to add to the total emissions that end up damaging our planet.
It’s a problem that Björn Witte recognises. “If we don’t change that there’s no future for the planet because already today we take up 66% of land available to feed animals. I believe that we’ve been neglecting that for the past 20 years significantly.”
He is the managing partner and CEO of Blue Horizon, a Zürich-based impact investment firm that attempts to generate returns while creating meaningful, lasting change by supporting sustainable food businesses and manufacturers. The B2B investor in ESG (environmental, social and governance) companies hopes that his backings can kickstart a fundamental change: “Blue Horizon’s core mission is to expedite the transition to a sustainable food system”. The team of 30 scientists, entrepreneurs and investors are based in offices in Switzerland and the UK, with plans to expand to Singapore.
Witte’s focus is less on buying individual brands or product lines in sustainable food products, and more on building stakes in new technologies and manufacturing processes for the rapidly growing industry as a whole. “We look at technologies, understand how they can be scaled up and make very early investments,” he elaborates. “We do classic asset management seed venture growth and, if we see opportunities, we also buy out companies and help them operationally succeed.” Among the more than 70 investments that Blue Horizon has made to date include supporting the burgeoning plant-based protein market, which was worth $29.4 billion in 2020 and is set to multiply by more than 400 per cent to $162 billion by 2030, according to Bloomberg.
Like many ESG-related plays, doors are opening to investments in alternative protein companies through the pace of change in regulation. Late in 2022 the US Food and Drug Administration approved the production of cell-based meat components, with one alternative-proteins business. “We were expecting this only to happen [in 2023], but it was pulled forward,” says Witte. “I think it’s a really exciting thing to see.”
In what is in any case a rapidly expanding and immature industry sector, measuring environmental returns as well as financial ones can be tricky. To pinpoint worthwhile investments, Blue Horizon uses a methodology called IQRR (Impact Quality Rate of Return) in which an investment can be calculated against a baseline of whatever the investor chooses, such as carbon emissions. The financial and the impact side are both measured to ensure that the investor has an effect on both levels.
Blue Horizon buys in early in a product or company’s lifecycle; while riskier than investing in established companies, he claims that it maximises potential upside and also allows the greatest green impact. “Our strategy is to say what is very early [stage], which will have an impact in five to six years,” Witte explains. By building out a well-connected network, Witte asserts he can remain ahead of the curve in terms of data and knowledge bank.
He states his firm fields thousands of inbound pitches a year from companies convinced they have the food technology of the future. Blue Horizon relies on its in-house scientists and technologists to conduct detailed analysis of potential investments, including rigorous probing of the science and environmental claims underpinning their businesses.
The enterprise saw a hundred per cent year-on-year growth in the past two years, doubling its staff base, while raising money that will help further accelerate the transition to a sustainable food system. The company advises the German Federal government on their most recent commitment to promote and advocate for alt-proteins. Investors include family offices and institutions.
Witte’s also keen to ensure that Blue Horizon knows – and loves – all the companies it invests in. “We see the products, we can taste them.”
Biography / Key highlights
2010 Begins as CEO of Desai AgriFoods, a fruit producer and exporter, working between India and Switzerland
2012 Commences strategic freelance project work in the food tech and food ingredients industry
2014 Becomes CEO of Dr Förster, a natural cosmetics and dietary supplements brand
2018 Starts as managing partner and CEO at Blue Horizon
2019 Co-founds the Livekindly Collective of plant-based startup brands as CEO and president