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The coronavirus outbreak fundamentally changed how consumers source their food, rapidly accelerating the adoption of online grocery shopping, digital takeout and delivery apps, and ghost kitchens. While these trends have slowed in Q4, they're still far above pre-pandemic levels. The shift to digital has begun, and there's no going back.
Increasing demand for alternative proteins has also driven more capital into lab-grown meat startups, which raised over $383 million in 2020, and the regulatory approval of Eat Just's cultivated chicken nuggets is a watershed moment. Other key takeaways include:
• Foodtech companies raised $4.0 billion in Q4, ending the year with a collective $18.1 billion in venture capital.
• Funding for cultivated agriculture companies is expected to rapidly accelerate in 2021, after reaching a record $1.6 billion last year. At scale, cultivated agriculture has the potential to produce high-quality, safe (e.g., no hormones, antibiotics, or diseases) meat and dairy products at a fraction of the cost of current meat production.
• Consumer demand is driving more investment in plant-based meat & dairy. The burgeoning industry is expected to achieve annual growth rates in the 20% range and an industry revenue of roughly $3.3 billion in the US.
• The massive surge in online grocery shopping has fueled investments in tech and support infrastructure that will feed additional adoption.