Victor Friedberg on Investing in Food’s Next Big Ideas

As co-founder of S2G Ventures, one of the premier venture capital funds in the food business, Victor Friedberg was an early investor in Beyond Meat and other trailblazers focused on better-for-you eating.

Now, this industry leader in thought and action is excited about two new things: his founding of New Epoch Capital, a venture capital firm leveraging Friedberg’s take on the emerging Western consumer, and FoodShot Global, a nonprofit for overhauling an insecure worldwide food system.

“I think it’s all about nutrition now, about bringing together the agricultural system, the food ingredients system, the manufacturing, the supply chain, and the marketing of nutrition, and that will define the future of food,” says Friedberg. “Nutritional security will be the preeminent organizational principle for food and agriculture going forward, and that will be different than what’s defined as food security.”

Friedberg and two others founded S2G (Seed to Growth) in Chicago in 2014 and have spread the fund’s “soil to shelf” investments from agriculture to ingredients, infrastructure, food safety, restaurants, and CPG startups. S2G’s other early investments have included Future Meat Technologies, an Israeli cellular meat startup recently renamed Believer Meats; Apeel, creator of a plant-derived coating for produce; and Maple Hill Creamery, an organic dairy company.

Here’s what Friedberg has to say about his current ventures, his strategic approach to investing, and why the alt-meat industry is going to get back on track.

What’s the investment thesis for New Epoch Capital?

No one has been looking at things systematically in venture investing, at how to break down the future and understand the leverage points where investments can better align it. We can use systems thinking to make investments that take advantage of where growth is going to be and also at the same time de-risk those investments.

What’s an example of an investment stemming from “systems thinking”?

[S2G] invested in Sweetgreen, with great founders, a great product, and a relatively accessible price point: They were going to be poster children for millennial-driven, fast-casual restaurant transformation, and you could invest on that basis alone.

But if you think systematically, you come across constraints—not as reasons not to invest, but as reasons to invest. So, where were all of Sweetgreen’s local organic ingredients going to come from? There weren’t enough in the system. So we found a chicken company to invest in where 20 other companies would benefit too.

We did that also with organic leafy greens, where we invested in a vertical farming company called Shenandoah Growers. Then Sweetgreen invested in Spyce, a restaurant robotics company. So three other companies have benefited from a single investment using systems thinking.

You call Beyond Meat an early example of a systems-thinking philosophy. Why have the original alt-meat companies now struggled so much?

It was S2G’s first investment. It came from the conviction that everything in the system was going to change.

Beyond Meat created a sector that’s absolutely going to grow because it has to. That company created the industry, educated the consumer, and its 1.0 products filled the need the consumer had at the time.

[But] you have to create cleaner labels with healthier nutritional profiles. That’s not only doable, but there are companies entering the market around that, like Meati and Air Protein. An interrelated problem is that there was rapid growth of the market after Beyond Meat went public [shortly before] COVID, and the company was on fire because people were really focused on health, and meat processing was shutting down.

After COVID, everyone realized that overnight adoption wasn’t going to happen as fast as everyone thought. But no doubt Beyond Meat and Impossible Foods will respond, and this is an opportunity for new companies to grab the baton. You can’t look at it like, “Oh my God, this went off the rails,” or that it was hype that didn’t materialize. Everyone should take a breath. It will be OK.

What new investments excite you?

One is Digestiva, founded by one of the foremost enzymatic scientists. They’ve developed an ingredient for food that produces two-to-three times the regular protein absorption levels in your bloodstream. Applications could include for seniors, who find it more difficult to ingest protein, and it’s a life-and-death issue.

Another is a snack company called Rivalz that has developed a [savory] “stuffed” snack with a hard shell—it’s incredibly flavorful—that can be pizza-flavored or taco-flavored, and so on, and is stuffed with a pea protein–based filling that is packed with protein and fiber, and zero net carbs or sodium.

You say New Epoch is after the “emerging conscious consumer.” Who are they?

The food revolution started around efficacy, sustainability, traceability, and personalization. But now all of those things have become relatively mature attributes. My thesis is that the consumer is saying, “I don’t just want food to be that way. What happens when I buy my skin cream or shampoo or shirts?”

And FoodShot Global? What are you after there?

Nutritional security has vast implications for sustainability, farm management, genetics—the entire supply chain. I’m looking at companies that represent a better way to make us healthier through a better understanding of the food chain.