Campbell's cooking up $125 million for food start-ups
Campbell's Soup is rolling out a $125 million venture capital fund aimed at food startups.
The Camden-based company, which has been selling soups since 1869, is looking to diversify in a time when consumer tastes are moving toward fresher, organic offerings.
"Soup has become a smaller portion of their portfolio over time, so I think they know to grow they really need to innovate or purchase assets that are more on trend," said Bea Chiem, an analyst with Standard and Poor's.
Campbell's has acquired healthier food product lines in recent years, and with the venture fund, now hopes to get in on the ground floor of more startups that appeal to millennials.
Brian Weddington, an analyst with Moody's, says the company is following in the footsteps of other packaged food giants, which can use a venture funds to window shop for attractive mom-and-pop-sized business.
"These companies are really just trying to get an early look at new trends, new development, and potentially companies they may want to bring into the portfolio later on down the line," he said.
Both analysts say that $125 million is a small enough amount that even a few bad bets shouldn't impact the company's bottom line.
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