PepsiCo Expands Nutrition Greenhouse Startup Program to U.S.

PepsiCo is expanding its Nutrition Greenhouse program from Europe to North America, adding to its arsenal of initiatives designed to connect the global soda-maker to innovative startups in the food and beverage sector.

Nutrition Greenhouse will be an accelerator for 10 startups that “are helping to transform the food and beverage industry with nutritious, natural, and sustainable products,” Jim Andrew, executive vice president of corporate strategy and chief venturing officer, said in a press release.

The selected startups, from the U.S. and Canada, would receive $20,000 in grant funding and work with some of the company’s brands such as Quaker, Naked, Stacy’s, and others. Startups must have a “demonstrated consumer sales track record,” the company says, but no more than $5 million in annual sales. (The application deadline is Oct. 12.) The program runs from November to April next year, and includes kick-off at PepsiCo’s headquarters in Purchase, NY; a mid-term event at Frito-Lay’s home office in Plano, TX; and a graduation event in Chicago, where one company will be selected to receive an additional $100,000 to continue its partnership with PepsiCo.

Nutrition Greenhouse began in Europe last year, hosting eight startups that PepsiCo says had combined sales growth of more than 10 million euros, a fourfold increase during the six-month program.

That program’s expansion into the U.S. is the latest in a series of announcements detailing PepsiCo’s forays into seeking and supporting innovative products. In July, PepsiCo CEO Indra Nooyi started “The Hive,” a new business within the larger company that is focusing on nurturing emerging brands.

The Hive’s goal is to develop smaller brands within the company, such as Stubborn Soda and Maker Oats, while creating new brand ideas that would otherwise get lost in a billion-dollar, multi-national corporation.

“We want to create an environment where we have a business within a business, a small entrepreneurial sort of agile group that’s thinking about the new-age consumer that loves discovery [niche] brands, while allowing the big brands to thrive in the overall mothership,” Nooyi said in a recent earnings call, according to a transcript in Seeking Alpha.

PepsiCo is among a number of large food companies wanting to connect to young startups as a way to stay abreast of innovation within the sector and also get first dibs to any new products. The Chicago area has become a ground zero of sorts with “The Hatchery,” an effort by Conagra Brands and Kellogg; Springboard, an incubator funded by Kraft Heinz; and Tyson Foods’ innovation labs, each of which seeks to support young food and beverage companies. Meanwhile, New York is home to yogurt-maker Chobani’s food incubator as well as Pilotworks, a culinary incubator founded by Campbell Soup.

“Food entrepreneurs need a lot more than a few desks and fast Internet to start a business. We give them kitchens that are up to code, equipped with everything they need whether it’s dry storage or blast chillers,” Nick Devane, Pilotworks’ former CEO (who took on a broader strategic role in June), said in a CNBC article late last year. “And we help them market and distribute what they make.”

Angela Shah is the editor of Xconomy Texas. She can be reached at ashah@xconomy.com or (214) 793-5763. Follow @angelashah

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