In the 19th and early 20th centuries, city grew into the keystone for the nation’s industrialized food system through processing. Former fixtures such as the stockyards and its massive meatpacking plants are long gone, yet Chicago remains a center for big food companies such as Mondelēz, Kraft/Heinz, Mars Wrigley, Kellogg’s, Quaker, Conagra, Kerry, Ingredion, Lifeway, and others that have corporate, regional or division headquarters in and around the city.
Over the past two decades and more, there has been a sharp rise in consumer demand for healthier foods produced sustainably and humanely. And Chicago’s food sector has entered a new phase, with a growing ecosystem of companies, emerging brands, innovative retailers, investors and venture capital, service providers and non-profits, all dedicated to building a better-for-people, better-for-the-planet food system.
As managing director of Naturally Chicago — the association for natural and organic food companies in the region — I get to work firsthand with nearly 300 of the companies growing the Good Food and natural products industry.
In recent years, this sector has witnessed some impressive exits as larger companies purchased Vital Proteins (Nestlé, for $1.5 billion), RXBar (Kellogg’s, $660 million), Factor (HelloFresh, $277 million), Frontera Foods (Conagra, $109 million) and others. These buyouts have produced great returns for their founders and investors.
In addition, Farmer’s Fridge, Chomps, Simple Mills and other food companies are continuing to grow, employ locals and prepare for their next phase as an exit or a publicly traded company. And new retail concepts such as Foxtrot, Dom’s Kitchen & Market and Crafty are also on the leading edge.
Last month World Business Chicago hosted its second Chicago Venture Summit: Future of Food. This sold-out event brought together more than 1,100 food leaders from the region and across the nation to build relationships and grow new opportunities to invest in Chicago’s thriving food industry. The summit featured leaders from big food, emerging brands, investors, service providers and more, all committed to follow World Business Chicago CEO Michael Fassnacht’s directive to grow Chicago as the U.S. capital of food.
Naturally Chicago and the Food Foundry both hosted events on Day 1 of the Summit, linking investors with emerging brands. As the producer of a Pitch Slam and Financing & Innovation Forum since 2009, I will say that this year’s was the best yet. A standing room only crowd witnessed 10 brands seeking capital from dozens of investors and vying for more than $200,000 in prizes.
We heard from five of Chicago’s leading venture capitalists who are investing in early-stage food companies. Leaders from Mondelēz, S2G Ventures, Cleveland Avenue, Bluestein Ventures, and Supply Change Capital spoke about the challenges and opportunities in food. Most of these investors have put their money behind women-owned and minority-owned businesses and express a desire to grow their impact-investing portfolios.
Naturally Chicago also introduced our new Locally Made program. With lead funding from the Steans Family Foundation, we are launching a retail access and mentoring partnership with KeHE, the Naperville-based, employee-owned B Corp that is the primary natural, organic, specialty, and fresh product distributor to many Chicago area supermarkets plus thousands of other retail locations across the country.
This groundbreaking initiative is designed to connect Illinois’ vibrant retailer community with the region’s top-performing and emerging Natural Products brands. The program gives retailers a plug-and-play program to procure and promote local brands and meet the desires of their customers to buy and support local. Brands that participate in the program may be featured in point-of-sale promotions highlighting Locally Made. Numerous retailers and brands have already joined the program and we expect it to be a major growth engine for local companies—especially women and minority owned businesses—to thrive.
Other non-profit programs such as the Hatchery Chicago food business incubator and the Good Food Accelerator, both based in East Garfield Park, and The Plant, in the South Side Back of the Yards neighborhood, are working with early-stage entrepreneurs to help them hone their skills and grow their businesses.
Chicago is also home to many of the top programs that promote food access and education that encourages residents to eat better food to liver healthier lives. Large philanthropists like Builders Initiative, Searle Funds at the Chicago Community Trust, Blue Cross and Blue Shield of Illinois, The Lumpkin Family Foundation, and Tom and Margot Pritzker are investing tens of millions of dollars annually to support non-profit innovators focusing on food access and promoting better health.
Feeding America, one of the nation’s biggest food assistance organizations, is based here. The Greater Chicago Food Depository links food pantries, shelters, soup kitchens and other programs with donated or purchased food with a focus on fresh, healthy options; Nourishing Hope, which also provides food assistance, offers therapeutic services for those in need who face mental health challenges. The Good Food Catalyst and its Good Food is Good Medicine program partner with University of Chicago Medicine and other educators to teach healthy cooking at home.
Chicago has a growing sector of urban farms, community and school gardens, composting projects, and non-profit organizations similarly dedicated to a better food system and spreading the word to neighborhoods throughout the city. Many of these advocates, such as Urban Growers Collective, Growing Home, Star Farm, Gardeneers, and Pilot Light are working in under-resourced communities on the South and West sides.
And finally, let’s not forget that Chicago is one of the world’s culinary capitals and includes many pioneers in the farm-to-table movement such as Rick Bayless, Paul Kahan, Stephanie Izard, Beverly Kim, Sarah Gruenberg, Danny Grant, Jason Hammel, Matthias Merges, Chris Pandel, Jonathan Sawyer, Sarah Stegner, Debbie Gold, Joe Flamm, Greg Wade, John and Karen Shields, Andrew Zimmerman, Joe Frillman and more. It is not an accident that the James Beard Foundation Awards (the Oscars of the restaurant industry) will again be held at the Lyric Opera House on June 5. And our culinary community stands out for its generosity in raising money for those in need through a partnership with the Evolved Network.
Chicago is truly the hub of the food industry in America. We urge Mayor Johnson — who has pledged to address the root causes of crime and other social ills — to recognize the important role that food can play in creating well-paying jobs, promoting health and economic development, and restoring opportunity to these communities with healthier and more sustainable food choices and businesses.
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