BATTLE CREEK, Mich. -- The Kellogg Co. is establishing eighteen94 capital (1894), a venture-capital fund that will make $100 million in minority investments in companies pursuing next-generation innovation, bolstering access to new ideas and trends, according to Kellogg. The investment mandate includes startup businesses pioneering new ingredients, foods, packaging and enabling technology in consumer packaged goods (CPG) categories.
"As consumer preferences move toward more diverse tastes and trends, the pace of innovation in the packaged-food industry continues to intensify," said Gary Pilnick, vice chairman of Kellogg Co. "By investing directly in the most promising entrepreneurs and ventures, we can increase greatly our access to game-changing ideas and trends that could become significant sources of growth for us. At the same time, we will be providing these companies with essential growth capital and access to Kellogg resources and expertise, which will help drive their ideas and businesses."
The fund will invest in emerging businesses in Kellogg's core categories and adjacent categories, and in companies that have developed new consumer-driven technologies that could lead to long-term, mutual growth opportunities. While stage agnostic, the fund will emphasize early-stage opportunities with companies that have demonstrated good product and market fit and have generated initial revenue, the company said.
The fund takes its name from the fact that Dr. John Harvey Kellogg and Will Keith Kellogg invented flaked cereal in 1894, according to the company's website.
Simon Burton, a 10-year executive with Kellogg who also has extensive investment experience in the consumer products sector and with startups, will be managing director of 1894. In addition, Kellogg has partnered with Touchdown Ventures, which specializes in corporate venture capital, to assist with management of the fund.
"We want to help take our partners' innovative spirit and passion as far as they can go," said Burton. "We want to help create the ideal conditions for growth; that's why we believe that 1894 will become the destination for ideas."
With 2015 sales of $13.5 billion and more than 1,600 foods, Battle Creek, Mich.-based Kellogg is the world's leading cereal company; second-largest producer of cookies, crackers and savory snacks; and a leading North American frozen-foods company. Its brands include Kellogg's, Keebler, Special K, Pringles, Kellogg's Frosted Flakes, Pop-Tarts, Kellogg's Corn Flakes, Rice Krispies, Cheez-It, Eggo, Mini-Wheats and more.
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