Foodie start ups are outnumbering new technology businesses in 2015
A new generation of food and drink entrepreneurs is powering a ‘foodie revolution’ in the UK, driven by strong demand for organic, seasonal British food and the growing trend for food stalls, pop ups and supper clubs. Produce Business UK finds out more about the start-ups using fresh fruits and vegetables in particular
Start-up business funder Startup Direct has seen a 17% increase in enquiries from food and drink entrepreneurs during the first four months of 2015, compared with the same period last year. As a result in this surge, food entrepreneurs now make more enquiries about start-up funding than any other sector, including technology.
UK consumer demand for high quality, niche food and drink products is encouraging entrepreneurs to follow their dreams and start their own food business. The street food trend in particular offers a golden opportunity for budding food entrepreneurs to bring their products to an eager audience at a fraction of the cost of opening a restaurant or shop. They can test their product in a live environment and hone it as they go along. It also enables new food brands to build up an engaged local following before stumping up the cash for marketing and mass production.
“People think of technology entrepreneurs as the driving force of the UK’s start up scene, but in fact it’s the foodie start ups who are bringing home the bacon in 2015,” explains James Pattison, CEO of Startup Direct, a partner of the government’s Start Up Loans scheme, which offers loans of up to £25,000 at low interest rates (6.2% APR) over one to five years.
“They are passionate about the quality and provenance of their products and are comfortable delivering it in pop ups or on the street,” adds Pattison who says as well as their own business mentor, entrepreneurs involved with Startup Direct also have access to workshops, networking events and a business helpline,” Pattison says.
“Today’s generation of twenty somethings are short of money but prioritise eating out, so there’s a strong market out there for food businesses who have a sound business plan and can make the numbers stack up. Cutting their teeth in street food allows entrepreneurs to trial their concept and put together a rock solid case for investment which will enable them to take their business from a single street stall to a bona fide artisan food or drink brand.”
Case Study: Feed Me Primal
Feed Me Primal is the UK's only paleo food stall and its focus is on ethical meat, fresh produce and lots of big flavours. The paleo diet encourages followers to eat lots of seasonal vegetables to ensure you get as many vitamins and minerals as possible, and eating locally means there are less air miles and the food is much fresher.
Gemma Callander founded the innovative start-up in 2013 thanks in part to a loan from Start Up Direct, and her healthy, tasty food can be found at some of the best food markets and events in London.
"The meals I prepare are designed to give customers not just a delicious and satisfying meal, but a healthy and surprising experience too,” Callander points out. “By using British veg to create cauli-rice (a low-carb, veg alternative to rice), people discover new ways to cook veg and get more of it into their diet. It's particularly popular with parents trying to sneak more veg into their kids meals.”
As people become more aware of the impact their diet has on their health and well being, so more people are turning to paleo as a way to take control of their eating habits. Locally grown, seasonal veg is highly prized and Callander says Feed Me Primal is proud to support Britain's farmers.
Case Study: Taking the Pea
Mike Gallagher, an Aussie living in London and an apparent long-time ‘hater’ of peas, was inspired to develop a range of crunchy pea snacks after trying his first Wasabi pea. He set about founding Taking the Pea to offer healthy, protein and fibre-packed pea snacks in four familiar crisp flavours: Smoked Ham, Sweet Chilli Salsa, Cheesy Peasy & Onion and Wacky Wasabi.
Gallagher borrowed £7,000 from Startup Direct which he used for website development, packaging design and the first print run. Mike launched Taking the Pea in March 2015 at a few London independents and now has his product included in several monthly subscription boxes such as The Vegan Kind and Flavourly.
Mike says: “We’re in talks with some key wholesalers and are planning to go live later this summer, which will boost sales to a new level and give us the kind of distribution network we’re looking for. We’re really proud of the fact that our products will also be in sale in Selfridges in June, which helps tick the ‘proof of concept’ box that many retailers require before stocking a new brand.”
Case Study: Tico’s
Thiago Gomes had a dream to bring authentic Brazilian hot dogs to the streets of London. He was confident there would be a market for his quality hot dogs, or ‘salsichas’, cooked in his mother’s original fresh tomato sauce recipe, served fresh or toasted in a brioche bun with traditional Brazilian fillings and topped with melted parmesan and fresh oregano.
Thiago borrowed £4,900 from Startup Direct in order to develop his product, create a brand, design packaging, build a website and invest in machinery. There are now Tico’s Brazilian Street Food Stalls at the Sunday UpMarket in Brick Lane and Street Food Union Soho, with long-term plans for a restaurant chain.
“My stalls have given me the perfect opportunity to test my products, try out new things and find out what people like”, said Thiago. “I want to widen my appeal beyond hot dogs, so I’m now expanding my product range to include Brazilian snacks, pies, tapioca wraps and fruit juices.”