Startup Talk: Kellogg establishes $100 million startup fund to support growth initiatives

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KELLOGG ESTABLISHES $100 MILLION STARTUP FUND TO SUPPORT GROWTH INITIATIVES

Kellogg Company announced Monday (June 20) it is establishing “eighteen94 capital” (“1894”) to make minority investments in companies pursuing next-generation innovation, bolstering access to cutting-edge ideas and trends. The investment mandate includes start-up businesses pioneering new ingredients, foods, packaging, and enabling technology. 1894 will invest approximately $100 million in emerging businesses in both 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. It will also play an important role in achieving Kellogg’s 2020 strategic growth objectives, company officials said.

The fund will be managed by Simon Burton, managing director, a 10-year executive at Kellogg who also has extensive investment experience in the Consumer Products sector and with start-ups. In addition, Kellogg has partnered with Touchdown Ventures, which specializes in corporate venture capital, to assist with management of the fund.

BANK OF AMERICA SURVEY HIGHLIGHTS GROWING AMERICAN DEPENDENCY ON SMARTPHONES, SMART DEVICES

It appears the majority of Americans need a dose of reality when it comes to their own smartphone behaviors. A new survey released finds less than one in five (17%) adults believe they are on their mobile phone too much, while more than half (56%) believe other people are guilty of overuse. What’s more, just 10% consider themselves “tuned out to the world” while on their device, and 55% believe they mind their mobile manners. When asked about others’ behaviors, the numbers are nearly inverse at 50% and 18%, respectively.

These findings are part of the third annual Bank of America Trends in Consumer Mobility Report, a study that explores mobile trends and banking behaviors among adult consumers who own a smartphone and have an existing banking relationship at any financial institution.

The survey also found an ever-growing daily dependence on devices. In an average day, millennials (39%) cite they are most likely to interact with their smartphone more than anyone or anything else, including their significant other (27%). This increasing reliance is also visible in managing finances: Nearly half (48%) of Americans are constantly checking their finances via mobile, including account balances and budgets, compared to only 28% that report frequently checking health-related items, such as steps and calories.

DUN & BRADSTREET: SMALL BUSINESSES STILL HEAVILY DEPENDENT ON PERSONAL RESOURCES, DESPITE IMPROVED ACCESS TO CAPITAL

The ability of small businesses to access needed capital has steadily risen in the past four years, according to the second quarter results from the Private Capital Access (PCA) Index by Dun & Bradstreet and Pepperdine University Graziadio School of Business and Management. Despite this, the survey found that small businesses’ access to traditional bank loans, while increasing, still lags behind that of middle market companies, forcing small businesses to rely on personal assets and personal credit.

The study showed a 13% increase in access to capital for small businesses (revenues less than $5 million) since Q2 2012. The quarterly study also showed that in Q2 2016, personal funding sources appeared to be firmly entrenched as mainstream options for small businesses who accessed capital within the last three months.

Thirty-four percent of small business owners transferred personal assets to their business over the last three months, compared to just 13% of owners of mid-sized businesses (revenues between $5 million – $100 million). The leading types of personal assets small businesses relied on for capital were personal savings (72%), personal credit cards (45%), and cash from sale of personal assets (19%).