What the Latest Round of Food Contamination Recalls Say About Ag Innovation

It’s happened again.

Last month, the United States Department of Agriculture announced a nationwide recall of more than 12 million pounds of raw beef due to new concerns over possible salmonella contamination.

The move was an expansion of an October recall related to beef that has so far sickened nearly 250 people in 26 states.

Per a story on the recall:

“While most individuals who contract salmonella recover without treatment, the bacteria is particularly dangerous in children, the elderly and people with weakened immune systems. Symptoms develop between 12 to 72 hours after eating a contaminated substance and include diarrhea, abdominal cramps and fever. They usually last between four to seven days.

“The affected products were packed on various dates between July 26 and Sept. 7 by JBS Tolleson, an Arizona-based beef processing plant that ships nationwide. The specific products subject to recall are stamped with “EST. 267” within the USDA mark of inspection, the agency says.”

Read the story

First it was Chipotle. Then it was cantaloupe. Then it was romaine lettuce. Now this. Will the endless train of food contamination issue ever end?

In a word, no.

Not if nothing changes in the way the agriculture and food preparation industries handle and store food. Because the modern system is simply not prepared to handle outbreaks like this and not equipped to prevent them from happening.

As the CDC and other government agencies have stepped up both the monitoring of outbreaks as well as the enforcement of food safety infractions by food service companies, foodborne illness incidents have ticked up in recent years, in large part because we are paying much closer attention to them.

This effort dates back to 2011, when the Food and Drug Administration (FDA) Food Safety Modernization Act was signed into law, granting the FDA an array of new powers, including mandatory recall authority, and placing significant responsibilities on farmers and food processors to prevent foodborne illness contamination.

That’s the bad news.

The good news is that there are a number of smart, driven entrepreneurs who are working on this problem right now.

One example is ProteoSense, which has been commercializing a new solid-state biosensor technology for food safety testing that’s based on work originally done by scientists at Ohio State University and Cleveland State University.

The company’s RapidScan technology is a high-sensitivity, portable system that can detect foodborne pathogens in just minutes without incubation, reducing the overall total test time and allowing for on-the-fly testing by current personnel in the field or the factory.

Currently designed to test for Salmonella, Campylobacter, E. coli, and Listeria, the RapidScan system allows growers, packers, processors, shippers, and wholesalers to test produce or meat products for pathogens multiple times throughout the supply chain – in the field, from cartons at shipping points, in packaging facilities, etc. – and get immediate results. And it’s easy to use, designed for in-field testing by non-technical employees, eliminating the need to send test samples off to a lab or wait for results.

The goal, the company says, is to accurately detect foodborne pathogens automatically, in real-time, to quickly identify hazards at the front end of the supply chain rather than forcing producers to react after a contamination has occurred in an attempt to contain the risk.

Learn more about ProteoSense and its RapidScan technology.

Consideration

With 2021 well underway and with public markets still strong, we think it is an important time to highlight some of the key private market, venture investment themes that iSelect fund has identified for the year. We believe technologies transforming the Agriculture, Food and Wellness markets will flourish, with a focus on four areas: technologies that enable better food choices to drive better health outcomes, technologies that drive better, more profitable farm operations, technologies that drive the Consumerization of Healthcare, and biome-based treatment technologies. At iSelect, we invest for impact AND performance. We offer qualified investors access to emerging growth companies through our national venture capital strategy. Our unique structure allows our investors to continue to invest in these companies as they develop.

Timing

Why is now the right time for venture? The answer is that now is not explicitly the right time. Venture is something we need in our economy at all times. Now is not better than any other particular time. The question is, why ever stop? When we look at the challenges we’re facing in food and healthcare the reality is there is someone, somewhere who has an insight about how to build a product that will solve those problems. And if they put the right resources to it, they will succeed. As long as we need new technology to make life better or make our lives more enjoyable, we need venture capital to help fuel those entrepreneurs.

What is iSelect as a product?

iSelect is a very unique product, but when you break it into its parts it’s fairly easy to understand. On the front end we’re a traditional venture capital fund. We have a diligence process. We have an investment process. We have categories of industries where we have focus and real expertise, and we invest in companies in those areas that meet requirements for the fund. On the back end we’re unique in that we don’t raise a large amount of capital at one time and deploy it over the life of our fund. Each deal that we bring onto the fund, our investors have to prove and determine to invest in that deal. We have to constantly prove our diligence standards. It’s accessible, transparent and easy for investors to come in and see our comprehensive process.

What is the ideal iSelect company?

We are looking for founders that are passionate and we want the problem they’re trying to solve to be big, real, and painful. We want the solution to be revolutionary and we want our capital to be able to help them solve that problem. We want to know that they have customers involved and that the solution they’ve come up with actually meets those customers’ and market needs. And we want the team to be capital efficient with the money they’re spending.

What does the ideal iSelect company look like?

We’re looking for a company that has an opportunity to have a 10x return to our investment or greater in a period of three to seven years. What excites us at iSelect are companies that are solving big problems. We want companies that are going to be the Monsantos of the future. Not just in the size and the scope, but the impact they have on people’s lives. We want to create positive impacts on people’s lives, so we invest in areas like agricultural production and areas like producing healthy foods for our kids. They are problems that impact real people’s lives on a daily basis. That’s what we’re trying to do at iSelect. We’re trying to solve the big problems out there. Find ways to bring capital to the entrepreneurs who are the real heroes out there getting up every morning, beating away at these things that are problems that you and me and everyone else faces in their everyday lives.

What is iSelect?

iSelect is a venture capital firm. What that means is we look at hundreds and hundreds of different companies and we apply tough diligence standards to each of them, looking at whether the team has a good plan for growing the business, whether the team is qualified and credible, and more. We do that to resolve the few who provide the best opportunities for investors. And then iSelect takes that smaller set of investments and goes to investors who are interested in venture capital and provides a way for them to invest in these companies, either individually or all at once. We co-invest alongside other venture capitalists. We source transactions through to an exit where the company would become public or get bought. And we manage that whole investment process on behalf of our investors.