S2G Ventures Healing America – A Future Food System for our Farmers, Consumers and Planet © 2021 Seed 2 Growth S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet A Food System that Heals – Our Country, People, and Planet Everybody eats. This simple truth positions the food system to solve complicated problems – from bridging the urban and rural divide in the United States to providing profitable solutions to addressing climate change. It can also help to build a more resilient, hea lthy population, which is paramount in the times of a public health crisis. COUNTRY PEOPLE PLANET Everyone Eats Eating Climate Change Soil Health… and Wealth 800k+ 4x 100mm Jobs added during COVID from grocery retail and Rate that sustainability-linked brands are growing Metric tons of CO2 that U.S. cropland could delivery platforms (from March through July) comparatively to others potentially sequester, compared to 8.4mm MT now Farmers are the Frontline Cheaper Healthcare Water 155 80% ~70% The amount of people the average farmer feeds Of consumers believe functional foods help Of global freshwater withdrawals that agriculture today compared to 26 in 1960 prevent or delay the onset of some diseases is re sp o n sib le fo r u tilizin g Source(s): S2G Research, Fa rm Fla vor, Soil Health and Carbon Sequestration in US Croplands: A Policy Analysis by Léopold Biardeau, Rebecca Crebbin-Coates, Ritt Keerati,Sara Lit ke , and Hortencia Rodríguez, Institute of Food Technologist © 2021 Seed 2 Growth 2 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet S2G Ventures Founded in 2014. Located in Chicago and San Francisco. We invest holistically We back and support We act as a hub – convening from soil to shelf. trailblazing entrepreneurs. diverse partners and perspectives. $700M 50+ 5 250+ 250+ Of managed capital across seed, venture, and Portfolio Companies Countries Co-investors including Strategic relationships growth stage companies across the food chain 40 corporates with key players in food production, processing, and $3.0B retailing Of capital catalyzed and added to the system overall outside of direct S2G investments Select Portfolio Companies Select Partnerships $125mm partnership between S2G and CDPQ to 100% invest in climate friendly food and ag Focused on sustainable food and ag investing as entrepreneurs one of the largest and most active venture and growth funds in the industry Source(s): S2G Research © 2021 Seed 2 Growth 3 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet A movement already underway… that can be accelerated with policy Consumers, entrepreneurs, scientists and farmers are creating the biggest transformation in the Food System since World War II. Science is transforming the computation, biology, physics, and chemistry of food production – h e lp in g design a system that is healthier and more sustainable for consumer and more profitable for farmers. Across the S2G portfolio, companies are hard at work to Our build the future of food and agriculture: Portfolio • $9 billion in food and ag tech start-up funding in 2019. a t Wo rk Th is re p re se n ts 0.5% o f risk ca p ita l in ve ste d a s a percentage of Gross Output GDP, compared to 3.1% in fin a n cia l se rvice s, 3.6% in h e a lth ca re , a n d 12.8% in information technology • S2G ch a lle n ge s p riva te m a rke ts to jo in u s in ca ta lyzin g $10 billion of additional investment in Food and Ag Te c h innovation over the next 3 years to close the current funding gap and build a 21st-century global food system that is more resilient, healthier, and more sustainable Source(s): S2G Research, Pitchbook, USDA ERS © 2021 Seed 2 Growth 4 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet The Food System - Growing Transformation The Farmer The Consumer Urgent Need to Increase Profitability with Sustainability Younger, Healthier and more Digital Farm Bankruptcies Data Younger Access Over the last decade, consumer’s purchasing behavior with food has 20% 8x skewed towards a more complex set 72 59% of questions, beyond price and taste, Increase during 2019, this Increase in farm-le ve l d a ta to include concepts such as ethics, Millio n m ille n n ia ls in th e U.S., Ye a r -ove r-year growth in food number has been mitigated by generation on average in the source, environmental considerations, the largest consumer class in and beverage sales through $37.2bn in Federal direct farm next 10 years and the farmer. U.S. history U.S. retail ecommerce payments (2x> Auto bailout) Over a similar timeframe, farmers have continued to face a tight agricultural Indoor Ag Soil Health economy. Farmers are searching for Clean Label Assurance stronger profitability, and while there has been an unprecedented growth in n e w a gricu ltu ra l te ch n o lo gie s, adoption of promising new 3.5x 75% te ch n o lo gie s re m a in s lo w. 6x 90% Growth in U.S. annual lettuce Of la n d is su b sta n tia lly Growth of clean label products Of Top 100 CPG Brands losing greenhouse production in the degraded with significant compared to conventional market share past 5 years contribution from agriculture Source(s): S2G Research & Analysis, Pitchbook, USDA ERS, USDA Ag Census 2017, “US Farm Bankruptcies Reach Eight Year High” Forbes, IPBES Glob al Asse ssm en t Re p ort on Biod ive rsity, United Nations, Goldman Sachs, eMarketer © 2021 Seed 2 Growth 5 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet Post COVID, the Food System is Accelerating this Transformation Channel Digitization . ~8% online grocery penetration (as a % of total groce ry) from COVID-19, up from ~4% from last year . 225 million farm IOT installments by 2024, up from ~1 5 m illio n in 2 0 1 7 45% of the global population is comprised of Millennials and Convergence of Food and Health Ge n Z . 90% of COVID-19 admissions involved at least one comorbidity – obesity, type 2 diabetes, et al. More than 50% of Americans . Computation is a secular tailwind with a 300,000x are Millennial, Gen Z or post- increase in big data processing speed since 2012 Consumers are Th e Th e food system Gen Z (166 million people Feedback are 39 or younger) driving the change adapts to meet in the food system Loop the consumer Global Decommodification . Potential leveling off in the corn and soybean super cycle growth that has occurred over the last 20 years 67% of Millennials and Gen Z . During COVID, plant-based meats grew significantly have already changed behavior and sales as of July were 90% higher year-ove r-ye a r to decelerate climate change Commingling Climate and Profit . $1 trillion in ESG investor assets (Q2 2020 flows up 72% year-ove r-ye a r) . 6.8x EV / revenue multiple for ESG energy companies compared to 1.7x for broader energy market Source(s): S2G Research, Brookings, Food Dive, Mc Kin s e y, Gartner, Centers for Disease Control and Prevention, “Morbidity and Mortality Weekly Report”, April 8, 2020, OpenAI, Morningstar Research, YP u l s e © 2021 Seed 2 Growth 6 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet Pillars of a Future Food System Resilient Rural 1 Rural Broadband Dark Real Estate 9 Supply Renaissance Chains 2 He a lth y So il is Controlled Environment Ag for 8 Ma d e in Am e rica Consumers and Supply Chains 3 Profit Per Acre Moving Production Closer to 7 Consumption A Food System that can serve as a Food as an Extension of the 4 Hip p o cra tic Oa th bridge by supporting healthy people and communities, fostering Nutrition Food as Preventative Medicine as National 6 strong, sustainable farm Security operations, and promoting climate 5 Breeding for Health health by helping farmers profit by moving to the front line of climate change. © 2021 Seed 2 Growth 7 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet Rural Renaissance © 2021 Seed 2 Growth 8 S2G Ventures Healing America - A Future Food System for our Farmers, Consumers and Planet 1 Rural Broadband … impact rural communities’ … and expose fragility in many Gaps in broadband… economic potential… parts of America Policy Considerations 1 in 4 2x and 3x 2,300+ By strengthening rural broadband infrastructure to ensure internet connection Rural Americans do not have Digita lly-connected business During COVID-19, free Wi-Fi for all Americans, the country will be better rural broadband coverage, earn 2x revenue per employee locations offered by the prepared to deal with future crises. according to the FCC and are 3x more likely to American Connection Project Increased funding to bring broadband create jobs Broadband Coalition connectivity to all communities and improve mapping of broadband coverage, including improvements that are geared to meet community-level needs and demand, is a Top 10? 1 in 5 3x sound investment that will help connect By some analyses, the U.S. Rural businesses only use The digital economy is growing communities across the country and solidify does not even rank among the b a sic d igita l to o ls, like ly d u e to roughly 10% per year, nearly their economic opportunities.