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Food biz: Innovation from Colorado to the world

Local companies set the bar high to deliver what eaters want


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With heightened health and environmental consciousness, the food industry – from upstarts to corporate giants – is experiencing a revolution. In the last decade, the niche food startup scene has been booming, showing no signs of slowing, as consumer preference sharpens and expands exponentially. With success stories like Justin’s LLC – the pioneer of nut-butter based snacks and spreads, acquired this May by Hormel Foods Corp. for $286 million – the Boulder-Denver corridor has become the epicenter of food innovation.

“I would say the one big thing that makes Colorado stand out is that there is a very collaborative spirit amongst the food industry,” says Sam Bailey, senior manager of global business for the Colorado Office of Economic Development and International Trade. “It extends from companies that are just starting up to companies like Justin’s.

"You can start in your kitchen, scale, utilize resources in the state – from contract manufacturer Fresca Foods Inc. to Naturally Boulder – and extend distribution nationally and internationally.” He points to purely elizabeth, a granola and oatmeal company that relocated from New York to Colorado and was able to scale and seek investment. “We’re seeing a convergence of necessary assets,” Bailey says.

Bailey adds that being one of the “leanest states in the country,” adds to the brand reputation for Colorado-based food products.

It’s no wonder, then, that Denver- based, publicly traded WhiteWave Food Co., announced its presence in the Ivy League in early May. Silk, a brand under the WhiteWave umbrella, will engage in a year-long sponsored research initiative with the Center for Health and the Global Environment (CHGE) at the Harvard T.H. Chan School of Public Health to research how food companies, academics, industry and consumers can approach the future of food.

“It’s becoming abundantly clear that the way the world currently produces, distributes and eats food must change if we are going to meet the needs of a growing global population in an already fragile environment,” says Rebekah Lyle, director of marketing for Silk. “For 20 years, Silk has been committed to leading a movement to change the dialogue among key stakeholders in the food industry and help consumers make choices that are better for their health and the planet.”

The research will focus on three key initiatives: environmental sustainability, transparency and health and wellness.

According to Lyle, the hope is the CHGE research will examine:

• “To what extent companies are committed to ensuring their business operations and supply chains minimize environmental impacts;

• “To what extent companies are communicating openly and clearly about the journey of food from farm to table and the ingredients in products so consumers know what they are buying and eating;

• “How committed packaged food and beverage companies are to providing products that reflect public health concerns and to making these healthier options more desirable, affordable and accessible.”

  On the environmental side, Silk representatives reference these statistics based on peer reviews:

• Producing one carton of Silk soy, almond or coconut milk uses 900 fewer gallons of water than production of a single carton of conventional dairy milk.

• Producing one carton of Silk plant-based beverages generates 60 fewer greenhouse gases.

Lyle says results and details will be presented to convening leaders across academia, the NGO community and private sector at a summit hosted by CHGE later in 2016.Though on a smaller but growing scale, Cappello’s, a Denver-based gluten-free, grain-free food producer since 2011, is committed to the promotion of smarter food making and eating habits as well.

After returning to Colorado in 2010 from a year abroad in Argentina, co-founder Stacey Marcellus sought to develop a tangible brand. With a gluten-sensitivity all her own, she and co-founder Ben Frohlichstein – whom she met several years prior in Boulder after he stopped her on the sidewalk to ask about her haircut, and learned she was a local hairdresser, whereupon she took on his coiffure – teamed up and decided to create a line of gluten-free, grain-free products, starting with pasta.

“We were inspired by each other,” Marcellus says. “It’s a part of the industry that needed some attention.”

She says that despite plenty of gluten-free products available,“that doesn’t automatically mean that the ingredients they’re sourcing are healthful.” She adds that the true “game-changer” as she and Frohlichstein solidified a recipe was almond flour, distinguishing the taste, texture, and now, popularity of Cappello’s products.

According to Marcellus, local farmers’ markets served as the prime placement to develop a captive and loyal audience at the brand’s beginning. Paleo, vegetarian, vegan, gluten-sensitive and Celiac customers have developed a loyal following to Cappello’s in the years since its launch.

When asked about the cost of the products, higher than many prepared noodles available at groceries and markets, Marcellus says, “You can pay now or pay – for your health – later.”

Comparing and contrasting two local food and beverage brands:

SILK -vs- CAPPELLO’S

PRODUCT:

Silk: Dairy-free, plant-based milks

Capello’s: Gluten-free, grain-free products, from pastas, to cookie dough, to frozen pizzas

RECENT SUCCESSES:

Silk: European penetration; trailblazer in sustainability initiatives; $550M acquisition of Vega, a pioneer in plant-based nutritional products

Capello’s: rojected to net $6 million in 2016; currently has the top five pasta SKUs at Rocky Mountain region Whole Foods Markets; recent partnership with Green Chef

CONCERNS/COMMITMENTS:

Silk: Water scarcity

Capello’s: Vendor relationships; excessive packaging required to get food on shelves

LOOKING AHEAD:

Silk: “We anticipate that the [CHGE] research finding could inform the direction of our business moving forward,” says Rebekah Lyle, director of marketing for Silk

Capello’s: Triple, to quadruple sales in 2016; re-launching pepperoni pizza; fostering vendor relationships to source ingredients most responsibly and sustainably

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Gigi Sukin

Gigi Sukin is digital editor at ColoradoBiz. She can be reached at gsukin@cobizmag.com.

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