Thousands of gadgets and gizmos were unveiled at the 2019 Consumer Electronics Show, but the product taking top marks wasn't made of silicon or running on electricity.
It was a hamburger.
It turns out, the win is an apt metaphor for the growing presence of food companies in the tech space. Impossible Foods, creator of the meatless burger that Digital Trends named the Top Tech of CES 2019, debuted its second-generation recipe alongside considerably more "techie" products like a TV that can roll itself up and an Alexa-enabled toilet.
But as tech has moved from a novelty to a staple of business, companies outside the strictly software and hardware space have been attracting tech dollars. Investors who put their capital behind food and tech companies say the sheer size of the opportunity in food is attractive. But recent stumbles for meal kit services and delivery-only restaurants known as virtual kitchens have forced investors to reassess where the opportunity lies.
"Food is the biggest industry," said Greg Golkin, managing partner at the Kitchen Fund, which invests in restaurant brands like Sweetgreen and Cava. "Every human on earth needs to eat roughly three meals per day."
U.S. consumers, businesses and government entities spent an estimated $1.62 trillion on food and beverages in stores and on away-from-home items in 2017, according to the Department of Agriculture. Annual spending on food far surpassed other essentials like health care and personal insurance for the average American that year, according to the Bureau of Labor Statistics.
Venture capitalists have taken note of the huge opportunity, as venture funding for U.S.-based food tech companies has grown from about $60 million in 2008, to over $1 billion in 2015, according to PitchBook, which collects funding data. The money is coming from more and more sources, as the number of unique investors, including VCs and private equity funds, has doubled from 223 in 2015 to 459 in 2017, according to research firm CBInsights.
"Technology is not its own industry anymore, it's part of every other industry," Golkin said. "So it's natural for tech investors to find that intersection."
Food companies have also become more savvy at appealing to tech investors and taken on their high-growth mindsets.
"Food has always been a technology; it's just that it wasn't branded like a technology," Impossible Foods COO and CFO David Lee said in a phone interview from CES.
Speaking from his experience working at a legacy food company, Del Monte Foods, Lee said the industry used to be "driven by large strategic players who were seeking to maintain an incremental competitive edge." Now, he said, disruptive companies are seeking to grow "hundreds if not thousands of percents."