Investing in your health (literally)

The financial impacts of the COVID-19 pandemic have meant a decrease in investment and M&A activity around the world. However, the strength of the health and nutrition industry, coupled with an increased demand for natural products and supplements, has allowed deal flow to remain active in our industry.

Following up on our top trends piece from a few weeks ago, which reflected trend momentum among innovators that were registered for Expo East 2019 and 2020, we can apply that same trend lens over target companies receiving investments.

New Hope Network’s Nutrition Capital Network (NCN) tracks investment transactions occurring in the health & wellness / natural products industry. By creating an index of those transactions, which compares benchmark scores of weekly investment transactions in Q4 2019, we can see how investments are progressing.

With thousands of transactions stored in the NCN database over the last 4 years, the NEXT team reviewed target companies and compared them to our NEXT Trend database. This gave us a sense of which trends have shown prominence over the past 6 months, and ultimately what types of companies are getting investors’ attention.

Top trends for target companies receiving investment in 2020:

1. Organic
Organic is a base standard in the fight for good food, but brands are doing more by engaging in policy to strengthen its standards, expanding acreage, or showcasing a deep understanding of the ecological journey to their organic efforts.

2. Clean Label
Simplification is a means to rebuilding trust. Brands are stripping out unpopular ingredients, creating simple ingredient lists, and addressing cleanup efforts behind their products.

3. Endocannabinoid System
The promise of CBD, hemp, and the endocannabinoid system are driving growth, experimentation, and innovation.

4. Science First
Brands are stepping out ahead of product development by leveraging the scientific research to lead formulation. To have scientific proof supporting a brand’s mission and back its claims is an opportunity to differentiate and earn consumer trust.

5. Plant-Based Ethics
The side-effects of the livestock industry are drivers for consumers opting for more plants as they either reduce or avoid animal-based foods entirely.

6. Allergens & Intolerances
Insensitivities have become pervasive, and consumers are following regimens that eliminate the primary culprit of many afflictions. Brands are building product lines to accommodate dairy-, allergen-, gluten-free and other digestive, immune, or ailment triggers.

7. Quest for Rest
Consumers seek products to help them prepare to be alert and energized when life demands it, alongside counterbalancing periods to recharge, relax, and re-energize.

8. Waste Reduction
Brands and businesses are stepping up with clever ideas to reduce and remove waste along various steps and corners in the supply chain. Through by-product turned value-add or ingredient optimization ideation, waste otherwise known as a pollutant turns into energy or edible food.

9. Plant Protein
There are other sources of protein and the plant kingdom is full of options with exotic new entrants as well as cleaned-up modifications of legacy heroes like soy and seitan. Consumers are seeking clean plant proteins with other nutritional benefits that are more efficient calorie sources from farm to stomach compared to animal-based products.

10. Immunity
Who has time for being sick? Shifting from reaction to prevention, consumers are seeking ways to strengthen the body’s defenses and stave off illness.

Looking for more trends insights to succeed in this brave new world? NEXT is here to help, whether you’re looking for custom market research or affordable off-the-shelf solutions to guide your brand for today’s and tomorrow’s marketplace.

Don’t miss the NEXT team, live in action (virtually), next Wednesday, September 16th, during the Spark Change Mission-Driven Business Community Event. Our very own Eric Pierce, VP of Business Insights, will be speaking alongside Kathryn Peters, EVP of SPINS, presenting insights into the mission-driven business trends shaping the growth of the natural products industry. Then tune in as members of NEXT and New Hope Network share their mission-driven product picks. Register today!

Plus, don’t miss our expert’s guide to the hottest trends in the natural products industry, with our brand new NEXT Trend Guidebook 2020, only $99!