5 Minutes With… Matilda Ho from Bits x Bites.

Bits x Bites is a food tech venture capital firm headquartered in Shanghai, China. The firm makes investments and offers accelerator programmes to entrepreneurs and companies working to accelerate the development of a sustainable food system.

Here, Bio Market Insights’ Liz Gyekye catches up with Matilda Ho, managing director of Bits x Bites.

Liz Gyekye (LG): What’s the story behind Bits x Bites (@bitsxbites)?

Matilda Ho (MH): Bits x Bites is the first VC in China focusing on technology applications in food and agriculture. With advanced medicine and computer engineering fundamentally reshaping human life, we believe there is tremendous opportunity to adapt science advancements from those areas to address the systematic challenges in the food supply chain. And given China’s outsized footprint in our complex and interconnected global food system, there was no investor focusing on funding early-stage tech companies in the food sector. I saw an opportunity to create Bits x Bites to fill this void.

To date, we have invested in 14 companies advancing gene editing for high-performing crops, as well as a cellular agriculture company developing non-GMO meat production directly from animal cells without an actual animal.

What were you doing before you became managing director of Bits x Bites?

MH: Before Bits x Bites, I founded Yimisiji, a Shanghai-based farm-to-table e-commerce platform focusing on food education and transparency around organic, chemical-free produce and food products. This role lends me first-hand insights on the farmers’ side, the consumers’ side, as well as the supply chain logistics. These perspectives are valuable in how we select investment portfolios. And as an entrepreneur, I am able to empathise with the challenges that our founders may face on a day-to-day basis. I find myself often sharing lessons I learn from the trenches, including operations and people management.

Before Yimishiji, I was a BCG management consultant and IDEO business design lead, advising global and Chinese brands mainly in the food and beverage sector.

How do you choose your investments?

MH: We look at technology that can be applied to the whole food supply chain, from the farm to midstream ingredient innovation and sustainable packaging to personalised nutrition and consumer foods. Currently, the topics we attend to most are protein security, nutrition, packaging, and food safety.

In general, our vetting markers are quite similar to most VC colleagues, including technology feasibility, market potential, and the founding team’s capabilities, the latter of which is an especially critical indicator in early-stage investing.

In addition, in our investment thesis, we lean toward companies that have a collaborative business model, meaning they are looking to partner with larger companies instead of solely competing with them. Many food and ag corporates already show strong interest to work with tech startups in China, and young companies can leverage their mature supply chain to grow more quickly.

Earlier this year, we launched the China Food Tech Hub with the purpose to bring together startups and potential corporate partners for pilot projects. Danone, Coca Cola, PepsiCo, Nutreco, LDC, and General Mills are some of the founding members.

What’s coming up next for your company?

MH: On the portfolio front, we are in the process of assessing follow-on investments in several portfolio companies. In fact, we just closed our Series A investment in cell ag company Future Meat Technologies, after investing in its seed round a year ago.

On the investment side, we continue to assess new companies that fit our investment thesis. In the synthetic biology category, we are keen to see startups addressing packaging waste, nutrition and clean label, as well as more sustainable production of protein, palm oil, and other staples.

On the ecosystem side, we are planning the second edition of the 2050 China Food Tech Summit, the leading conference dedicated to food tech startups for the Chinese market. Dates are set for July 16-17. We can’t wait to share more details.

What advice would you give to someone else looking to launch their own company/product in this space?

MH: Many tech startups have a tendency to over-engineer. And in the food space which is highly price-sensitive compared to most other industries such as pharma, overbuilding can lead to waste of time and money and ultimate demise. Therefore food tech companies that have legs tend to be all-rounded teams that not only have excellent engineers but also access to expertise from the targeted business sector, be it agricultural or plastics. As a company develops its solution, it has a clear picture of its target customer’s real unmet needs, decision making matrix, and acceptable price points etc.

This also applies to companies looking to enter China. Chinese companies are very pragmatic. It wouldn’t matter how advanced your technology is if your solution doesn’t fit them like a glove. Having an advisor or partner who has insights on the ground is the only way to succeed.

What’s your favourite sustainable/bio-based product?

MH: There are many sustainable biotech solutions that inspire me, but I’m biased toward our portfolio so I’ll pick cell ag company Future Meat Technologies. I recently had a chance to sample its cell-based chicken fat in its lab in Tel Aviv. The company is working to develop a cost-competitive hybrid product by 2021. It’s easy to imagine how the aroma and taste of this fat can make plant-based foods more attractive to the meat-loving population, and thus reducing our reliance on animal protein.

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