A deluge of startup companies in the consumer technology and consumer packaged goods (CPG) sector have successfully secured a generous amount of venture capital in the previous year. Among them are Keychain, Harmonya, Highlight, Ramani, SupplyPike, Vividly, and Turing Labs, which have all caught the attention of investors for their cutting-edge technologies.
But it’s not just the companies themselves that have attracted funding. Investment firms specializing in the consumer and CPG industry, such as VMG Catalyst, Alethia, and Humble Growth, have also received significant financial backing.
While traditional CPG products have had their time in the spotlight, they are not necessarily considered worthy of venture capital. This is due to the ever-changing tastes of consumers, limited shelf space in grocery stores, and the need for finesse in navigating the world of e-commerce. Many of the companies mentioned above that have secured large amounts of capital fall into the category of “enablement,” as they aim to help CPGs improve their business strategies.
But why is there such a keen interest in consumer technology and CPG as a lucrative opportunity right now?
It’s likely that a significant part of this interest stems from the excitement surrounding artificial intelligence. Dana Kim, co-founder and CEO of Highlight, experienced this firsthand while seeking Series A funding for her product testing startup.
“Throughout the fundraising process, a question that kept coming up was, ‘What role does AI play in your organization?'”, Kim shared with TechCrunch+. “What gave investors a sense of security was knowing that Highlight was not going to be disrupted overnight by some new form of generative AI. At the end of the day, a brand like Oreo will still need to know which version tastes better, and that’s not something AI can determine. In the face of disruptive technology, having solid data is crucial.”
