Silicon Valley Incubator Program Places Focus Squarely on Development of Sustainable Food and Farm Startups
May 29, 2012 | Jessica Vernabe
Palo Alto-based Local Food Lab aims to be an incubator for sustainable food- and farm-focused startups that will help rebuild a broken food system. The idea is to equip entrepreneurs with the tools to create businesses that are scalable so they can make a larger impact in the food sector, says Local Food Lab CEO and Co-Founder Krysia Zajonc. Local Food Lab starts its first incubator program in June, offering entrepreneurs four weeks of top-notch business training, access to seasoned mentors, opportunities to network with each other and the chance to pitch their ideas to investors.
The course, which runs from June 25 through July 20, costs $1,750 in tuition. The program has attracted more than 20 applicants, though only about 10 will be chosen due to space limitations, Zajonc said. The program will be held at Local Food Lab’s Palo Alto headquarters, a large five-bedroom house that has been converted into a workspace with a test kitchen, a boardroom, a private office, communal workspaces and an outdoor garden area. There are also plans to, in the future, possibly offer entrepreneurs shared workspace that they can pay for through membership fees.
Local Food Lab is a brand new venture—having just launched in January—that was itself birthed out of an incubator program. Zajonc started building her business as a student in Columbia Business School’s Entrepreneurial Greenhouse Program through the Eugene Lang Entrepreneurship Center. Now Zajonc is taking her knowledge and passing it forward with a more refined target of sustainable food and farm ventures, an area she says is growing but still needs more entrepreneurs to meet demand.
“The major problem that we’re trying to solve is helping food entrepreneurs figure out how they’re going to scale,” she said. “It’s either solving the problem when they’re still in the business planning stage or getting them later on when they’ve already established a good product, but they need to figure out how to get this thing that’s successfully serving their town… into something that could be bigger.”
Zajonc noted that she is passionate about replacing the large “incumbent” food companies that currently dominate the food system with “small, scalable, for-the-good” businesses. Local Food Lab only focuses on startups that somehow contribute to sustainable food production and agriculture.
Zajonc says she knows what it’s like to create food-focused startups without the proper business training, and she wants to help others avoid the struggles she had. After graduating from Stanford University with a degree in film, history and culture in 2007, she started three food-related businesses in Costa Rica—a hotel restaurant that used all local products, a business that made chocolate products and sold it regionally, and a bookstore/café.
However, Zajonc came to realize that her businesses were not scalable, and she enrolled in Columbia Business School’s entrepreneurship program with the hopes of continuing in the food industry but with a broader perspective. Her business partner is Mateo Aguilar, who currently attends Columbia University and who has an extensive background in the food industry.
One major goal behind Local Food Lab, Zajonc said, is to strengthen the vibe around the food and farm startups.
“I grew up in the Silicon Valley and I worked at Facebook back in like 2005, so I kind of had an insider window into this massive excitement about startups,” she said. “I want to bring that infrastructure and that ecosystem to the food and farm world so that we could look sexy in a way to get young people excited.’”
The Incubation Program
Through Local Food Lab’s first incubation program, participants will experience more of a classroom experience on Monday and Wednesday mornings when they will learn about basic business concepts from Zajonc and other MBA mentors, Zajonc said. Some of the those concepts will include market and industry analysis, product and service design, financial forecasting, sales and marketing strategy, development of a social mission statement and management of a mission aligned team, according to Local Food Lab’s website. The entrepreneurs will also get the opportunity to pitch their business plans to investors, Zajonc said.
Monday and Wednesday afternoons will be reserved for meetings with mentors (or entrepreneurs and industry professionals with extensive experience in their fields). On Tuesdays and Thursdays, the Local Food Lab facility will be open to students who want to use the workspace to network or work on their business plans and investment pitches.
Local Food Lab will only be working on a tuition basis, as opposed to taking equity in the incubated businesses. However, Zajonc said there will be a contest at the end of the program in which the winner will have the option to apply for a convertible note offered by Local Food Lab. This would result in Local Food Lab providing funding to the selected startup. That investment could later be converted to equity after the startup receives its second round of funding, she said.
Fharzana Elankumaran, who has already been chosen to participate this summer, said she learned about Local Food Labs on Twitter. She owns I Heart Curry, a six-month-old Mountain View, Calif.-based business that provides in-person Indian cooking classes in the South Bay area. She said she avoids using canned and processed ingredients and instead focuses on using fresh, organic food from local farmer’s markets, local farms and local Indian grocery stores. Elankumaran plans to start making and selling cooking videos in order to reach customers outside of the San Francisco Bay area.
“I would like to learn how to reach my target market on a small budget (and) also how to scale up because I’m a really small business right now,” she said, noting what she wants to learn this summer. “I have a few options in my mind. … I would like to work on each one of these a little bit and see which one of these makes the most sense.”
Elankumaran noted that Local Food Lab appeared to be just the right fit for her business.
“Local Food Lab is for food startups only,” she said. “There are other incubators, but they are for tech startups. … I don’t know if they (tech startup incubators) will accept food startups to begin with because they consider us to be high-risk startups. Even if they accepted me, I don’t know if they have any food experts there.”
Zajonc said she hopes that by the fall, Local Food Lab can move into a larger location, which would also be in Palo Alto. The idea is to no longer be located in a residential house and instead find something with more of a warehouse feel, she said. A few features she would like to have are a commercial-sized kitchen (hopefully at least 2,500 square feet), some larger agricultural space and agricultural test equipment. The new location would still include boardroom, office and general work space, and it would serve as a shared work hub. In the future setup, food and farm entrepreneurs would pay a fee (likely somewhere around $300 a month) to have access to the facility.
However, she noted that there’s also the possibility that Local Food Lab might instead partner with another business or incubator that already has a shared workspace model, leaving Local Food Lab to focus mainly on the incubation programs.
Zajonc said Local Food Lab stands out because of the fact that it combines the farm and food sectors. This allows for much needed collaboration, she said.
“If there was somebody who was making this amazing sustainable pesto, wouldn’t it be great if they could buy that directly from a local sustainable basil grower instead of going to a big wholesale market and finding the cheapest thing they could find from China?” she said. “Food is challenged on a whole, so we just bring all the entrepreneurs and all the stakeholders to the table. That means not isolating the restaurateurs and the food product entrepreneurs from the farmers because they’re using each other’s inputs and outputs.”