The Rise of Functional Foods

From adaptogen rich beverages for cognitive function to ‘gut healthy’ probiotic yogurts and fermented goodies, a growing number of consumers are expecting more from their food beyond basic sustenance.

Functional foods are on the rise, defined as foods that provide more than just essential nutrients but offer specific health-promoting properties such as boosting immunity, disease prevention, cognitive function or overall well-being.

In response, the functional food and beverage industry in undergoing significant transformation and growth with forecasts estimating that the market is projected to grow from over $360 billion in 2024 to nearly $800 billion by 2032 as brands and products target this growing consumer demand.

Room for Food Innovators Ahead

The confluence of consumer interest, technology and innovation supports an exciting time for the food industry ahead.  Brands that are able to innovate and bring to market functional foods and beverages will be able to capture the growing momentum in the space.  The opportunity extends beyond direct-to-consumer (D2C) brands to specialized ingredient suppliers who can unlock and optimize the “function” in functional foods.  For instance, our portfolio company The Every Company  is revolutionising the protein industry by producing animal-free bio identical egg protein through the process of precision fermentation. One of their products, OvoBoost™ is a soluble, taste and texture neutral protein powder that can be easily incorporated into various food and drinks, fortifying them with additional protein and increasing the products overall consumer benefit.

This innovation is particularly timely. The rise of GLP-1 medications (like Ozempic) is reshaping consumer eating habits, with many users prioritizing nutrient-dense, high-protein foods to support muscle maintenance on a reduced calorie intake. This trend is not confined to GLP-1 users, but is part of a broader societal “mega-trend” toward higher protein consumption. Data from the IFIC (International Food Information Council) supports this, with a significant percentage of U.S. adults (61%) reporting they are actively increasing their protein intake in 2024.

Another interesting player in this space is Nuritas, an Irish company that uses an AI-powered peptide discovery platform to find new functional ingredients. Their flagship ingredient, PeptiStrong™, is a plant-based peptide complex derived from fava beans. Backed by clinical studies, PeptiStrong™ has been shown to increase muscle protein synthesis, reduce muscle breakdown and exercise-induced inflammation and lower myostatin while increasing energy.  Essentially, improving the body’s ability to build and maintain healthy muscle. As an ingredient, incorporating PeptiStrong™ can transform the overall functionality of normal food items such as a bars, cereals or shakes adding additional desirable health benefits for the consumer.

The Road Ahead: Functional Foods Are Here to Stay

The consumer drive for personalized nutrition and preventative health is a megatrend today that is reshaping the food and beverage market.  We believe that there is significant market opportunity to cater to the demand for functional foods enabled by advancements in technology, scientific knowledge and innovation. While some diet trends come and go, we are confident functional foods are here to stay.