The Cost of Poor Nutrition

In today’s fast-paced world, the convenience of processed food and the allure of unhealthy diets have led us down a precarious path. The cost of poor nutrition is staggering in terms of the financial burden and its toll on human health. The impact extends far beyond individual health concerns, affecting our economy and military readiness and contributing to the widening gap of health disparities among low-income populations.

The Economic and Health Burden

Poor nutrition and its resulting health conditions significantly drain the US economy. Diet-related diseases, such as obesity, cardiovascular disease, and type 2 diabetes, cost us an estimated $1.9 trillion annually, which astonishingly surpasses our national defense expenditure. These health conditions are not just numbers; they manifest as lost productivity, escalating healthcare costs, and diminished quality of life.

Our military readiness is compromised too. Between 2011 and 2015, rates of excess weight and obesity among active duty service members rose by 73%, demonstrating how diet-related health concerns can impact even the most physically demanding sectors of our society.

The Role of Food Culture

Our food culture plays a pivotal role in our health. Dietary habits, influenced by cultural, socio-economic, and marketing factors, are the primary contributors to leading causes of death, including heart disease, type 2 diabetes, and cancer. Foods high in salt, sugar, and saturated fat contribute to obesity, chronic inflammation, high cholesterol, and insulin resistance. Conversely, nutrient-dense foods like fruits, vegetables, and whole grains can lower blood cholesterol levels, blood sugar, and body mass index (BMI), indicating that food can effectively prevent, slow, or reverse the development of obesity and diet-related diseases.

The Disparity Gap

Unfortunately, poor nutrition and diet-related diseases disproportionately affect low-income populations. This is partly due to the high costs of healthy foods, making them less accessible to those on limited incomes. Despite the extensive resources focused on Healthy Eating, Active Living strategies, we are failing to change the dynamics of food culture or halt the rise of obesity and diet-related diseases among these vulnerable communities.

The Potential of ESG Ratings

We need a robust policy and regulatory environment that facilitates healthy food culture and market incentives that reward steps towards health and wellness. One promising approach to driving this change is incorporating health metrics into the ESG (Environmental, Social, and Governance) investment model.

ESG investing, which rates companies based on their environmental, social, and governance practices, has driven positive business changes. By including food/health metrics in ESG ratings, we can provide investors with a standardized and consistent approach to measuring the impact of companies on the food culture and health of consumers. This inclusion will help investors identify and prioritize companies that are making positive contributions to food systems and health.

Towards a Healthier Future

The cost of poor nutrition is too high to ignore. By incentivizing companies to promote healthier food choices, we can create a virtuous cycle where businesses benefit from better ESG ratings and consumers benefit from improved food culture and health. This approach will democratize food culture and health improvements, ensuring that all income levels benefit from these improvements.

Consideration

With 2021 well underway and with public markets still strong, we think it is an important time to highlight some of the key private market, venture investment themes that iSelect fund has identified for the year. We believe technologies transforming the Agriculture, Food and Wellness markets will flourish, with a focus on four areas: technologies that enable better food choices to drive better health outcomes, technologies that drive better, more profitable farm operations, technologies that drive the Consumerization of Healthcare, and biome-based treatment technologies. At iSelect, we invest for impact AND performance. We offer qualified investors access to emerging growth companies through our national venture capital strategy. Our unique structure allows our investors to continue to invest in these companies as they develop.

Timing

Why is now the right time for venture? The answer is that now is not explicitly the right time. Venture is something we need in our economy at all times. Now is not better than any other particular time. The question is, why ever stop? When we look at the challenges we’re facing in food and healthcare the reality is there is someone, somewhere who has an insight about how to build a product that will solve those problems. And if they put the right resources to it, they will succeed. As long as we need new technology to make life better or make our lives more enjoyable, we need venture capital to help fuel those entrepreneurs.

What is iSelect as a product?

iSelect is a very unique product, but when you break it into its parts it’s fairly easy to understand. On the front end we’re a traditional venture capital fund. We have a diligence process. We have an investment process. We have categories of industries where we have focus and real expertise, and we invest in companies in those areas that meet requirements for the fund. On the back end we’re unique in that we don’t raise a large amount of capital at one time and deploy it over the life of our fund. Each deal that we bring onto the fund, our investors have to prove and determine to invest in that deal. We have to constantly prove our diligence standards. It’s accessible, transparent and easy for investors to come in and see our comprehensive process.

What is the ideal iSelect company?

We are looking for founders that are passionate and we want the problem they’re trying to solve to be big, real, and painful. We want the solution to be revolutionary and we want our capital to be able to help them solve that problem. We want to know that they have customers involved and that the solution they’ve come up with actually meets those customers’ and market needs. And we want the team to be capital efficient with the money they’re spending.

What does the ideal iSelect company look like?

We’re looking for a company that has an opportunity to have a 10x return to our investment or greater in a period of three to seven years. What excites us at iSelect are companies that are solving big problems. We want companies that are going to be the Monsantos of the future. Not just in the size and the scope, but the impact they have on people’s lives. We want to create positive impacts on people’s lives, so we invest in areas like agricultural production and areas like producing healthy foods for our kids. They are problems that impact real people’s lives on a daily basis. That’s what we’re trying to do at iSelect. We’re trying to solve the big problems out there. Find ways to bring capital to the entrepreneurs who are the real heroes out there getting up every morning, beating away at these things that are problems that you and me and everyone else faces in their everyday lives.

What is iSelect?

iSelect is a venture capital firm. What that means is we look at hundreds and hundreds of different companies and we apply tough diligence standards to each of them, looking at whether the team has a good plan for growing the business, whether the team is qualified and credible, and more. We do that to resolve the few who provide the best opportunities for investors. And then iSelect takes that smaller set of investments and goes to investors who are interested in venture capital and provides a way for them to invest in these companies, either individually or all at once. We co-invest alongside other venture capitalists. We source transactions through to an exit where the company would become public or get bought. And we manage that whole investment process on behalf of our investors.

The Cost of Poor Nutrition