Investors demand authentic growth from sustainable food brands

Truly Nuts! and TNB Aura outlines what it takes for sustainable food businesses to scale.

As Singapore targets producing 30% of its nutritional needs locally by 2030, attention is turning to how small, sustainable food businesses can successfully scale. Business leaders say the key lies not only in scalability but also authenticity.

Gareth Lloyd, Co-founder and CEO of Truly Nuts!, emphasised that while investors still look for scalable models, sustainability and authenticity have become non-negotiable. "They want a replicable model that can scale, but they are now starting to really dial into making sure that those brands are sustainable," Lloyd said.

Lloyd stressed the growing importance of credibility, noting, "Authenticity is obviously critical, because so many businesses are involved in some kind of greenwashing." He shared that Truly Nuts! sources Brazil nuts ethically by hand from the Amazon rainforest to prevent deforestation, investing 25% of profits into environmental and community projects to build trust with both consumers and investors.

Charles Wong, Co-founder and Managing Partner of TNB Aura, said that investors are looking for more than brands lifted by government support. He highlighted three key criteria: a clear brand signal in value, pervasive unit economics and business model advantage, and thoughtful decisions around distribution strategy.

When it comes to equity and fundraising, Lloyd advised flexibility depending on strategic alignment. "I think what is the number you need to share as a founder in order to scale and hit your vision. And that's how I would look at it," he said. Partnerships, he added, must be aligned with a company's vision and values to justify any ownership dilution.

Wong offered specific benchmarks based on growth stages. "Founders are usually giving roughly around 10 to 20% of equity up early on to earlier investors such as angels, pre-seed and seed funds," he said. By Series A, where businesses typically achieve US$1 million or more in annualised revenue, equity dilution ranges from 20% to 25%, he added.

Preserving brand identity during rapid expansion is another major challenge. "Staying super true to those values and making sure that you're aligned on the vision and working towards that every day will make sure that you preserve that brand identity even when you're tracing significant growth," Lloyd said.

Wong agreed, highlighting authenticity as critical for long-term success. He warned that brands chasing fast growth through external distribution channels risk losing identity and customer loyalty if authenticity is compromised.