Battle Creek, Mich.-based cereal maker Kellogg Co. (K) has decided to hedge against a 2% dip in its morning foods business last year by investing outside of its typical market and into new consumption patterns. U.S. plant-based smoothie maker Bright Green is the latest to raise capital from the food giant in a $2 million seed round led by Kellogg’s venture capital arm eighteen94 capital. The two-year-old startup makes frozen produce-packed cubes that can turn into smoothies by simply adding water. The San Francisco-based company currently sells what it markets as a healthy, convenient breakfast alternative at Whole Foods Market Inc. (WFM) stores and at over 1,000 Kroger Co. (KR) locations.

The investment comes as packaged food leaders like Kellogg continue to struggle to win back health-conscious Millennials​ who have shunned the major label brands of their childhood. (See also: Cereal Makers Grapple With World’s Obesity Crisis.)

Desperate to Revive Sales

When eighteen94 capital launched last summer, the packaged goods manufacturer announced plans to invest about $100 million into food pioneering startups. Earlier this year, Kellogg invested in plant-based powder and “superfood” bars maker Kuli Kuli.

Kellogg isn’t the only food giant that has found in-house innovation insufficient to meet new demands. As legacy brands decline across the board, peers such as Campbell Soup Co. (CPB), General Mills Inc. (GIS), Tyson Foods Inc. (TSN) and other leaders across food and beverage have also launched their own venture fund. In return for minority stakes in disruptive companies, F&B leaders offer a quick means for startups to boost their growth through scale while providing expertise in packaging, marketing and distribution. (See also: Food Megabrands Danone, General Mills, Kellogg, Campbell to Smaller Rivals: Can't Beat Em', Join Em’.)

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