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Functional Nutrition
Overview
Functional nutrition is a medical discipline emphasizing the importance of understanding how food can influence health at a deeper level. Instead of focusing on treating symptoms, it probes into the root causes of health issues and uses personalized dietary practices to address them. By selecting the right food and nutrients tailored to an individual's unique needs, functional nutrition aims to prevent, manage, and even treat chronic diseases.
The growth of functional nutrition apps is driven by the rising prevalence of chronic diseases and nutrient deficiencies, with increasing demand for personalized dietary guidance. The COVID-19 pandemic played a major role in heightening overall health consciousness, leading consumers to seek products with added nutritional benefits. Millennials and Gen Z, in particular, are adopting digital platforms for customized health solutions, further driving demand. However, significant risks exist, including privacy concerns related to the storage of sensitive health data, which could lead to security breaches. Additionally, the need for rigorous scientific validation to gain trust from healthcare providers and users in addition to complex regulatory requirements could deter new entrants from the market.
Industry Updates
Market Sizing
The US Functional Nutrition market could reach USD 16.1 billion–20.4 billion by 2028
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Market Mapping
The Functional Nutrition industry is composed of players that offer nutritional interventions to prevent, manage, and treat chronic diseases and improve overall health. These include startups that offer nutrition management platforms, nutrition-based chronic care, supplements and nutraceuticals, personalized food service platforms, and telenutrition platforms.
Nutrition-based chronic care platforms accounted for most of the industry’s funding (42%) as of March 2024, with around USD 629 million raised. This was followed by the supplements and nutraceuticals industry segment, which raised around USD 530 million as of the same date, also accounting for ~42% of the industry’s funding.
Large-scale nutrition providers such as Nestlé and Kraft Heinz, along with traditional technology companies such as Whirlpool, are some of the major incumbents active in the space, with the former group providing supplements and nutrition management platforms, respectively.
Nutrition management platforms
Nutrition-based chronic care platforms
Telenutrition platforms
Supplements and nutraceuticals
Personalized food services
The Disruptors
A majority of disruptors in the space (~57%) were founded after 2017, and most of them currently tend to be at go-to-market and minimum viable product stages. The disruptors in this space also tend to provide cross-service offerings between most segments. However, providers of personalized food service platforms tend to exclusively focus on this business vertical.
None of the disruptors tracked in the space are publicly listed; however, the space does have some large players–based on total funding raised. These include companies such as Foodsmart, Viome, and Zoe, which (as of September 2024) have raised USD 315 million, USD 276 million, and USD 104 million, respectively.
Funding History
Competitive Analysis
Incumbents
Incumbents offering functional nutritional solutions include major nutrition and food providers such as Kraft Heinz and Nestlé. The industry also includes well-known players that operate across other industries, such as wellness provider Weight Watchers, electronics and appliance manufacturer Whirlpool, medical device manufacturer Medtronic, and grocery technology company Instacart. Other incumbents, such as Herbalife, Nature’s Way, and Mom’s Meals, that operate only in this space, leverage their respective industry knowledge to compete with other diversified incumbents.
Most incumbent in-house activity is spread evenly across the nutrition management platforms, supplements and nutraceuticals, and personalized food services segments. Partnerships, however, were only observed to be formed between incumbents and disruptors in the supplements and nutraceuticals and the nutrition management platforms segments.
M&A in this space is relatively minimal, with the most recent activity being in August 2021, when Nestlé acquired The Bountiful for a transaction value of USD 5.75 billion. Previously, Nature's Way acquired Blaze in February 2021 for an undisclosed sum.
Notable Investors
