S2G Ventures, one of the biggest venture capital funds focused on making the food system healthier and more sustainable, has invested in more than 60 companies, from Beyond Meat to Sweetgreen, since it launched in 2014. But the money behind it has always been clouded in mystery. That’s because its biggest funder wasn’t public until now: Lukas Walton, a 35-year-old billionaire grandson of Walmart founder Sam Walton.
Walton is intensely private about his life and, until now, hasn’t talked about his work. But for the last several years, Walton has been quietly helping create a new platform that he says is designed to tackle systemic social challenges. The platform, which publicly launched today as Builders Vision, combines philanthropy, direct investment—including S2G Ventures—and advocacy. “Philanthropy itself wasn’t necessarily addressing where and how the ladder of innovation to scale companies …. was happening,” Walton says.
When S2G Ventures first launched, few investors were looking at the food system. “Food wasn’t sexy,” he says. “Neither was agriculture.” Walton’s interest in the food system is lifelong: As a toddler diagnosed with a rare form of kidney cancer, his parents attributed his recovery in part to a shift to healthier food. His parents (his father is Walton’s son, John T. Walton, who died in 2005; his mother is Christy Walton) later started a community education center focused on nutrition and gardening.
While most impact VC firms focus only on the power of entrepreneurs to make social change, S2G Ventures also works closely with the other parts of the Builders platform, a philanthropic arm called Builders Initiative and an investment arm called Builders Asset Management. (S2G Ventures is part of an arm called Builders Private Capital.) To help the world’s kelp forests and support ocean health, for example, a Builders Vision fund invested in Urchinomics, a unique startup that harvests sea urchins, which have been multiplying in warmer waters and devouring kelp as populations of starfish, a natural predator, have declined. At the same time, Builders Initiative funded the nonprofit Nature Conservancy to research kelp recovery, and breed and release starfish in areas like the Northern California coast.
“We think about the world and what’s the problem we’re trying to solve,” says Bruce McNamer, president of the Builders Initiative. “And then, what are the tools that will be required to do that.” The organization also works with other nonprofits on advocacy—in the case of sustainable aquaculture, pushing for new regulations that can help the industry succeed. “We look at it from a systems perspective,” says Sanjeev Krishnan, chief investment officer at S2G Ventures. “We want to not only have the companies win, but the system to change. And that, fundamentally, is quite different than what I think traditional investors are trying to do. One of the things we try to look for is, where are the leverage points in the system?”
Within the world of startups, S2G Ventures tries to affect the food system holistically. After it invested in Beyond Meat, one of the pioneers of realistic plant-based meat, it also looked at what else was needed to help the company succeed, including better sources of yellow pea protein, a key ingredient. “That really is a core protein of Beyond Burger,” Krishnan says. “So we’ve invested in companies that make yellow pea higher protein, more neutral, more nutritious, less processed. Then beyond yellow peas, what are the farmers that need to shift from planting commodity acres to actually planting a legume that has huge soil health benefits, as well as higher profits for farmers? So how do we have the fintech solutions to help them transition?”
When it looks at the need for more organic food, the firm funds both organic food brands and others working on related solutions like pest control based on genetics. “Organic food, obviously, has been a huge pull from the consumer, and it has created a lot of growth for the sector,” he says. “But how do we make it more affordable? How do we bring 21st century science to make it more productive and more regenerative?”
Investor interest in food and agriculture companies is quickly growing, particularly from funds with a focus on climate solutions; agriculture is responsible for around 11% of global emissions. Over the last year, more than half of climate tech VC firms funded food companies. Apeel Sciences—an S2G portfolio company that helps make produce last longer—has reportedly raised more than $600 million. Krishan argues that food is in at the beginning stages of what happened with investment in clean energy, and Builders Vision wants to help propel that forward.
The energy transition “was a multi-decade effort,” he says. “But in 2021, 20% of overall capacity was renewables in the grid, more than coal. If you would have told me in 2004, that renewables would have surpassed coal in 2021, I would have been surprised. The pace of change that is occurring in our world is tremendous, and I think we’re just getting started on the food system, and we’re just getting started in the ocean. I have every hope and intention that it could even be faster than the energy transition because it’s been driven by consumers. And entrepreneurs are really changing the biology, chemistry, physics, and data science of food production in a way that makes the planet more healthy, and in a way that makes consumers healthier.”