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Bird's nest with a hatched egg.

Our recently released report, “10 Trends Shaping the Future of Food in 2022,” explores ten trends that are driving the transition to a climate-smart, healthy food system. Throughout the year we will dive deeper into these trends through our blog and podcast. In this article, in honor of Earth Day’s theme Invest In Our Planet, we explore food waste solutions and their potential to mitigate climate change.

"Technologies are being developed and applied to increase both productivity and full use of food in manufacturing and distribution. Standards will be set and brands will be built that offer the customer a clear choice to support upcycling and the reduction of food waste.”

- Walter Robb, former co-CEO of Whole Foods Market and S2G Ventures Senior Executive Partner

It’s difficult to wrap one’s head around 1.3 billion metric tons. It is the weight of 22.5 Great Walls of China, 197 hoover dams, and 130,000 Eiffel towers. It is also the weight of the food wasted globally every year.

Food waste happens at every stage of the supply chain, with inclement weather, overproduction, distribution and processing issues, and uncertain markets leading to losses even before the food arrives at retail locations, while overstocking, overbuying, and confusion over labels result in food waste in stores and homes. The source of the most significant loss differs worldwide. More than 40 percent of food loss in developing countries occurs at the post-harvest and processing stages, while in industrialized countries, more than 40 percent of food waste occurs at the retail and consumer level. In the US, our modern supply chain, which prioritizes efficiency and variety, exacerbated the issue over the last half-century resulting in the amount of food ending up in landfills nearly tripling between 1960 and 2020.

Due to the far-reaching consequences of food waste for all populations, from economic to social and environmental, it is increasingly viewed as a critical area of focus and opportunity for innovation for governments, businesses, and nonprofits. And because there are so many ways in which food waste occurs, we need a wide range of solutions and an array of technologies to make an impact.

Piles of produce, such as tomatoes and apples, being composted

Waste Not, Want Not

The economic ramifications of food waste are staggering. Those 1.3 billion metric tons of food wasted every year equate to $936 billion in economic losses. The US alone spends $218 billion a year or 1.3 percent of GDP producing, processing, and transporting food that is never eaten. The social consequence is that 1 in 8 Americans struggle to put food on the table despite there being more than enough food to go around.

In addition to the economic and social implications, wasted food has an incredibly consequential and underappreciated environmental impact. According to an IPCC report, from 2010 to 2016, global food loss and waste accounted for 8-10 percent of total anthropogenic greenhouse gas (GHG) emissions. If food waste were its own country, its emissions would rank third after the US and China. These emissions result from growing, processing, and transporting food, and the methane generated when discarded food ends up in landfills. Methane has about 90 times the warming potential as an equivalent amount of CO2. Additionally, food waste represents a loss of already scarce resources, with 30 million acres of cropland and 4.2 trillion gallons of water used to produce the food wasted in the US annually.

Food waste is much more than just a sum of its consequences; it also represents a massive economic opportunity. According to Future Market Insights, the food waste market is valued at nearly $53 billion and is projected to grow at a compound annual growth rate (CAGR) of 4.6 percent to reach $83 billion by 2032. A 2020 analysis conducted by ReFED, a nonprofit working to end food waste and loss in the US, found that investments to halve food waste by 2030 would result in a 5-to-1 return in addition to creating thousands of jobs, reducing greenhouse gas emissions and water and land use, and saving billions of meals.

Today, efforts to reduce food waste are already bearing fruit. A study by Champions 12.3, a group of executives across sectors dedicated to reducing food waste, analyzed 700 food and hospitality companies in 17 countries that took actions to reduce food waste and found that the median return on investment was 14 to 1.

Adding to the momentum are the commitments countries worldwide have made to reduce food waste. The UN aims to halve global food waste by 2030. In 2012 the European Parliament passed a resolution to halve food waste in the EU by 2025, while in 2015, the US government declared a similar 50 percent food waste goal by 2030. Food waste solutions also have something that has become increasingly rare–many garner bipartisan support. A bipartisan U.S. House Food Waste Caucus is looking at ways to reduce food waste across the supply chain. Last year Senators Pat Toomey and Richard Blumenthal introduced the Food Donation Improvement Act, a bipartisan bill that would expand liability protection for donated food to reduce food waste.

Innovations Across the Supply Chain

Since food waste involves a complex set of inefficiencies, we need a comprehensive suite of innovations to address it. In this article, we focus on prevention and recovery solutions that can stem the flow of food waste before it gets thrown out. Still, we recognize that recycling solutions such as composting and energy production are also essential tools for combating food waste and hope to cover those themes in future articles.

Inventory Management

One of the leading causes of food waste across the supply chain is a lack of demand planning and effective inventory management. For example, restaurants, grocery stores, and foodservice companies account for 40 percent of food waste in the US due to administrative mistakes, spoilage, theft, and other losses. These inefficiencies cost the grocery industry more than $50 billion a year in lost profits.

Artificial intelligence (AI) can enable extremely nuanced demand planning and help track waste across the supply chain. In terms of demand planning, an AI-fueled inventory management system can process hundreds of factors that influence demand and create accurate forecasts to help grocers and restaurants order and stock with greater precision. Machine learning algorithms can continue to improve accuracy over time by defining the relationship between various factors and a product’s sales. Probabilistic forecasts can weigh the risk of spoilage against the risk of selling out for each unit that will be shipped to a store. According to ReFED, improving demand planning by optimizing inventory management and forecasting systems can create $5 billion in net financial benefit for retailers.

AI can also enable detailed waste tracking that offers retailers insights into which products they are throwing away and when and why that waste occurs. Technologies that quantify, categorize, and pick up patterns in food waste can help companies optimize their supply and offerings based on data. For example, by using Afresh's AI-based platform, retailers have avoided wasting 6.9 million pounds of food. Waste tracking and analytics can help food service and restaurants generate over $1 billion in additional profit through reduced food purchases costs and divert 571,000 tons of food. In addition, AI can enable retailers to offer dynamic rather than fixed pricing for perishable food products. McKinsey estimates that AI can generate an economic opportunity of up to $127 billion a year by 2030 by designing food waste out of the system.

Woman looking at Flashfood app on phone
Image courtesy of Flashfood

Food Recovery Platforms

To successfully facilitate food waste recovery, companies with food at risk of going to waste need to be able to transfer it to other companies or individuals who have a use for it. This requires creating new connections in the food supply chain where there are currently missing linkages. Digital platforms, which have grown in popularity in recent years, are being used to bridge these food system players. Digital platforms can enable supply chain redesign and the formation of novel connections that can allow for the rescue and use of food that would otherwise go to waste. These platforms benefit players across the supply chain. Farmers, retailers, and restaurants make money from food that would otherwise be thrown away while consumers are turning to apps to access discounted food, especially as food costs continue to rise.

In addition to enabling new connections for food transferal, platforms can also educate consumers about the economic, environmental, and social importance of reducing food waste or remove pre-existing beliefs around food waste recovery. Platforms can also introduce new tools into a company’s production, logistics or marketing processes. For example, retailers may be able to integrate food waste management software into their existing food management practices to make offering food waste a seamless process.

Digital platforms can facilitate numerous kinds of connections across the food supply chain such as between food businesses, between food businesses and consumers, between food businesses and charities, and between consumers. For example, a number of business-to-business and business-to-consumer operations are working on getting retailers and consumers to think differently about ugly produce that would otherwise go to waste due to traditional supply chain standards.

Additionally, a number of app-based companies are helping consumers access discounted food nearing its expiration date. Our portfolio company Flashfood is a mobile marketplace that enables shoppers to save on fresh items such as dairy, meat, produce, and baked goods as well as non-perishables. They can purchase directly through an app and pick up their order from a designated Flashfood zone inside the store. So far, the company has diverted 30 million pounds of food from landfills and has saved shoppers almost $90 million in grocery bills.

Plums and avocados
Images courtesy of Hazel Technologies and Apeel

Smart Packaging

Food packaging has received a lot of flack for the waste it produces, but imagine if packaging could help companies track food along the supply chain and improve shelf life to reduce food waste.

Active packaging modifies the condition of foods to combat spoilage and improve their sensory or safety properties. While not a new concept, it holds new potential for food preservation because of recent advances in packaging, biotechnology, and material science. Solutions include packaging technology that removes oxygen in the product, antimicrobial packaging, ethylene scavenging to limit the overripening of produce, moisture migration technology to delay staling in baked foods, and packaging designed to reduce flavor loss.

Active packaging also enables more operational flexibility. If farmers, retailers, and consumers have more time before food spoils, they are less vulnerable to changes in their operations or the supply chain.

Today they are a wide range of active packaging technologies aimed at reducing food waste at various stages of development. For example, S2G portfolio company Hazel Technologies uses sachets that release shelf life-improving vapors to slow food spoilage during transit and storage. Hazel’s products can triple the shelf life of fruits and vegetables. The company is working with about 160 companies in 12 countries, including Mission Produce, the world’s largest Haas avocado producer, and Zespri, the largest distributor of kiwi fruit. From the company’s founding in 2015 until the end of 2021, Hazel estimated that it saved almost a billion pounds of produce from going to waste.

While Hazel focuses on sachets, S2G portfolio company Apeel is adding a layer of plant-derived protection directly to the surface of fresh produce to slow the progress of the causes of spoilage such as oxidation and water loss. As of last summer, the company prevented 42 million pieces of produce from going to waste in retail stores.

As opposed to active packaging which directly preserves food, intelligent packaging enables tracking and monitoring of food which can ease decision making and improve supply chain operations, thereby increasing shelf life. Intelligent packaging can take the form of indicators and sensors that provide real-time information on the state of the food and its surrounding environment, and data carriers such as RFIDs that provide information or control the flow of food products. Intelligent packaging can also enable retailers to incorporate dynamic expiration dates on packaging instead of estimated dates based on probable storage conditions and outcomes.

While these technologies have yet to penetrate the market because of the high implementation costs and challenges in translating them to the real world, they have great potential to transform food packaging to benefit consumers, manufacturers, and retailers. According to Supply Chain Dive, applying sensory technology to increase traceability could reduce food waste by at least 5 percent within the supply chain.

Coffee beans and coffee in a can being poured into a glass
Image courtesy of Atomo


Food production and processing generate a significant amount of byproducts which usually get discarded, even though some of what is leftover contains valuable nutritional components. There is a growing movement to take these byproducts and turn them into new food items that can then be marketed and consumed. The Upcycled Food Association defines upcycled foods as foods that “use ingredients that otherwise would not have gone to human consumption, are procured and produced using verifiable supply chains, and have a positive impact on the environment.”

Several economically viable upcycled products are already in stores. Pomace, the fibrous parts leftover from fruit production, is used to improve the flavor and nutrition content of snack foods. Protein leftover from cheese production becomes the protein content in health bars and shakes. Unsold bread is being used as the fermentation substrate in craft beer and flour is being made from the pulp byproducts of almond and soy milk production.

S2G portfolio company Atomo produces coffee without using any coffee beans. Instead, Atomo uses upcycled ingredients to reverse engineer coffee’s aroma, flavor, color, caffeine content, and mouthfeel. A mixed formula of upcycled seeds, pits, leaves, and stems make up the molecular coffee. Ingredients include grape skin, date seeds, and chicory root, all raw materials that are often tossed away. Atomo is also partnering with US farmers to upcycle their plant waste creating new value chains for producers.

The potential for upcycling companies to take advantage of discarded ingredients and tap into an increasingly environmentally minded consumer base is growing quickly. The Upcycled Food Association launched a new Upcycled Certification Standard in 2021 so companies can highlight their products that incorporate upcycled ingredients and reduce food waste. According to food AI company Spoonshot, interest in upcycling grew by 128 percent across business media in the past year. A report by the Future Market found that the upcycled food market is worth $46.7 billion with an expected CAGR of 5 percent over the next ten years.

Food waste reduction is unusually low-hanging fruit in the spectrum of solutions we have to mitigate climate change. According to Project Drawdown, reducing food waste is one of the top solutions for reducing carbon emissions. It has the potential to draw 87 gigatons of CO2 out of the atmosphere which is significantly more than other solutions such as a global plant-based diet (64 gigatons), electric cars (12 gigatons), and even utility-scale solar panes (42 gigatons). And it is an issue in which everyone truly has a part to play.

There is no panacea for food waste. We need all hands on deck. Effective solutions will require collaborations between different parts of the food and ag sector and between businesses, consumers, governments, research institutions, and nonprofits. Companies such as Flashfood, Hazel, Apeel, and Atomo are examples of the power of partnerships between stakeholders and between tech companies and supply chain players to chip away at food waste. We know there are so many other impactful solutions out there, and we hope to continue finding ways to support and facilitate solutions that can come together to make food waste a thing of the past.

Food Waste Innovation: Good for Business, Essential for the Earth

Food Waste Innovation: Good for Business, Essential for the Earth


Tonya Bakritzes

Managing Director

Tonya Bakritzes is a Managing Director on S2G Ventures' Platform Team where she oversees the fund’s brand strategy, marketing and communications and provides strategic guidance to the fund’s portfolio companies.


Josie Lane

Art Director

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