Beyond MAHA Politics: The Case For Investing in Food As Medicine
Four Trends Driving The $25B Food-as-Medicine Industry
Market Signals
$650 million: There were $650 million in raises and closes for regenerative funds and “regen adjacent funds” in Q1 of 2025, signaling an increase in interest by LPs in the sector.
88% of investors: 88% of investors globally are interested in sustainable investing, according to a report by Morgan Stanley. More than half of investors plan to increase their sustainable investment allocations next year.
One in five children: One in five children over six years old in America is obese, and the U.S. obesity rate is more than double that of its G7 peers, according to the report from the Make America Healthy Again (MAHA) Commission. See the graph below.
Investing in Food As Medicine
In May, the White House’s Make America Healthy Again Commission released a highly anticipated 68-page MAHA Report: Making Our Children Healthy Again.
The report painted a grim picture, declaring, “Today’s children are the sickest generation in American history in terms of chronic disease.” It also sparked backlash from some in the food & ag industry and drew criticisms about the science. You can read a brief summary of the report’s key takeaways here and read a critique of the report by friend of Trailhead Errol Schweizer here.
The principles underpinning the MAHA movement—like the concept of food as medicine—are not new. But they are garnering mainstream interest. Setting aside the politics, here are four secular trends we’re watching:
The industry is growing: The “food as medicine” industry in the U.S. is valued at an estimated $25 billion and growing steadily (projected 4.3% annual CAGR over the next decade).
Consumers understand the power of prevention: Nearly 90% of Americans believe eating healthy foods is essential for preventing obesity, high blood pressure, and Type 2 diabetes.
Food-as-medicine startups are raising rounds: There are venture-scale opportunities in food-as-medicine companies, functional health solutions, and personalized health technologies, with notable recent investments.
Big companies are investing: Big food companies see the opportunity: Coca-Cola launched a pre-biotic soda in February.
To make food a form of medicine, we need to start with the soil. Improving the nutritional density of the soil, eliminating synthetic fertilizers and pesticides, and implementing other regenerative practices can translate into better digestive health and a healthier microbiome in our gut. What starts in the soil ends with our body’s ability to heal itself.
There are investing opportunities along the entire food systems value chain—from financing farmers accelerating the transition to organic and regenerative (Mad Capital) to startups leveraging technology to identify healthy foods (Edacious and Index Biosystems). Trailhead’s portfolio is full of them, and we’ll be investing in dozens more in the years ahead.
Founder Fundamentals
How to find product-market fit. We’ve loved this series by First Round Review on product-market fit. They share behind-the-scenes breakdowns of how companies found product-market fit and what successful founders actually did in their earliest years. One insight that stood out to us: product-market fit isn’t a binary (where you either have it or you don’t). Instead, it exists in four levels:
Nascent: You have a handful of somewhat engaged and happy initial customers, but things still feel early and messy. Focus on increasing satisfaction.
Developing: You have more engaged, paying customers and less churn — you need to work on driving demand.
Strong: Momentum is picking up, and you're finally feeling the "pull" of demand. It's time to focus on increasing efficiency.
Extreme: You're repeatedly and efficiently solving an urgent problem for a large number of customers who need your product.
Portfolio Updates
An article in USA Today profiled Avalo’s work to leverage AI to help farmers produce more food with fewer resources. Meanwhile, a post in The Van Trump Report explored Avalo’s core technology: Gene Discovery by Informationless Perturbation.
Provision Analytics welcomed Jennifer Williams, Former head of food safety at Tyson Foods, to its Strategic Advisory Group.
Eric Smith, Founder and CEO of Edacious, went onto the RegenBrands podcast to discuss how Edacious is helping brands prove that regenerative products are more nutritious. Listen here. Separately, Edacious, The Bionutrient Institute, and Utah State University uncovered the relationship between farming systems, food quality, and human health in a new study on how production practices shape the nutrient density of beef.
What We’re Reading
How Tariffs are Shaping U.S. Agriculture. While organic and regenerative farmers may be insulated from tariff uncertainty due to their domestic market focus, the uncertainty from tariffs will impact transportation costs, consumer purchasing power, and lending conditions. Mad Agriculture.
Economic Sentiment in the Agrifood Industry. The Agrifood Economy Index, created by Purdue DIAL Ventures, measures economic sentiment by gathering insights across six industry segments. Agrifood Economy Index Q1 2025.
The Results From A Corporate Pilot of Regenerative Practices. In 2019, General Mills launched a regenerative agriculture pilot in Canada with 40 farmers. Six years later, they reported their results (70% of farmers were more profitable). RFSI.
New Research on Food Waste. According to a new study, the most effective way to get people to waste less food is not to push them to be sustainable, but to encourage them to eat healthily. Science Direct.
RFK Jr.'s Quest to Make Americans Eat Healthier Will Be Costly. Ultra-processed foods have made U.S. diets among the least expensive—and the most unhealthy—in the world. Bloomberg.
Agriculture Needs a Nature-Based Revolution Beyond Technology. Nature-based solutions aren’t anti-tech; they can scale regenerative practices. AgFunderNews.