General Mills is a $34 billion company with annual sales of almost $19 billion. The corporate giant isn’t the kind of company that you would expect to be involved in crowdfunding.
But it is. Today, the company behind Cheerios and Yoplait today announced a multimillion-dollar fund through its new business development and venturing unit, 301 INC, that it will invest in early stage consumer product startups on the equity crowdfunding platform CircleUp.
CircleUp, which has had 120 companies raise more than $135 million on its platform, is a goldmine of product discovery for General Mills and will essentially serve as a de-facto research and development arm for the food maker. After all, it can be hard for towering corporate titans to be nimble enough to get an ear to the ground.
“The CircleUp marketplace will enable us to quickly connect with mission-driven brands actively seeking early-stage funding support,” said John Haugen, vice president and general manager of 301 INC, in a statement announcing the investment fund.
In addition to cash, startup entrepreneurs that receive investment dollars from General Mills will get access to the braintrust of the supply chain, finance and marketing departments of the consumer products giant.
The General Mills-CircleUp partnership is not the first time a corporate giant has experimented with crowdfunding. Indeed, a couple of years back, Procter & Gamble also partnered with CircleUp, as did Johnson & Johnson. Meanwhile, office big box retailer Staples searched for innovative new products on crowdfunding platform Fundable.
The secret these companies are starting to catch onto is that crowdfunding isn’t just about the money; it’s a second-to-none way to conduct market research. Consumers only put their hard-earned pennies behind products and companies they are seriously into, providing lessons for brands of all sizes.Related: Staples Wants You to Crowdfund Your Way Onto Its Shelves