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Consumers love sustainable snacks. Investors, not so much

Illustration of  gold nuggets inside a fast food box

Illustration: Sarah Grillo/Axios

Sustainable snacks took top honors at this year's Specialty Food Association awards in Manhattan.

Why it matters: The honors underscore an apparent disconnect between consumers who say they want Earth-friendly eats and investors who have soured on the healthy-snack sector.

The latest: Salted butter from New Zealand's Lewis Road Creamery was crowned a "product of the year," in part for its environmental, animal welfare, and labor bona fides.

  • The other winner: vegan passion fruit mochi from NYC-based ice cream maker Mochidoki, featuring hints of coconut cream and oat milk.
  • In addition, the event featured breakfast cereal made from cornmeal byproduct and tonic water made with a yogurt maker's leftover whey.

Zoom out: The uptick in industry and consumer interest comes as venture investors have lost their appetite for food tech.

  • Among the factors: Product development is capital intensive and faces heavy regulation.

By the numbers: VC deal count and deal value in the space dropped from last year, per PitchBook.

  • Activity in Q1 was down 33% to 1,300 deals. Capital invested dropped 65% to $15 billion.

Of note: Food tech is an imprecise category, covering e-commerce and restaurant tech in addition to sustainability categories like food production and alternative proteins.

👀 What we're watching: Lab-grown chicken is finally on the menu at U.S. restaurants after years of regulatory review. We'll see if investors start salivating again.

1 nomenclature thing: Vegan foods are now, ahem, "plant-based," Axios' Jennifer Kingson writes.

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