Block Eatz counter, located at McKeithan Center at Cape Fear Community College North Campus. Food entrepreneurship article from Genesis Block
Block Eatz has a mission to support local food entrepreneurs, from ideation to commercialization with quality training, food production space and brand development.

“An entrepreneur tends to bite off a little more than he can chew hoping he’ll quickly learn how to chew it.” — Roy Ash

According to research from Massachusetts Institute of Technology (MIT), 60% of food businesses fail within their first year of operation. Even more alarming is that 80% of food businesses fail within 5 years of operation. These numbers relate to national trends but should be evaluated with deeper analysis by new founders, business owners, local economic development policy makers and community stakeholders.

So why is strategic investment into local food systems driven by food entrepreneurship critical for sustainable economic development and community prosperity?

According to VisitNC Economic Studies, in 2022 visitors to New Hanover County spent over $323 million dollars in restaurants, food trucks, breweries and other food and beverage establishments.

According to VisitNC Economic Studies, in 2022 visitors to New Hanover County spent over $323 million dollars in restaurants, food trucks, breweries and other food and beverage establishments. This places New Hanover County seventh out of one hundred counties as it relates to the visitors spend in food and beverage categories. Local entrepreneurs and small business owners play an important role in supporting the hospitality economy in the Cape Fear region.

Policies and initiatives to support the development of founders and companies in this sector are critical to sustainable local economic development, healthy food systems and thriving downtowns.

Here are some key metrics demonstrating the economic impact of food and hospitality entrepreneurs in New Hanover County and trends related to food entrepreneurship and communities.

  • International and domestic visitors spent $323.16 million in food and beverage; $276.21 in lodging in New Hanover County in 2022
  • The hospitality economy in New Hanover County in 2022 employed 6676 individuals
  • Travel-generated and travel-supported businesses generated $38.9 million in local sales and property taxes
  • Food and restaurant sector is the top industry for new small businesses in the United States
  • 500,000 new food startups launched annually in the United States, expected to reach 650,000 by 2030
Commercial kitchen incubators and shared kitchens support local food businesses by providing the space and access to training needed for food entrepreneurs.

Food entrepreneurs play an important role not only in the routine functioning of our daily lives but also as key drivers of economic activity locally and globally. Developing environments for food startups to succeed is essential for policy makers particularly in hospitality areas. Given the convergence between food and health to produce prosperous communities, this cross sector collaboration is important for sustainable health initiatives.

So, why are food entrepreneurs critical to the local economy and community prosperity?

Medically prescribed meals are starting to gain traction in the healthcare industry as medical professionals are beginning to emphasize the importance of food in public health. 85% of U.S. healthcare spending stems from diet-related chronic diseases and it is estimated that medically tailored meals or food as medicine, could save $13.5 billion per year while preventing 1.6 million hospitalizations. Healthcare providers are beginning to understand the importance of local farmers and food service providers as critical allies in their mission to build healthy communities.

The farm to table food trend is driven by the consumer and their awareness of the environmental and social benefits of food sourced from local farmers prepared by local chefs in their neighborhoods. Food entrepreneurs at the farming, production and distribution stages are building local food systems that provide communities an alternative food supply chain closer to home.

North Carolina ranks in the top 10 of the hungriest states in the country. New Hanover County is estimated to have over 16,000 residents that are food insecure with Brunswick County having over 25,000 food insecure residents. Entrepreneurs developing scalable food options such as mobile catering units, food trucks, and local food apps are providing the innovation to address food insecurity.

For centuries, food has been the foundation upon which civilizations have organized economies, societies and trade with other populations. Developing sustainable food systems with food entrepreneurs leading the innovation gives communities the foundation for sustainable local food systems, thriving arts and entertainment districts for high quality of life and pathways for healthy communities.

The Cape Fear region needs a food innovation campus to support space for food businesses to grow, production facilities for testing and development and consumer packaging goods processing environments for businesses.

Here are some of the most important components necessary to build a sustainable local food system and food entrepreneurship system.

The Piedmont Food Processing Center (PFPC) formed in 2011 to provide commercial kitchen space for entrepreneurs in Alamance, Durham, Chatham and Orange Counties. Since then, this space has inspired 350 startups, launched five national brands and dozens of regional brands. The Cape Fear region needs a food innovation campus to support space for food businesses to grow, production facilities for testing and development and consumer packaging goods processing environments for businesses. North Carolina ranks 9th in the United States for agricultural output with over $14.9 billion in receipts in 2022. The Port of Wilmington is ranked as the most productive port in North America according to the Container Port Performance Index (CPPI). The Food Innovation Campus could serve as the physical infrastructure to support the integration of these existing economic assets to build a sustainable food system for business growth and community prosperity.

One of the biggest hurdles to entrepreneurship is the enormous risk that founders must take on in order to launch and grow the venture. Food entrepreneurs in particular face the rising costs of food, a weakening labor market and low margins when it comes to industry risks. Developing innovative, flexible and lower risk business models lower the barriers to entry for entrepreneurs. For example, Block Eatz deploys term flexible, shared revenue, shared costs and co branding business models to give food entrepreneurs lower risk models to launch new concepts or scale existing businesses. New investment models such as revenue share, shared costs, pay if forward scaling and others also remove risks for potential investment in food ventures.

Commercial kitchen incubators and shared kitchens support local food businesses by providing the space and access to training needed for food entrepreneurs. In order to get a better understanding of the gaps in services provided to food entrepreneurs in the Cape Fear region we had discussions with local entrepreneurs. According to surveys conducted from founders in our Jumpstart Academy and Wits Begin Incubator, space for food production in a permitted kitchen was consistently one of the top three challenges facing early stage food businesses. The most important resource needed to strengthen food ventures locally is investment in permitted food production facilities for founders to launch their food concept and production capacity to scale the business. The food business is one of the most regulated industries in the United States. Business owners must secure permitted commercial space and food production must operate in compliance with regulatory requirements for sustainability.

Block Eatz has a mission to support local food entrepreneurs, from ideation to commercialization with quality training, food production space and brand development. With food producers and food entrepreneurs playing such an important role in the formation of prosperous communities our aim is to help these entrepreneurs achieve higher success rates.

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