General Mills shuts down innovation unit, pauses venture investments

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Dive Brief:

• General Mills said it is closing G-Works, its in-house innovation unit, and pausing additional outside investments by its venture capital arm 301 Inc. 
• The cereal and pet food maker is “adjusting how we pursue new growth initiatives,” said Chelcy Walker, a General Mills spokesperson. The Minnesota Star Tribune reported that about 40 people will lose their jobs.
• Companies in the food and beverage space are cutting costs and boosting margins as consumers pull back on spending due to inflation and economic anxiety.

Dive Insight:

Walker said General Mills has rolled out a “new Strategic Growth Office,” leading the Cheerios and Blue Buffalo manufacturer to shutter G-Works and pause new investments by the 13-year-old 301 Inc. unit. She did not offer additional details on the new initiative.

G-Works’ portfolio includes low-carb pasta Carbe Diem, low-sugar food maker Good Measure and Doolies, which makes snacks tailored for digestion. Meanwhile, 301 Inc. has invested in companies such as precision pollination startup BeeHero, plant-based burger Everything Legendary and PetPlate, a meal delivery service for dogs. 

The change in General Mills’ investment strategy will not impact Carbe Diem or its current 301 Inc. portfolio, Walker noted.

Jeff Harmening, General Mills’ CEO, said last month at the Consumer Analyst Group of New York conference that the Minnesota-based company has stepped up its contribution from innovation in recent years. He said net sales from new product innovation are up nearly 20% this year.

“We're excited about our innovation pipeline, including several launches that have the potential to be significant growth contributions in fiscal 2026,” he said.

Last summer, General Mills named Asheesh Saksena as its chief strategy and growth officer.  Harmening said the former Gap and Best Buy executive “has consistently demonstrated a clear track record of driving growth across a range of industries.”