System C: The Food System Reimagined

How System C Combines the Best of Taste, Health, and Affordability to Transform Nutrition and Healthcare

We have spent the week talking about systems, so we figured it’s time to start laying out a bit of framework in our thinking.

A Little Prologue

As we exited World War II, the US saw famine as a tool of tyrants to force their will on countries. To reduce conflict, global agriculture, with the help of US technology, boosted agriculture production. By 2010, the global food system achieved calorie parity, producing more calories than needed. Corn went from 20 bushels per acre in 1940 to recently 320 bushels per acre.

In the process, the $1.7T US food system, rich in calories and carbohydrates but weak in nutrition, triggered more than $1.9T in annual health care costs from poor nutrition. We avoided World War III, ended famine, and boosted chronic disease.

From 1945 until today, industry and policy have aligned to drive substantial systematic change. A great deal of good, with eventual consequences.

Food is Health

As we look forward in our effort to improve food and therefore health, how do we leverage the work of the last 70 years, building on the infrastructure of the global food system to make it better without destroying the good?

Which leads to our System A, B, and C framework…

System A

Adam and Eve, in the garden of Eden, had ready access to fresh and nutritious food. Humans evolved over 350k years. Surviving famine, viruses, climate change, winter, drought, and other threats. When they did have food, it was fresh vegetables, meat, fish, etc - all tasty and nutritious.

Today, System A is the best of our food systems. The freshest food and best meat are served in the best grocery stores. It seems out of reach to many because of cost and/or convenience. If you are close to the farm, it’s easier. If you are in a big city, it’s harder. Even if cost was not an issue, the scale of System A can not meet the calorie needs of 8.5B people. It delivers the proper nutrition but costs too much and does not scale.

System B

Born out of World War II, System B is today’s modern processed food system. It delivers calories at scale. Cheap. It trades nutrition for yield. It drives our agriculture systems to ruthless efficiency. Processed food is shelf-stable. Food is fortified. We take supplements. Food is engineered. Food is easy to access. The processed food is tailored to maximize desire and profits, helping to drive more scale. Science has said it is better. Science has said it is worse. We work to emulate evolution but seem to fall short. We no longer die young of famine, but still shorten life with chronic disease.

System C

As we look forward to Food is Health, our objective is to take the best of System A and the best of System B, to create a new food system that is:

• Nutritionally dense - providing the right macro and micro nutrients.

• Tasty - people want to eat it.

• Satiating - but they don’t want to eat too much.

• Scalable - it scales to 8.5B people, prevents famine, and maintains quality.

• Available - it survives the supply chain and minimizes waste.

• Affordable - it lowers cost at or below the price of system B.

Cheap Calories vs Affordable Nutrition

We live in a world dominated by System B: Cheap calories. It is so efficient that the companies in the food system are convinced that people love System B, giving up health for low-cost sugar. Worse yet, the conventional wisdom is that better food, System A, must cost more.

We disagree.

By our definition, System C delivers the quality of System A at the price of System B.

But how do we do this?

One answer is that in the U.S. we spend $1.7T on food and $1.9T on the healthcare cost of poor nutrition. Our real “Total Cost” of nutrition is $3.6T. If we eat better food, and prevent chronic disease, our overall affordability of nutrition costs less than System B + Chronic disease.

The more people understand the role of food in their health, the more they include the implications of healthcare in their purchase decisions. When people internalize this cause and effect, they alter their value decisions. This is the calculus of affordability.

We pay more for an iPhone, because it cuts the cost of our communications. Tesla is the most popular car in the world because it cuts the cost of fuel and pollution. Chronic disease costs each of us 300k-500k over our lifetimes. Would you spend more on food if it eliminated the cost of healthcare, reducing our total cost of longevity?

But better food does not necessarily need to cost more.

• The best regenerative farming lowers the cost of production and improves the nutritional quality of soy, wheat, fruits, and vegetables.

• Grass-finished beef reduces the cost of production, boosts taste, and improves the balance of Omega 3/6, reducing Cardio Vascular Disease.

• Ultra High Protein Soy improves farmer economics, increases poultry feed efficiency by 8%, removes anti biotics, and delivers higher quality protein in chickens at a lower cost.

• Automated weeding robots eliminate the need for GMO traits, roundup and toxins, allowing farmers to move to heritage grain crops with higher nutritional density and taste.

• New wheat genetics deliver pasta with 15g of fiber and great taste at school lunch program pricing.

In each case, a combination of farmers, processors, ingredients companies, CPGs, and grocery stores are collaborating to optimize a product to improve its nutrient qualities, often also reducing waste/inefficiency and increasing satity, which yields better nutrition and lower cost.

System C thinking is rethinking each step in a food product, from the dirt to your mouth, to deliver more nutrient quality at the cost of System B. It is already happening, and it’s working. The accumulation of all the recent agtech investments and shifting consumer focus towards food and health are enabling a shift to System C.

There are roughly 60k SKUs in a WalMart Super Center. Each product, from milk to cheetos, is an opportunity to move from System A or B, to System C.

System C is the path to Food is Health.