We know, we know — food waste is an astronomical problem. The good news is, lately it has been getting quite a bit of press, and there have been a smattering of apps, agtech tools, improved food freshness labels, and other innovations (edible food sensors, anyone?) aimed at reducing the gobsmackingly high amount of perfectly edible food that goes in a landfill.
One of these is Karma, a Stockholm, Sweden-based app that helps retailers sell excess food directly to consumers at dramatically reduced prices. Karma launched in Sweden in November of 2016 and expanded into the U.K. in February of this year. So far, they have a grand total of 1,500 partners — including restaurants, cafes, hotels, bakeries, and grocery stores (300 of which are in the U.K.) — with roughly 350K end users across both markets.
Once they get set up with Karma, food suppliers can use the service to upload any surplus food that they would otherwise have to throw away. “We leave it up to them to allow the decision for what that means,” Alex Spain, VP of International Development for Karma, told The Spoon over the phone. The only requirement is that the food can’t be past its legal sell-by date.
Next, partners set the discounted price the food will sell for. The exact number is flexible, but Spain said that it has to be a minimum of 50% off. “We want it to make economic sense of something that would otherwise go to waste,” he said. “Otherwise, if it’s just 10-20% off, it’s in danger of just becoming a deals site.” Once the customer buys the food, they’re responsible for picking it up within a time window set by the supplier.
Joining Karma is free for both customers and retailers, and there are no binding terms for either party. The company collects a 25% transaction fee from the food provider on each purchase made through the app.
Spain told us that Karma is best suited to pre-prepared or packaged items such as sushi, salads, or sandwiches, but he added that it can also work for made-to-order food. He gave the example of lobster spaghetti; maybe a restaurant has a whole leftover lobster at the end of the day that they can’t use the next day, but they don’t want to sell a straight-up lobster in a bag. Instead, the chef will whip up a lobster spaghetti or other prepared dish to order when someone buys the crustacean.
The Karma app at work. (Photo: Karma.)
Karma isn’t the only app out there aiming to reduce waste by helping food establishments resell their surplus. In fact, they’re not even the only one in the U.K. Winnow tackles food waste from kitchen ordering and preparation, and Olio facilitates free food surplus sharing among neighbors and businesses. In the restaurant and retail sector, their most notable competitor is Too Good to Go.
Karma also targets higher-end restaurants, including ones with Michelin stars. They want to curate a high-quality offering for their customers. “There’s a risk that when you talk about surplus or waste, people worry it’s low quality,” said Spain. “We want to make it seem like they’re not just picking up leftovers; we’re just trying to optimize supply and demand.”
They also put heavy emphasis on transparency. With Too Good To Go, users don’t know exactly what they’re going to get; they just show up to the restaurant and get a portion of whatever they have left. Karma, on the other hand, makes it clear exactly what products the customer will receive.
Olio, however, takes a more C2C approach. It’s chiefly aimed at neighbors who can use the app to share extra food, surplus vegetables from their garden, or excess bread amongst themselves. For restaurants, Spain views Olio as complementary to his company’s service; cafes or grocery stores can use Karma first to resell as much food as they can, then turn to Olio to get rid of the remainder for free.
According to Spain, retailers who switch to Karma from other food resell apps see a spike in demand. At the same time, Too Good To Go has the upper hand in terms of availability; it’s currently active across 8 European countries, while Karma is only available in the U.K. and Sweden — at least for now.
Karma currently has a staff of 35, five of which are dedicated to the U.K. Last year, Karma raised a seed round of 4 million lead by Berlin-based company e.ventures. Spain didn’t yet know which market the company would launch next. But if the number of food waste reduction apps keeps increasing, hopefully Karma (and company) will continue to expand and, eventually, make a dent in the sobering global food waste problem.
Great article! Environmental projects and those who help make our world a better place are worth to share with others. We just spoke to them too: https://sealawards.com/food-waste-app-karma-interview/