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Daily news and analysis about the food tech revolution

Afresh

Afresh Rolls Out Its AI-Powered Fresh Food Management System to 2,200 Albertsons

Afresh Technologies, a fresh food management technology company, has announced the rollout of its predictive ordering and inventory management platform to more than 2,200 Albertsons Companies stores in the United States, including Safeway, Jewel-Osco, Shaw’s, Vons and ACME. The platform, which helps store teams to better order and plan fresh produce inventory, reducing food waste and achieving superior freshness in their stores, was implemented within seven months, making it one of the fastest in-store technology rollouts in the grocery industry.

The Afresh platform also provides department managers with easy-to-use ordering tools that leverage real-time insights. The company’s CEO and co-founder, Matt Schwartz, said that “supply chain and store technology implementations typically require a multi-year transformation and radical overhauls,” but that Afresh and Albertsons Companies were able to complete the roll out of the system in just months.

Suzanne Long, Chief Sustainability and Transformation Officer at Albertsons Companies, said that “driving sustainability practices across Albertsons Cos. is essential to our business and the communities we serve. Our partnership with Afresh helps us improve ordering and better manage our inventory of fresh fruits and vegetables so our customers have access to fresher products, and we’re able to make meaningful progress toward achieving our goal to have zero food waste going to landfill by 2030.”

Afresh, which raised a $115 million series B in August (bringing their total funding to $148 million), has been gaining momentum over the past year. The company currently has its software in 3,000 stores in the US, including Heinen’s, Save Mart, Bashas, Cub Foods, and Albertsons.

Bite Ninja’s New Funding Shows Operational Efficiency Is What’s in for Restaurant Tech in 2022

Despite the constant flood of doomsday headlines as the dark clouds of recession gather overhead and consumer behavior regresses to the mean post-pandemic, not all news is bad news these days when it comes to restaurant tech. In fact, some startups seem to be doing just fine, particularly those whose mission it is to help restaurants save money.

Take Bite Ninja, who this week announced an $11.3 million funding round. The company allows fast food restaurants to outsource their drive-thru through Bite Ninja’s cloud-labor platform. Bite Ninja employees can remotely staff a drive-thru from their home anywhere in the country and can also work multiple drive-thrus during the course of their shift.

The ability to spread a single worker across multiple restaurants and treat drive-thru labor as an “elastic” resource that can be spun or down dynamically during the course of a day is a radical rethink of a core part of a fast food restaurant, coming at a time when most fast food restaurants are struggling to hire employees. According to the announcement, Bite Ninja is currently running trials at five of the top twenty quick-service chains in the US.

Other companies that help restaurants and retail become more efficient and bring cost-savings to operations continue to thrive and get new funding despite what many see as a large-scale downturn in food tech funding. For example, Galley Solutions, a company that helps restaurants more accurately predict and optimize their food inventory, raised $14.2 million this spring. Hyphen, a startup that is building plug & play automated makeline solutions, raised a $24 million Series A in February and saw additional follow-on investment by Chipotle in June. That same month, food waste reduction startup Goodr raised a $8 million funding round in early summer. Last month, Afresh, a company that enables food retailers to optimize their fresh food inventory and reduce waste, raised a $115 million series B.

If 2021’s restaurant tech funding was all about ghost kitchens and digital transformation, the big buzzwords for 2022 are operational efficiency and cost savings. Startups that can help streamline operations using automation, cloud computing, AI, and other transformational technologies will continue to do okay, particularly those that help restaurant operators deal with acute labor shortages and rising costs of doing business during rising inflation and persistent supply chain disruptions.

From Grad School Project to $115 Million Series B: Afresh’s Matt Schwartz on Building an Operating System for Fresh Food

While in graduate school Matt Schwartz had an epiphany.

At the time, he was learning about the food system as part of Stanford University’s Earth Program and also participating in an internship with food tech investor Dave Friedberg, and it was this combination of advanced education with a front-row seat to food tech innovation that helped him to see the future.

“That’s when I came to believe that things were heading towards fresh,” Schwartz told me this week in a Zoom interview. “That we need to move towards a more nutrient-dense form of eating, a less calorie dense form of eating, to be able to nourish the world sustainably. And those two things converged into saying, I want to accelerate this fresh technology thing.”

The focus on fresh food soon led Schwartz and his eventual cofounder of Afresh, Nathan Fenner, to do a graduate study in which they talked to close to one hundred people involved in the food supply chain. It wasn’t long before they realized that, despite the increasing importance of fresh food for food retailers, there wasn’t any technology optimized for managing it.

Afresh’s Matt Schwartz

“We were going to Safeway, to Trader Joe’s, all these large, mega multibillion dollar chains, and they were all running this process on paper and pen,” Schwartz said. “Some retailers that had taken center store, non-fresh technology, and worked with like an IT consulting shop to customize the hell out of it and bend it into the fresh categories. And in that case, you’d still see lack of adherence and ultimately, at the end of the day, because it wasn’t a fit.”

These findings led Schwartz to create a company that built technology focused on managing fresh food in Afresh. Their first product, a software solution for managing fresh food inventory that Schwartz calls a ‘fresh operating system’, has been adopted by grocers of all sizes, ranging from small regionals to nationwide retailers such as Albertson’s (the Idaho-based grocer plans to install Afresh’s technology in 2,300 stores by end of 2023).

And it’s that growth, in which Afresh went from 200 stores using its technology at the end of 2021 to an expected 2000 installs by the end of this year, that is no doubt one reason the company was able to raise an impressive $115 million series B funding round announced this week. The round, led by Spark Capital, brings the company’s total funding to $148 million.

When I asked Schwartz why so many grocers are eager to better optimize management of fresh food inventories, he pointed to how even a company like Amazon found fresh challenging.

“So you look at Amazon, they bought Whole Foods because their pure-play Amazon Fresh was struggling to make a business out of direct delivery. And they didn’t stop there. They opened up their own grocery chain. But really, it was a play to crack into fresh, which is this huge part of the retail market that they couldn’t get a piece of otherwise.”

According to Schwartz, in a world where more consumers are buying commodity food items online, it’s the fresh department that is becoming an anchor for the physical point of presence in food retail. And, despite fairly low overall waste rates compared to other parts of the food supply chain – roughly 4-6% of fresh food is wasted at the store compared to over a third once it arrives in the home – he believes the 25% or so reduction in fresh food waste grocers experience using their system results in significant savings to the grocer’s bottom line.

While Afresh’s technology – a SaaS product running on an iPad – doesn’t have all the bells and whistles compared to some of the robotics and machine vision systems other startups have rolled out to help grocers with inventory management, Schwartz sees a future where all of the technology will work together.

“Where this is going is that there are robot companies, there are computer vision companies that are counting inventory, there are shelf life extension technologies, there are vertical farms, there are cold chain compliance technologies, and I believe that this is all an interconnected trend of fresh first technologies that are coming together to solve this growing problem that is increasingly strategic.”

And naturally, Schwartz sees his technology at the center of it all.

“We think about ourselves as the brain, that software layer that’s going to connect all of those things together,” Schwartz said. “So when the robots know an inventory position, or the computer vision can estimate the quality of the product, or we know whether that a berry was in cold chain compliance or not, all of that data can best fit into our system and drive the best outcomes and decisions for the retailers.”

Afresh CEO Matt Schwartz Explains How AI Can Help Grocery Retailers Place “the Perfect” Order

For grocery stores, measuring demand and managing orders for fresh foods can be a maddeningly difficult task that more often than not ends in lots of unused food getting thrown out. After all, bananas have a much shorter shelf life than, say, a bag of rice, and a lot of existing supply-chain technologies and processes were designed with the latter in mind.

“Existing tools don’t work for fresh food,” says Matt Schwartz CEO and cofounder of a San Francisco, California-based tech company called Afresh.

Afresh often gets labeled a “food waste” company and listed among other efforts to curb the problem of food waste at consumer-facing outlets like grocery stores. While Afresh’s store-level ordering platform can certainly help grocery retailers cut down on food waste, that’s not necessarily the main driving force behind the company. 

Over a call recently, Schwartz told The Spoon he thinks of Afresh as more of a “fresh food company” than food waste company. The system uses AI to analyze store-level data around customer demand, shipments of fresh food, sales of it, pricing and other factors. Gathering all that disparate data together, the system then makes ordering recommendations for grocers to help them create what Schwartz calls “the perfect order.” That is, “an amount that keeps you in stock for the shopper but also doesn’t cause you to drive waste from having it sit there.”

By way of example, he says it’s the difference between 14 cases of blueberries and 18: “Those four cases make all the difference when it comes to billions of pounds of waste.” 

Getting that perfect number can be complicated. Continuing with the blueberry example, Schwartz says there are a few major things grocery retailers have to consider, the first of them being customer demand. In other words, How many blueberries will shoppers want over the next few days? Retailers also have to consider existing store inventory, which can be tricky to calculate for something like berries. 

Reconciling these two things — how much a retailer has versus how much they think they will sell, also requires other types of data. That includes how many cases the shelf can hold, the shelf life of the blueberries, and the frequency of shipments, to name a few. The Afresh system connects to grocery retailers’ existing systems, then compiles the above data into a single place that a retailer making an order can view from an iPad.  

“In the long term our systems will drive decisions around inventory, forecasting, etc.,” said Schwartz.  

In a recent post for The Spoon, food tech investors Seana Day and Brita Rosenheim noted that “increased workflow and data automation solutions in the food supply chain holds significant power to help the food supply chain leapfrog into digitalization.” That includes grocery retailers, and Afresh is among several companies trying to enable this leapfrog movement. Seattle, Washington-based ShelfEngine offers a similar fresh food inventory management platform, as does a company called Crisp. Rising consumer demand for both fresh food and a more reliable supply chain (hello, panic shopping) mean we can expect a lot more software in this area in the near future.

For its part, Afresh is currently live in hundreds of stores, says Schwartz. He declined to name specific stores or chains, but said his company’s biggest partner does about $10 billion in sales every year. 

The company has raised a total of $32.8 million to date, with its most recent round being a Series A fundraise towards the end of 2020.

Afresh Raises Another $13M to Help Grocers Manage Produce Inventory

Afresh announced today it has raised $13 million in new funding for its grocery retail management platform. The round, which is a Series A extension, was led by Food Retail Ventures with participation from existing investors Innovation Endeavors, Maersk Growth, and BaselineVentures. This brings Afresh’s total funding to $32.8 million.

San Francisco-based Afresh’s technology uses machine learning to analyze customer buying data for fresh produce and help grocery retailers forecast demand, which is harder to predict when it comes to perishable foods like fruits, vegetables, and breads. Grocery stores must order enough to meet customer demand, but not so much they are throwing out excessive amounts of unsold items and wasting both food and money in the process. Afresh’s technology helps grocery retailers forecast more precisely and order accordingly.

Right now there is a major need for this level of precision when it comes to grocery inventory. Panic-buying sprees at the beginning of the pandemic underscored some of the supply-and-demand shortcomings with grocery inventory systems. Afresh CEO Matt Schwartz told The Spoon earlier this year that “COVID was a test case” for the company’s overall structure. “Ultimately, we’re building the system for edge cases and supply interruptions,” he said.

At the same time, the world’s 1.3-billion-ton food waste problem grows more urgent each year. In the U.S. 40 percent of that waste happens in consumer-facing businesses like grocery stores and restaurants. In addition to helping grocers better manage supply and demand, Afresh’s platform can also help them cut the amount of waste they throw out (and save more money). 

The pandemic, the record levels of online grocery shopping, and the food waste problem are collectively making inventory optimization a big business for the grocery sector. Afresh’s funding comes the same week Farmstead, another AI-powered platform, raised $7.9 million. Crisp, based in NYC, offers retailers a similar platform.

Afresh’s latest funding round follows another Series A follow-on from July, that one for $12 million. The company said today it will expand its product to new markets and add new features in the coming months.   

Heinen’s Market to use Afresh’s AI-based Grocery Managment Software

Afresh announced today that its artificial intelligence (AI) platform for grocery retail management will be used by Heinen’s markets. Afresh’s software will be used in the fresh departments across Heinen’s 23 stores in Cleveland, Ohio and Northern Chicago.

Fresh food inventories (produce, bread, etc.) are trickier to manage for grocery retailers because of the perishable nature of those products. For stores, the goal is to have enough inventory on hand so they don’t run out (and lose sales), but not so much that the food goes bad on the shelves.

Afresh’s platform promises to use machine learning to analyze customer data and predict demand. With that knowledge, retail managers can better stock and manage their inventory.

Heinen is the latest public customer to adopt Afresh’s software, and the deal comes just one month after Afresh raised $12 million in funding.

Afresh isn’t the only company using AI to better manage grocery inventory. Crisp also uses data and AI to help grocers keeps their shelves stocked, and Farmstead is a Bay Area-based online grocer that is built around just-enough inventory managment.

Given that Afresh’s platform looks at consumer data, and that the COVID pandemic abruptly shifted grocery buying habits on a national scale (food shortages, record online grocery shopping), I asked Afresh CEO Matt Schwartz by phone this week if and how his product was affected.

“In some ways COVID was a test case for our overall structure,” Schwartz said, “Ultimately we’re building the system for edge cases and supply interruptions.”

Schwartz said that Afresh’s overall mission is to help grocers maintain steady inventory and weather sudden shocks to the system, so there aren’t barren shelves and people can get food, especially fresh food, when they need it most. Perhaps in a couple months Heinen’s will let us know.

Afresh Adds $12M in Funding for its AI Approach to Fresh Food Stocking at Grocery

Afresh, a startup that uses artificial intelligence (AI) to help grocery retailers manage fresh food inventories, announced today that it has raised a $12 million follow-on to its Series A round of funding. The round was led by returning investor Innovation Endeavors with participation from Food Retail Ventures, Maersk Growth, Impact Engine, Better Food Ventures and existing investor Baseline Ventures. This brings the total amount raised by Afresh to $20 million.

A grocery store’s fresh food sections (think: produce, bread etc.) are trickier to manage than the aisles of CPG products as fresh foods have a limited shelf life and expire. The goal is to keep a store stocked with enough product that they don’t run out, but not so much that there is a lot that goes to waste.

That’s where Afresh says its technology can help out. As we wrote previously:

Afresh’s technology uses machine learning to analyze customer data and forecast product demand. Retail managers can then use the Afresh software to order the exact amount of fresh food that they’ll need — no more, no less.

Of course, maintaining fresh food stocks in-store has only gotten trickier since COVID-19 hit in full force. When the pandemic first started here in the U.S., panic buying translated into lots of empty store shelves. Since then buying habits have shifted too, with record numbers of people buying groceries online. All of these new buying patterns need to be taken into account as we adjust to this current pandemic and brace for any resurgences of the virus.

Afresh isn’t alone in its mission to cut down on food waste and help grocery retailers better manage their inventories. Crisp uses data and AI to offer a similar service to grocers. And online grocer Farmstead is built around algorithms that help it predict and better manage its inventory.

Though the world seems to be in a continuous state of unpredictable flux, we all still need to eat. Hopefully technology like Afresh’s can help mitigate any future shocks to the food system.