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Daily news and analysis about the food tech revolution

Funding

PeakBridge and EIT Food Launch FoodSparks, a New European Agri-Food Tech Investment Fund

Venture fund PeakBridge and the European Institute of Technology (EIT) Food announced today the launch of PeakBridge FoodSparks, a new fund that focused on European seed and early-stage agricultural and food tech startups.

The new fund will invest up to €30 million Euros (~$35.7 million USD) over the next four years. FoodSparks will look to invest in roughly 10 European startups per year, with a check size of €500,000 (~$595,000 USD). According to the press announcement emailed to The Spoon, startups interested in receiving funding must be domiciled in Europe/EFTA and Israel, and have “protectable and scalable technology, and align with EIT Food’s mission of making the food system more sustainable, healthy and trusted.”

PeakBridge explained to me in a phone call last week that they are not looking to invest in CPG companies, but rather in companies creating innovative technology. In addition to funding, recipients will also receive access to advice and mentorship from the EIT food community.

FoodSparks is certainly launching at the right time, as investment in agrifood tech has never been higher. According to data from PitchBook, food tech companies raised more than $4 billion in Q4 of 2020. And recently released numbers from the Good Food Institute show that there was $3.1 billion invested in just the alternative protein space throughout 2020.

We’ve actually seen a lot of funding activity in the European agrifood tech space just since the start of the year. In particular, online grocery has seen massive funding rounds for delivery startups like Gorillas, Glovo and Getir. And a number of European cell-cultured meat startups have received funding this year including CellulaREvolution, Mosa Meat, Mirai Foods, and Future Meat.

The FoodSparks fund will be managed by PeakBridge Manageing Partner, Yoni Glickman. Investors in the fund include Ordway Selections, CPT Capital, Givaudan, Puraot and Gullspång Re:food.

Gathered Foods, Maker of Good Catch Secures $26.35M for Plant-Based Seafood

Gathered Foods, which makes the Good Catch brand of plant-based seafood, announced today that it has secured $26.35 million in a B-2 bridge funding round from investors including Louis Dreyfus Company, Unovis Asset Management and Big Idea Ventures.

This new financing follows the $36.8 million Series B round the company raised in January 2020. With the B-2 round, Gathered Foods has raised more than $75 million to date.

The Good Catch brand currently offers lines of plant-based fish products, including tuna, frozen fish burgers, fish cakes and crab cakes. Good Catch has a distribution partnership with Bumble Bee Foods and its products are currently available in the U.S. and Canada as well as in various European countries.

While plant-based burgers from the likes of Impossible Foods and Beyond Meat grab most of the headlines, we’re starting to see more plant-based seafood products enter the marketplace. Revo Foods (formerly Legendary Vish) is launching plant-based salmon strips and salmon spread, and is developing a 3D-printed plant-based salmon filet. Tyson-backed New Wave Foods launched a plant-based shrimp product last month. And Ocean Hugger is back, making its plant-based eel and tuna after ceasing operations because of the pandemic.

All of this activity is buoyed by the fact that the entire plant-based food sector has seen rapid sales growth over the past couple of years. According to recent data from the Good Food Institute and the Plant-Based Food Association, retail sales of plant-based foods hit $7 billion in 2020, growing 27 percent over the past year, nearly two times faster than total U.S. retail food sales.

In its funding announcement today, Gathered Foods said it will use the new funding to ramp up product innovation, increase the number of products it offers and fuel international retail expansion.

Bartesian Raises $20M Series A for its Countertop Cocktail Appliance

Bartesian, which makes a pod-based countertop cocktail appliance, announced today that it has raised a $20 million Series A round of funding. The round was led by Cleveland Avenue, LLC, with participation from Stanley Ventures.

The Bartesian device has cannisters that you fill up with liquor such as tequila, vodka or rum, which it then mixes with a variety pods that contain different flavorings, juices and bitters. Place a glass underneath and push a button and Bartesian dispenses a perfectly mixed cocktail.

By next-gen kitchen appliance standards, Bartesian is a downright old timer. The product launched on Kickstarter back in 2015, where it raised more than $115,000. In 2018, Bartesian decided that it was in the drink business and not the hardware business and licensed manufacturing to Hamilton Beach. The first units started shipping to Kickstarter backers later that year and became more widely available at retail in December of 2019.

According to today’s funding announcement, the Bartesian system has served more than five million cocktails, experienced 975 percent year-over-year revenue growth in 2020, and grew its subscriber base 30x compared to March 2020.

Without actual numbers, those stats aren’t super helpful in determining the actual success of Bartesian, and one has to wonder how much the pandemic helped boost interest and use in the Bartesian. With bars and restaurants closed and people relegated to their homes throughout much of last year, having a robot bartender like Bartesian on your counter made a lot of sense. With vaccination rates accelerating, bars and restaurants re-opening, and people being able to once again hangout in person, will consumers still want a home drink system?

Ryan Close, Founder and CEO of Bartesian told me by phone this week that while his company did get a COVID bump, it was already experiencing triple growth rates prior to the pandemic (they got off to a nice start by being an Oprah pick in the winter of 2019). Close said that the company has generated more sales in the first quarter of 2021, than it did during the first half of 2020.

The competitive landscape has also changed for Bartesian over the past couple of years. Drinkworks, which is a joint-venture between Keurig Dr Pepper and Anheuser-Busch InBev, and is also a pod-based drink machine, has been rolling out to different states across the country throughout the past year. And Barsys, which foresakes the pods for straight bottle attachments, is another option for the automated cocktail curious.

The one thing going for pod-based setups like Bartesian and Drinkworks, however, is the ability for people to have a full bar in their homes, without a collection of bottles taking up a lot of space. It’s much easier to store a bunch of flavor pods than a variety of juices, bitters and other drink ingredients. Plus, when people do have parties again, guests can easily make themselves a variety of cocktails with little to no mess.

With its new funding, Bartesian says that it will accelerate its growth domestically and internationally, scale up its production and expand its team. One of the investors, Stanley Ventures, is the venture arm of hardware company Stanley Black and Decker, which, Close said, is looking to bring Bartesian to Europe.

Bartesian also announced today actor Mila Kunis has joined the company’s board of advisors to provide guidance on brand strategy and growth.

Indian Food Delivery Startup Swiggy Raises $800 Million

India-based food delivery startup, Swiggy, has raised an addition $800 million in funding, The Economic Times reported today. The round was led by Falcon Edge, Amansa Capital, Think Investments, Carmignac and Goldman Sachs, with participation from new investment from sovereign wealth funds Qatar Investment Authority and GIC of Singapore. This brings the total amount of funding raised by Swiggy to roughly $2.4 billion.

India went on a severe national lockdown during the pandemic last year and Swiggy reportedly saw its daily business drop to processing fewer than one million orders a day, down from three million prior to the pandemic. The strict measures forced Swiggy to cut more than 2,000 jobs and scale back on its ghost kitchen ambitions.

But the Economic Times writes that food delivery was designated an essential service by the Indian government and that since then, both Swiggy, and its rival, Zomato have rebounded. Each company recorded their highest levels of business on December 31.

In an internal email sent out to the company (and viewed by The Economic Times) announcing the new funding, Swiggy Co-Founder and CEO, Sriharsha Majety wrote:

The fundraise gives us a lot more firepower than the planned investments for our current business lines. Given our unfettered ambition though, we will continue to seed/experiment new offerings for the future that may be ready for investments later.

With its new funding, Swiggy is now valued at $5 billion. The fundraise and new valuation come as Zomato, which is valued at $5.5 billion is prepping to go public later this year.

Grocery Apps Remain Popular with VCs as Everli, Nice Tuan and Zapp Raise Money

Given the frothy state of funding, it feels like there is a giant online supermarket stocked full of grocery-related startups and VCs are just wandering the aisles, filling up their baskets with companies promising to revolutionize the way we get our food.

At the beginning of March, we wrote about a single 12-hour period in which four grocery startups got funding (Instacart, Crisp, Rohlik and Flink). And it seems that VCs were just getting warmed up. Since that day, we’ve seen a number of grocery startups raise money including Stor.AI, Fridge No More, Jiffy, Shelf Engine, Weee!, Gorillas, Getir and GoPuff.

That list has grown once again this week as three more grocery startups have raised rounds of funding:

Everli, which is kind of like a European Instacart facilitating grocery pickup and delivery from local stores, raised a $100 million Series C round of funding led by Verlinvest (hat tip: TechCrunch).

Nice Tuan, a Chinese app that focuses on community grocery shopping received a $750 million investment round led by Alibaba Group Holding and DST Global (hat tip: Deal Street Asia).

Zapp, a London-based operator of delivery-only stores has received an undisclosed round of funding, TechCrunch reports from multiple sources.

There are couple things of note from this round of news. First is that European speedy delivery startups remain popular with investors right now, especially London-based ones. Zapp faces competition from the likes of Weezy, Jiffy, Getir and Gorillas.

Second is that these funding rounds are no joke. Nice Tuan’s $750 million haul follows fellow Chinese grocery app Xingsheng Youxuan’s $2 billion funding round in February. In the U.S., goPuff raised $1.5 billion, In Europe Gorillas raised $290 million and Getir raised $300 million (evidently startups starting with the letter “G” are also popular).

How long with this frothiness continue? That’s unclear. Will startups like Weezy or Fridge No More, whose funding is only in the double digit millions feel pressure to raise more to compete? And what about the overall grocery delivery space? The pandemic forced record amounts of grocery e-commerce, but a market correction is predicted for this year bringing those numbers back down to earth. But many of these startups are looking to change the way we grocery shop altogether by turning it into more of an always-on utility. Will people adopt speedy delivery as their new norm?

We don’t have a particular crystal ball for that, but we at The Spoon will chronicle it all as the market unfolds.

Turkey: Getir Raises $300M to Get People Groceries in Ten Minutes

Turkish on-demand grocery delivery startup Getir announced on Friday that it had raised a $300 million Series C round of funding. The new round was led by Sequoia Capital and existing investor Tiger Global, and comes just months after Getir finalized a $128 million Series B investment round. The company has raised $470 million to date.

Getir is part of the current crop of startups that promise super speedy grocery delivery. Getir operates a number of smaller distribution centers that are set up in different neighborhoods within a city. Users order items via an app and couriers are dispatched to complete deliveries in roughly 10 minutes.

In February, Getir expanded to offer delivery in London, and the company says it will use its new funding to expand into The Netherlands, Germany and France. But it will face competition as it does so, as a number of speedy grocery delivery startups in Europe have received funding recently. In London, Weezy and Jiffy offer similar services. And in Germany, Gorillas just closed a $290 million round last week for its own Euro expansion.

As we covered last week, all of these startups (plus the ones in the U.S. like GoPuff and Fridge No More) are all angling to change the way consumers view grocery shopping. By providing delivery in 10 minutes or less, companies essentially turn groceries into a utility that is available on tap. Shoppers could literally get groceries multiple times a day to fulfill a need or even just on a whim because they want something.

It’s still very early stages for all of these startups however, and it remains to be seen if and how customers will respond to such a service, and how far these types of services can scale. Can speedy delivery only work in dense urban environments? And as more players compete, how many micro-groceries stores does one neighborhood need? Given the rate of funding in the space, I assume we’ll find out pretty fast.

Cell-Cultured Fish Startup Bluu Biosciences Raises €7 million

Bluu Biosciences, a startup making cell-based fish, has raised a €7 million (~$8.24M USD) round of funding. TechCrunch was first to report the news, writing that Manta Ray Ventures, Norrsken VC, Be8, CPT Capital and Lever VC all participated in the round.

The Berlin, Germany-based Bluu is working on creating cell-based versions of salmon, trout and carp. Though there are more companies tackling the creation of cell-based beef and chicken, there is an emerging wave (pardon the pun) of startups making cultured fish protein. Bluu is focused on salmon, trout and carp. Here in the U.S. BlueNalu is working on cell-based mahi-mahi and bluefin tuna. And in Asia, the Hong-Kong-based Avant Meats is developing fish maw and sea cucumber, while Singapore-based Shiok Meats is making cultured shellfish.

Funding for cell-based protein startups continues to be heavy. A recent report from the Good Food Institute found that cultured meat startups raised $360 million in 2020. Just this week, Eat Just, which makes cell-based chicken that is actually for sale in Singpaore, raised an additional $200 million.

While cell-based fish products aren’t for sale yet, they are getting closer to market. BlueNalu is building out its pilot production facility, which will make 200 – 500 pounds of commercial grade cultured fish. Shiok plans to have it shrimp commercially available by 2022. And Avant recently announced a 90 percent cost reduction in the production of its fish maw.

All of this funding and progress is helping narrow the availability window of cultured meat products with some experts predicting it will hit price parity with traditional animal protein in five years.

Germany: Gorillas Raises $290 Million for its Dark Grocery Store Chain

Gorillas, which operates a chain of dark grocery stores that offer fast delivery, has raised a $290 million Series B round of funding, according to TechCrunch. The round was led by Coatue Management, DST Global, and Tencent, with Green Oaks, Fifth Wall, Dragoneer, and Atlantic Food Labs also participated. Gorillas raised a $44 million Series A round of funding in December of 2020.

The Berlin-based Gorillas is among a cohort of startups building out small, delivery-only grocery stores deep inside residential neighborhoods. Thess dark stores carry a limited inventory (that can be customized per neighborhood location), and have a limited delivery radius, so orders can be fulfilled and dropped off, usually in less than fifteen minutes. Gorillas currently operates stores in more than 12 cities across Europe including Berlin, Munich, Amsterdam and London.

A funding round this big and this fast following a recent Series A for a grocery related startup is not at all surprising. As noted, Gorillas is just one player in the speedy grocery delivery space. Similar startups in Europe that have recently raised funding include Weezy, Jiffy, and Flink. Here in the U.S., DoorDash is building out a chain of DashMart stores, Fridge No More is making deliveries in New York City, and GoPuff, which delivers many household items in addition to groceries, raised $1.5 billion this week.

As we have written a lot lately, the big question for these stores is whether they can scale. On paper, the ability to get last-minute groceries delivered in just minutes is great. But it also needs a certain population density to make the economics work, and we have yet to see those economics scale on a national level. If Gorillas can use its funding to do so, then it could become, well, an 800 lbs gorilla in the space.

Online Grocery Weee! Raises $315M Series D Round

Weee!, an online grocer with a focus on Asian and Hispanic communities, announced today that it has raised a $315 million Series D round of funding. The round was led by existing investor DST Global, with participation from new investors including funds managed by Blackstone, Arena Holdings, and Tiger Global. Weee! has raised more than $415 million in funding in total.

Founded in 2015, Weee! initially offered products for the Asian community, but the company recently added Hispanic foods to its roster. In its press announcement today, the company referred to itself as an “Ethinic Grocer,” and said it serves 14 key regions across the country. According to Weee! website, the company offers more than 3,500 products and has fulfilled more than 8.8 million orders.

Weee!’s funding comes during what appears to be salad days for investment in grocery-related startups. A raft of startups in the space have raised big funding amounts just since the start of the year. Part of the reason for all of this frothiness, of course, is the pandemic. With restaurants closed, and various lockdowns, record numbers of people turned to buying food online last year and retailers of all sizes scrambled to keep up.

What’s worth noting with Wee!’s funding is how the online grocery market is starting to segment. In addition to more general grocery startups like Instacart and Good Eggs getting funded, we are starting to see more focused startups raise lots of money too. Weezy and Fridge No More create hyperlocal stores that offer fifteen minute delivery, Imperfect Foods focuses on food surplus and rescue, and Weee! focuses on specific demographic audiences.

The question now is whether that is all money well spent. We’ve already seen a drop in the use of grocery e-commerce between January and February of this year. As more people get vaccinated and feel free to move about more, will they stop their online food buying habits in favor of getting out of the house and back into the store?

Wee!’s focus on serving Asian and Hispanic communities could actually help it weather any potential downturn in the grocery e-commerce market. By offering delivery of items that may not be stocked at general grocery stores in suburbs across the country, Weee! could become a go-to resource for Asian and Hispanic communities looking for particular types of food, but unable to get it at their local retailer.

With its new funding, Weee! says it will continue to add products and features and expand nationwide, with plans to reach 30 cities across North America by 2024.

GFI: $3.1 Billion Invested in Alternative Proteins in 2020, Tripling the Money Raised in 2019

While 2020 was a tumultuous year we’d all rather forget, it was actually a banner year for investment in alternative protein. According to new data released today by The Good Food Institute (GFI), there was $3.1 billion in disclosed investments in the alternative protein space in 2020. That figure is more than three times the amount raised by the sector in 2019.

GFI used PitchBook‘s data, and includes investments in startups working on plant-based meat, egg and dairy; cell-cultured meat; and fermented protein. Alternative protein is relatively new in the food-tech world, and investment in the space is definitely a steep hockey stick shape. The $3.1 billion raised in 2020 is more than half of the $6 billion alt protein companies raised between 2010 and 2020.

GFI broke down the data further, finding:

  • Plant-based meat, egg and dairy companies received $2.1 billion in investments in 2020, up from $667 million raised in 2019. The $2.1 billion in 2020 included the $700 million figure Impossible Foods raised, as well as LIVEKINDLY‘s $335 million in VC financing and Oatly‘s $200 million private equity financing.
  • Cultivated (a.k.a. cell-based) protein companies raised more than $360 million in 2020. This included the sector’s first two Series B rounds: Memphis Meat‘s $186 million raise and Mosa Meat‘s $75 million. GFI also included cell-based dairy companies such as Turtle Tree Labs and BIOMILQ.
  • Fermentation, the third pillar of alternative protein, pulled in $590 million in funding in 2020. This included Perfect Day‘s $300 million raise and Nature’s Fynd‘s $45 million debt round.

That the alt protein space was able to raise so much money in 2020 isn’t that surprising. First, there are just a ton of startups working in the space, so there is more opportunity for investment. And in areas like cultivated and fermented protein in particular, that technology is maturing, achieving more yield at lower costs.

GFI also noted that larger, existential factors helped drive investment in alternative protein. The pandemic highlighted issues with zoonotic disease transmission as well as ethical complications surrounding the production of animal-based meat. These pandemic-related issues along with problems with the animal meat supply chain helped drive a surge in plant-based food sales in 2020.

While 2020’s investment figures were impressive, I’m actually curious how this year will turn out. As we noted in our Future Food newsletter this week, there has been a raft of investment just in the cultured meat space since January. Will 2021 be another record breaking year for the alt protein space? Check back in next March to find out.

New Speedy Grocery Delivery Startup, Jiffy, Raises $3.6 Million

Jiffy, a new superfast grocery delivery service, announced today that it has raised £2.6 million ($3.6 million USD) in Seed funding. The round was led by LVL1 Group, with participation from AddVenture, TA Ventures, Vladimir Kholiaznikov, and angel investors Oskar Hartmann, Alexander Nevinskiy and Dominique Locher.

Jiffy’s hyperlocal stores will carry roughly 2,000 SKUs and offer 15-minute delivery with no minimums. Jiffy will launch this month in the London neighborhoods of Westminster, Waterloo, Lambeth, Battersea, Clapham Town, Shoreditch, Bethnal Green, Hackney, Whitechapel, Stepney Green, with another 20 stores planned to roll out across the U.K. later this year.

Rather than building out big or even medium-sized grocery stores, hyperlocal markets are small, delivery-only stores that are tucked away deep inside a neighborhood. They carry a limited inventory and have a small delivery radius, ensuring that orders can get to homes in minutes. Additionally, being hyperlocal means that products carried can be tailored to that particular neighborhood, making inventory management easier.

Hyperlocal delivery markets are becoming quite the trend. Jiffy is just the latest in a string of funding announcements for such companies. Weezy, also in the U.K., raised $20 million in January. Germany-based Gorillas raised $44 million at the end of last year. And just this week, Fridge No More raised $15.4 million for its hyperlocal stores in New York City.

The hyperlocal model is better suited to big cities, where a large population lives in a small delivery radius. Plus, delivering in compact urban neighborhoods means that orders can be fulfilled by someone riding a scooter or bike, rather than driving a full-sized car in traffic (and then needing to find parking).

If they catch on, hyperlocal markets are poised to change the way people shop for food (at least in cities). If they work as promised, they are essentially groceries-on-demand and reduce the need for weekly stocking up trips to the market.

Given the rate these types of stores are rolling out, we’re sure to find out if the hyperlocal approach works in a Jiffy.

Meal Prep Startup Meallogix Raises $1.7 Pre-Series A Round of Funding

Meallogix, an enterprise resource planning startup focusing on the meal prep sector, announced today via emailed press release that it has closed a $1.7 pre-series A round of funding. The round was led by Tech Coast Angels, with participation from Spark Growth Ventures. This brings the total amount raised by the company to $3 million.

Meallogix provides a software platform that helps take over the more administrative tasks associated with running a meal prep or meal kit company. The Meallogix software handles things such as shopping lists, prep lists, recipe management, meal planning, food labeling, supply costs and meal delivery logistics.

Meal kit companies experienced a resurgence during the pandemic last year. Unable to dine out and forced to eat at home more often, people turned to meal kit and meal prep companies to mix things up. During the height of the pandemic’s first wave in 2020, sales of meal kits doubled year-over-year.

But the question now is how much of the audience that flocked to meal kits will stay with them now that vaccines are aggressively rolling out. When restaurants are re-opened fully and people are able to move about more freely (not to mention the warm months of summer encouraging outdoor activities), will they still be interested in a meal kit subscription?

Meallogix is obviously still bullish on the meal kit and prep sector. In its press announcement today, the referred to a Nielsen statistic saying that 50 million people participate in meal kit and meal prep subscription, and that the market is projected to double to $11.6 billion by 2022.

Meallogix says it will be using its new funds to build out the front and back end of its software, expand its reach here in the U.S., and launch an online learning platform specific to the meal prep sector.