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Daily news and analysis about the food tech revolution

Territory Foods

Territory Foods Raises $22M for its Chef-Created Prepared Meal Subscription Service

Territory Foods, a marketplace where local restaurants can sell their meals for delivery via subscription, announced yesterday that it has raised a $22 million Series B round of funding. The round was led by U.S. Venture Partners, with participation from Upfront Ventures, Lewis & Clark Ventures, DF Enterprises, S2G Ventures, Gaingles, Middleland Capital, Finistere Ventures and Rethink Food Capital. This brings the total amount of funding raised by the company to $44 million.

Territory is a different from other fresh meal delivery services in that it partners with and sells meals from local chefs and restaurants as a weekly subscription. So instead of going to a restaurant once or twice a week, a customer can choose to order a number of meals in advance. The meals arrived prepared and packaged up, so they only need to be re-heated, adding to the convenience factor.

The company’s subscription service really became important during the pandemic last year, as restaurants were forced to close their dine-in operations. Territory offered those restaurants and chefs an added revenue stream by creating and assisting with this D2C shipping channel. The chefs and restaurants make the meals and Territory takes care of all the logistics like ordering, packaging and delivery. Not only could Territory provide more orders, but those orders were also frontloaded and batched. This smoothed out revenue volatility from night to night and gave chefs more time to prepare.

In addition to creating another sales channel for chefs and restaurants, Territory can also extend their geographic reach. A San Francisco restaurant may only deliver hot meals to certain neighborhoods, but Territory can delivered the packaged versions meals more widely throughout the Bay Area.

As we come out of the pandemic, one has to wonder what will happen to prepared meal delivery services like Territory Foods and Freshly (which was acquired by Nestlé). With the ability to once again eat out at restaurants — and with other people — will consumers still want to order a week’s worth of prepared meals? Or have they gotten so hooked on prepared meal delivery that they won’t let their subscription go? We’re about to find out.

Territory already serves 20 markets across the U.S. including Miami, Los Angeles and Washington D.C. The company told Crunchbase News that it will use its new funding to expand into new cities as well as invest in technology and food as medicine initiatives.

Territory Foods Lets Restaurants Package Pre-Made Meals for Subscription Delivery

A byproduct of this global pandemic is that restaurants are being forced to try new models to stay in business as people are increasingly told to shelter in place and social distance.

We’ve seen dine-in restaurants pivot to delivery and curbside pickup. But Territory Foods this week launched a new initiative to give restaurants another possible sales channel in the form of weekly subscriptions.

Territory Foods may sound familiar to Spoon readers. They took over serving Kettlebell Kitchen’s customers after Kettlebell abruptly shut down last year. Territory provides an operations and logistics platform for restaurants and chefs to manage the ordering and delivery of pre-packed, ready-made meals.

Basically, instead of a customer ordering one meal one evening from a restaurant, they could order a number of meals in advance and have them packed up, kept cold and delivered all at once. Restaurants just prepare the meals and hand them off to Territory, which handles all the ordering and distribution.

“Through our platform, folks can order meals direct to their home,” Stefan Niemczyk, Head of Culinary for Territory Foods told me by phone this week.

This type of subscription approach offers restaurants a few benefits, according to Niemczyk. First, obviously, it’s another sales channel for restaurants in these troubled times where every dollar counts. Plus, that revenue is frontloaded and gives restaurants an accurate sense of how much food they need to prepare. Second, Territory can expand the geographic footprint of a restaurant, so a restaurant in LA can serve people in San Diego.

Additionally, Territory has a full culinary team on staff. They can help restaurants put together menus based on data from existing customers, cater to specific diets, and also figure out how to design and prepare each meal for optimal travel.

Right now, Territory is available in the Bay Area and all of Southern California, as well as Washington DC, Baltimore, Virginia, parts of New York City including Manhattan, parts of New Jersey, and Dallas and Houston, TX. Niemczyk wouldn’t get specific about pricing, saying only that it’s a revenue share on a per meal basis that changes depending on the meal concept.

While this pandemic is pushing restaurant owners into new avenues of revenue, the biggest barrier to trying something like Territory might be the restaurant business itself. Faced with a revamping of their businesses, can restaurants stay alive long enough to even try something like Territory?

At least Territory seems to be giving restaurants one more way to get a fighting chance.