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Food Startups Attract Major Investors

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Food Startups Attract Major Investors

Several different startups in the food industry have been gathering funding from investors over the last week. Here are a few notable ones looking to make an impact on the future of food.

Misfits Market

Subscription box company Misfits Market raised $85 million in Series B funding to expand its “ugly” produce program, reported TechCrunch (July 22). Valor Equity Partners was the primary participant, along with Greenoaks Capital, Third Kind Venture Capital, and Sound Ventures.

The 2-year-old startup began as a subscription box that allowed consumers to buy misshapen produce for cheap every week. It has recently been working to expand its selection, which now includes chocolate, snacks, chips, coffee, herbs, grains, lentils, sauces, and spices. Users can add these products to their usual weekly produce box.

Misfits Market raised a total of $101.5 million. It will continue to build out its team, which has been growing rapidly during the pandemic. The company hired 400 people since March, compared to 150 in the three-month period prior.

The company will also open a new warehouse in New Jersey to double its capacity across the East Coast, the South, and the Midwest.

Chowbus

Delivery service Chowbus attracted $33 million in financing, led by the Silicon Valley-based investment firm Altos Ventures and New York’s Left Lane Capital, reported TechCrunch (July 22). Hyde Park Angels, Fika Ventures, FJ Labs and Silicon Valley Bank also participated in the round.

Founded four years ago in Chicago, Chowbus specializes in delivery for regional cuisines from Northern and Southern China, Japan, Korea, Taiwan, Thailand, and Vietnam.

The company said it would use its new funding to expand to more cities across the U.S. and add new products like a “dine-in” feature allowing diners to order and pay for their meals on their phone for a contactless experience at restaurants in cities that are reopening.

“The market is experiencing a permanent shift from offline to online ordering, a trend that Chowbus is actively driving,” said Harley Miller, managing partner at Left Lane Capital. “Focusing on this large and loyal constituency with a vertical-approach to supporting Asian restaurants and food purveyors allowed Chowbus to differentiate itself on both sides of the marketplace.

Joywell Foods

Joywell Foods attracted $6.9 million in a Series A financing round, led by Evolv Ventures, a venture fund backed by Kraft Heinz. Combined with a previous seed round, this latest raise brings the company’s total funding to $13.2 million.

Khosla Ventures and SOSV—who participated in Joywell Foods Seed round—returned to support the company’s growth, alongside Alumni Ventures Group and other investors.

Joywell is developing sweet proteins and will use the funding to build out its proprietary technology platform, broaden its product portfolio, and expand research and development operations. The company also plans to test consumer offerings through direct-to-consumer and limited retail initiatives.

“Our team is excited to bring sweet proteins to commercial scale with the support of our newest investor, Evolv Ventures. These funds bring us one step closer to our vision of eliminating the prevalence of sugar in our diet,” said Karen Huh, CEO of Joywell Foods.

Shelf Engine

Seatlle-based tech startup Shelf Engine gained $12 million in funding from Garry Tan’s Initialized and GGV, reported TechCrunch (July 21). Other investors in the company include Foundation Capital, Bain Capital, 1984, and Correlation Ventures.

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Shelf Engine optimizes grocery store stocking in an effort to reduce food waste. It completed successful tests in approximately 400 stores in the U.S.

The money from the round will be used to scale up the engineering team and its sales and acquisition process. The company intends to get insights into secondary sources like imperfect produce resellers or other grocery stores that work as an outlet.

Cooks Venture

Blue Apron COO and cofounder Matt Wadiak raised $10 million for Cooks Venture in Series A funding, reported Forbes (July 22).

The company aims to develop a new breed of chicken that would compete with the Cobb and Aviagen breeds, with a focus on humane treatment and better taste.

The $10 million round includes funds from SJF Ventures and impact investor Larry Schwartz, who have long bet on the longevity of ethically driven agriculture.

In June 2017, a month after Blue Apron’s highly anticipated IPO failed to skyrocket, Wadiak stepped down as COO and decided to re-envision poultry as his second act. “I thought I’d put my money where my mouth was. I’d been preaching for a decade about changing agriculture,” he said.

He bought Cooks Venture for an undisclosed amount in 2018 with a plan to bring its new breed to consumers.

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