Imperfect Foods secures $95m investment commitment

Imperfect Foods has received a commitment to fund $95 million in a growth investment, as it seeks to continue expanding its direct-to-consumer grocery service.  

The Series D financing will be led by Insight Partners – who also led the company’s $72 million Series C round last year – and Norwest Venture Partners.

Founded in 2015, Imperfect Foods aims to reduce food waste by ‘rescuing’ imperfect or excess products, including vegetables, dairy, shelf-stable goods, meat and seafood. These are then distributed to consumers via its grocery delivery service.

“This planned funding underscores the solid infrastructure, supply and customer experience upon which we’ve built this company,” said Imperfect Foods CEO, Philip Behn.

“2020 proved there is a real and growing demand for the marriage of sustainability and convenience in retail food. As the leading direct-to-consumer online grocer with a coast-to-coast footprint and our own last-mile delivery fleet, we plan to continue improving the customer experience by doubling down on technology and building the ‘perfect imperfect assortment’ for our customers.”

The Covid-19 pandemic has seen Imperfect Foods continue to prevent food waste by partnering with airlines to buy up first-class cheese plates and by packaging the popcorn kernels from underused cinemas.

In 2020, the company says that it saw ‘triple-digit’ growth over the previous year and added hundreds of items to its catalogue.

According to Imperfect Foods, the new investment will be used to double capacity and product assortment in existing facilities, improve the shopping experience and accelerate its private label programme, among other things.

“Imperfect is delivering a ‘mission with a margin’,” said Adam Berger, Insight Partners’ managing director and Imperfect Foods’ lead director.

“Their unit economics are exceptional, driven by their unique ‘farm to fork logistics’ that curates customised produce and groceries, with scheduled weekly deliveries to the customer’s doorstep. Imperfect Foods’ supply chain is unmatched and quickly gets fresh groceries from producers to consumers with minimum intermediaries and waste, completing the last mile in their own vans.”