Hungryroot Snags $40M Series C Funding
Hungryroot, which bills itself as the first and only AI-powered personalized grocery service, has raised $40 million in a Series C funding round, led by the growth fund of L Catterton, the largest global consumer-focused private equity firm. Hungryroot intends to use the capital to further ramp up growth by considerably increasing the number of groceries and recipes it offers, adding to its team, investing in automation technology, optimizing its proprietary personalization algorithm and scaling its marketing.
“Hungryroot is pioneering an entirely new way to grocery shop,” said Ben McKean, founder and CEO of the New York-based company. “We leverage proprietary technology to predict and deliver the groceries and recipes that best suit each individual customer’s needs and goals. The result is a customer-first, curated experience that reduces the average time consumers spend grocery shopping from two to three hours a week to just two to three minutes. The days of walking into a giant grocery store with an empty cart and browsing through tens of thousands of items will soon be a routine of the past. Hungryroot does the work for customers so they don’t have to.”
The company uses machine learning and predictive-modeling technologies to build customers’ carts for them with fresh groceries and easy recipes that best meet their needs and objectives. Hungryroot also helps customers with meal planning, nutritional support and at-home delivery.
“No two deliveries are the same,” added McKean. “Every delivery is curated for that individual customer and their family. And while customers have the option to edit their order or change their preferences at any time, we’re finding that our predictive technology is so accurate, customers trust us to select the majority of their weekly groceries for them. The end result is that customers save time and headspace, and achieve their food goals, including losing weight, saving money or trying new foods.”
“For most people, grocery shopping is a time-consuming, tedious experience,” noted Chris Roberts, a partner at Greenwich. Conn.-based L Catterton Growth Fund. “Hungryroot has created a technology platform made for modern lifestyles that delivers a personalized, AI-powered consumer experience that traditional grocers simply cannot. We believe Hungryroot is the first online grocer of its kind and have been impressed with its incredibly capital-efficient e-commerce model, which has already reached profitability. We’re thrilled to partner with and support Hungryroot as they continue to reinvent the grocery category and build upon the company’s strong momentum.”
Launched in 2015 as a better-for-you food brand, Hungryroot has been profitable since the beginning of 2020 and is on track to achieve $175 million of revenue this year. The company is forecasting more than $300 million of revenue in 2022. Having raised just $35 million prior to this financing, Hungryroot is known as one of the most capital-efficient businesses in the grocery industry, on account of its best-in-class technology platform and industry-leading customer retention. Along with offering a selection of well-known brands for delivery, Hungryroot develops its own in-house line of innovative healthy products, including its Black Bean Brownie Batter.
