Food delivery service Misfits Market announced an $85 million Series B funding Wednesday that will help the 2-year-old startup deliver organic, affordable groceries and fight food waste.
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Valor Equity Partners led the round of new funding, with participation from Greenoaks Capital, Third Kind Venture Capital, and Ashton Kutcher and Guy Oseary-founded Sound Ventures. With the Series B, Misfits Markets has raised a total of $101.5 million, which includes a $16.5 million Series A investment from 2019, according to Crunchbase data.
As part of the investment, Jonathan Shulkin, partner at Valor Equity Partners, will join the Misfits Market board of directors.
Misfits Market will use the new funding to scale its operations with the opening of its new, state-of-the-art warehouse in Delanco, New Jersey, Abhi Ramesh, founder and CEO of Misfits Market, told Crunchbase News via email. It will also build out its corporate and operations teams, expand its customer base, and increase product and category offerings across its online grocery platform.
The new warehouse will enable the startup to more than double its order capacity across the East Coast, the South and into the Midwest. It will also expand its delivery area into Arkansas, Mississippi and Louisiana, with upcoming launches in Wisconsin, Minnesota, Iowa and Michigan, the company said. In total, the company currently serves 26 states, Ramesh said.
Following Misfits Market’s Series A last year, Ramesh said, the company experienced an 18 times increase in its subscriber base, as well as a 400 percent increased demand in the last three months as a result of COVID-19. It has also rescued more than 40 million pounds of produce, mostly imperfectly shaped, he added.
Last fall, Misfits Market partnered with brands such as Bob’s Red Mill, Taza Chocolate, Minor Figures Oat Milk, Teatulia and Ceremony Coffee, to start its Marketplace brand, an online affordable grocer, where subscribers can add shelf-stable items and specialty produce onto their box at an average of 25 percent to 50 percent off of retail prices, he added.
Today, Misfits Market has more than 600 full-time employees between its corporate employees and the operations team, hiring approximately 400 new employees since March. With the new expansion opportunities, Ramesh said he hopes to double that number by the end of the year.
Next up, Ramesh said by the end of the summer customers will be able to fully customize their boxes, first by choosing the produce they want, then rounding out their grocery shopping with nearly 200 Marketplace offerings.
“Our mission is to become the future of grocery delivery with a values-driven, value-oriented business model,” Ramesh said. “As inefficiencies in the supply chain persist, especially given global disruptions triggered by the coronavirus pandemic, Misfits Market will transform them into opportunities to provide access to quality food for all.”
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