Summary List Placement
Add Misfits Market to the list of grocery startups that continue to raise cash despite the pandemic ebbing in the US.
The New Jersey-based grocery-delivery service said it raised $200 million in Series C funding Wednesday, taking it into unicorn territory, which would be a valuation of more than $1 billion. The venture-capital fund Accel and hedge fund D1 Capital co-led the round, which raised Misfit’s total funding to date to $301.5 million.
Expanding Misfits’ operations to serve all of the 48 contiguous states is CEO and founder Abhi Ramesh’s main goal in the near-term. That includes investing a chunk of the latest funding in opening new warehouses and improving Misfits’ fulfillment technology, which the company develops in-house and doesn’t purchase from third parties.
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Building that technology is a more expensive route than outsourcing, Ramesh said. But he added that it also gives the company a leg up over rivals, especially given the challenges of filling grocery orders: Ramesh said that Misfits’ technology helps it decide how big a box to use for an order based on its contents, destination, and other variables.
“Our approach was kind of like the Amazon approach in the early days,” Ramesh told Insider. “I believe very strongly that owning a lot of that fulfillment infrastructure will be a true moat in the long-term.”
That’s an advantage that could one day generate revenue for Misfits if it decides to license its technology to other companies, though Ramesh said it doesn’t have plans to do so right now. “At the end of the day, that infrastructure, it’s powering Misfits Market,” he said. “There’s no reason why we couldn’t license it to power some other brand.”
Grocery-delivery startups have continued raising money in 2021, even as more US consumers get vaccinated and society opens back up. Players like Imperfect Foods and Good Eggs have also closed new funding rounds this year. And many, including Hungryroot, are tweaking their offerings and technology to keep customers ordering even as shopping at stores, a relatively riskier choice at the …read more
Source:: Business Insider