Making Millions From “Ugly” Fruit?

Read time: 3 minutes

Good morning! It's Friday, June 30th - Today, we’re unpacking a startup that bought “ugly” fruit at a discount and turned it into a $300M+ revenue business.

Let’s unpack Imperfect foods!

THE FEATURE

Imperfect Foods - Making Millions From “Ugly” Fruit?

Ben Simon and Ben Chesler have turned fruits and veggies into a mission-driven gold mine. From a college project to fighting food waste, Imperfect Foods is sprouting into an impressive sustainable business!

What’s Imperfect Foods?

Ben Simon and Ben Chesler are the founders of Imperfect Foods, a company that has reimagined grocery delivery. Founded in 2015, Imperfect Foods aims to reduce food waste by selling “imperfect” or “ugly” produce and pantry staples directly to consumers through an online subscription service.

The Numbers:

2019: Raised $47 million in Series C funding round.

2020: Raised $72 million in Series C funding round. Revenue for 2020 is estimated at $187 million.

2021: Raised $110 million in Series D funding round, with total funding at $229.1 million.

2023: Serving over 400,000 customers. Estimated revenue in 2023 exceeds $350 million.

The Story:

Imperfect Foods started as a college project by Ben Simon in 2011, aiming to reduce food waste at the University of Maryland.

In 2015, Ben Simon and Ben Chesler officially launched Imperfect Foods to address the larger issue of food waste and its environmental impact.

They began by delivering “ugly” produce - fruits and vegetables that are perfectly good but are usually thrown away because they don’t meet cosmetic standards - to customers’ doorsteps.

The business model of Imperfect Foods resonated with consumers who are environmentally conscious and looking to make a positive impact through their purchasing decisions.

Imperfect Foods has been steadily growing, raising millions in funding, and expanding its customer base.

The company now serves over 400,000 customers and continues to be on a mission to eliminate food waste and build a better food system for everyone.

The How:

1. Ugly is the New Fresh: Imperfect Foods made a unique insight that there is a market for “ugly” produce. These are fruits and vegetables that are just as fresh and delicious but may have slight cosmetic imperfections. The company realized that a significant segment of consumers is more concerned with freshness and sustainability than mere appearance.

2. Cost-effective and Sustainable: By sourcing “ugly” produce, Imperfect Foods can buy at lower costs and pass these savings to the customers. This makes their service both cost-effective and sustainable, striking a chord with budget-conscious and eco-friendly consumers.

3. Convenience and Customization: Imperfect Foods’ online subscription model provides consumers with the convenience of getting fresh produce delivered to their doorsteps. Additionally, the customization option allows consumers to choose what goes into their box, ensuring they get what they need and like.

4. Socially Conscious Branding: Imperfect Foods has expertly branded itself as a socially conscious choice. Their mission to reduce food waste and build a better food system has created a brand image that resonates with the growing number of consumers who want to make positive changes through their purchasing decisions.

5. Expanding Offerings: The company didn’t stop at produce; they expanded their product range to include pantry staples, dairy, and meats, all focusing on sustainability and reduction of food waste. This helped them to become more of a one-stop-shop for ethically sourced groceries.

6. Community Engagement: Through a robust social media presence and community-building initiatives, Imperfect Foods has established a strong connection with its customer base. Sharing stories of farmers, providing recipes for their produce, and transparently talking about their mission are some of the ways they engage their community.

By combining these elements, Imperfect Foods has created a powerful “secret sauce” that enabled them to build a big business quickly while.