- Pod Foods — a company that is reinventing the grocery supply chain — announced it has raised $13 million in funding. These are the details.
Pod Foods — a company that is reinventing the grocery supply chain with the first full-service wholesale B2B marketplace with built-in logistics — recently announced that it raised a total of $13 million in funding, including the closing of a $10 million Series A led by Industrious Ventures with participation from Microsoft’s venture fund M12, Moment Ventures, and others. Other investors in the round include Unshackled Ventures, Barrel Ventures, Relish Works, X Factor Ventures, XRC Labs, K2 Global, Graphene Ventures, and others.
The pandemic — along with the rise of DTC (direct to consumer) 10-15 minute grocery and convenience delivery services — created a stronger need for brands and retailers to connect as consumers demand faster access to a wider variety of products and retailers shift towards continuous optimization and faster category resets. And Pod Foods streamlines the procurement process for retailers while enabling data-driven discovery for the emerging brands that consumers want. The current investors from the company’s seed round, which previously saw the company raise $3 million, include Moment Ventures and M12.
The rapid growth of delivery services during the pandemic has contributed to a seismic shift in consumer expectations and retailers are struggling to keep up. And to adapt to increased demand for a constant stream of new and trending products delivered to their doorstep in under an hour, retailers need to embrace data and adopt new technology to find and procure emerging brands faster, regardless of the format.
Plus Pod Foods helps retailers with this brand procurement, solving the problem of fragmentation for the segment of high-growth brands that cannot afford the challenges and expenses of incumbent wholesalers. And at the same time, Pod Foods gives emerging brands a transparent and easy-to-use platform to quickly reach relevant retailers across the country. This provides access to the infrastructure needed to scale affordably and eliminates hundreds of thousands of dollars in hidden fees, chargebacks, and other trade deductions. The unique marketplace connects the 2 sides with a streamlined user interface, handling everything from orders down to fully-consolidated logistics that get the products from warehouse to shelf.
Pod Foods is known as the only asset-lite digital B2B marketplace with full logistics built-in, offering a one-stop distribution service that allows retailers to discover, order, and receive products in a consolidated fashion, onboarding new brands and getting them to the shelf in as little as 24 hours. And the company utilizes proprietary logistics optimization software and a network of warehousing and carrier providers to empower the marketplace. It services not only traditional retail formats with wholesale products but also high-growth, direct-to-consumer delivery services like Gopuff, which was recently valued at $15 billion.
The company’s Series A will be used for expanding the Pod Foods brand and retailer network, helping brands and retailers connect nationwide. And Pod Foods will also be scaling their data team to facilitate better matching and liquidity, as well as to right-size inventory counts. The company also recently hired Timothy Wee as CTO, who formerly led machine learning projects at Google, Amazon, and Walmart Labs.
KEY QUOTES:
“Before we created Pod Foods, we ran a cookie company that grew a huge fan base, and we experienced first-hand how damaged the supply chain was on both the retailer and brand side when trying to enter retail. Traditional distributors are incentivized, by nature of their business model, to focus on the highest-volume, established brands. They squeeze out the emerging, high-growth brands driving industry growth. This leads to a gap in supply at the retail level, as retailers struggle to discover and procure brands outside of established distribution networks. The problem has become even more pronounced with pandemic-related production shortages as well as new consumer expectations in retail. Retailers have to respond even faster to get relevant products to their customers. More continuous, data-driven category optimization will take the place of quarterly or bi-annual product reviews and resets.
— Larissa Russell, Co-founder, and CEO of Pod Foods
“Pod Foods has excelled at supporting emerging brands on a national scale. As Gopuff continues to enhance the retail experience, flexibility, speed, and efficiency are of the utmost value. Pod Foods has been an ideal partner with the ability to onboard products quickly and seamlessly, allowing us to continue to bring in the best assortment to our growing customer base.”
— Michael Berl, Head of Regional Partnerships at Gopuff
“Retailers reacted correctly to the pandemic and prioritized keeping products flowing in the midst of price hikes and shortages. However, we’re now seeing consumers shift spending habits back to locally sourced emerging products – and it is imperative for retailers to adapt quickly. Since last year, we have more than doubled the number of brands on our platform. We’re seeing a 20% increase in repeat brand purchases today compared to pre-pandemic data. Our solution helps them understand what to buy because we’re seeing the trends ahead of anyone else. We match the most relevant brands to the right retailers and provide retailers with fast procurement of those items to help them keep shelves full, without the hassle of dealing directly with each brand. “
— Fiona Lee, Co-founder, of Pod Foods
“As consumers increasingly drive demand, the retail landscape is changing. The old way for retailers and brands to connect no longer works. Pod Foods is the first to provide the logistics infrastructure needed to completely overhaul the grocery supply chain for the better, creating a true end-to-end system that enables both retailers and brands to thrive.”
— Christian Gammill, partner at Industrious Ventures
