Food Supply Chain Company Shelf Engine Closes $41 Million

By Noah Long ● Apr 2, 2021
  • Shelf Engine announced it has raised $41 million in Series B funding to expand its automation solutions to grocers. These are the details.

Shelf Engine announced it has raised $41 million in Series B funding to expand its automation solutions to grocers facing customer, labor, and competitive pressures. Currently live in over 2,000 grocery stores nationwide, Shelf Engine’s intelligent forecasting and order automation system uses advanced statistical models, machine learning, and neural networks to generate the most accurate orders for grocers, drastically increasing sales and margins while reducing the 43 billion pounds of food the industry wastes every year.

This round of funding – which brings Shelf Engine’s total funding to date to $58 million – was led by General Catalyst with follow-on investments by Series A lead GGV Capital along with Foundation Capital, 1984 Ventures, Correlation Ventures, Founders’ Co-op, Soma Capital, Firebolt Ventures, and Initialized Capital. And in addition to continued expansion, the round will enable Shelf Engine to further invest in its rapidly growing team of engineers, data scientists, and supply chain automation experts.

Before the pandemic, average grocery profits hovered around 2%, largely due to store and supply chain inefficiencies. And shifting product demand and rollercoaster sales further compounded these issues with stores now throwing away about one-third of their fresh inventory. This over-ordering costs profitability and also forces retailers to increase prices to make up for these losses.

Traditionally, buyers at major retailers are using unreliable Computer Assisted Ordering (CAO) and SaaS solutions that require significant upfront hardware and software investments to manage their inventory. And these solutions often fail to account for on-hand inventory data and high volatility in sales patterns such as with pandemic or weather-related buying, leading to wasted time and inaccurate orders.

Conversely, grocers who utilize Shelf Engine’s order automation solutions benefit from an average profit margin increase of more than 50% while reducing food waste by as much as 32%. And by analyzing historical orders and sales data – alongside real-world considerations like holidays, school schedules, local events, and weather – Shelf Engine creates the optimal order for every single product every day, automates the order submission process and minimizes stockouts by 90% – which increases sales and margins. Providing more value, Shelf Engine actually guarantees the sale of every item it manages and orders for the grocer, buying back all unsold products and virtually eliminating the grocer’s inventory risk.


“Grocery retailers today need to innovate quickly or they’ll put their companies at risk. We’re reducing waste, while simultaneously increasing sales, and that goes straight to the grocer’s bottom line. We’re helping grocers to make much more money, better positioning them to gain market share and offer competitive prices, especially important as tech giants and other disruptors are entering the market. This latest round will enable us to further meet the demand from our customers to launch into thousands of new stores in the next 18 months.”

— Stefan Kalb, co-founder and CEO, Shelf Engine

“Shelf Engine’s business model hits the trifecta of simultaneously benefitting retailers, consumers, and the environment. That degree of stakeholder alignment is a rare accomplishment. That the company has been able to help transform ordering and inventory management for thousands of grocers in just a few short years is a testament to CEO Stefan Kalb’s instincts and the strong, data-driven team he’s built.”

— Kyle Doherty, managing director, General Catalyst

“The grocery industry is on the precipice of monumental change, with few companies driving the same level of innovation as Shelf Engine. GGV looks to support companies with the potential to create significant impact on the efficiency and evolution of existing industries. Shelf Engine has the ability to overhaul the entire supply chain, providing direct, tangible benefits for both the grocery industry and the environment.”

— Hans Tung, managing partner, GGV Capital and Shelf Engine board member