FreshToHome, a Bangalore-based e-commerce startup that sells fresh vegetables, fish, chicken and other types of meat, has raised $ 20 million in new round of funding as it seeks to expand its presence in the country.
The Series B cycle for the startup was led by Iron Pillar, with input from Joe Hirao, the founder of Japanese company ZIGExn. The startup, which closed its $ 11 million Series A funding round three months ago, has raised $ 33 million to date.
FreshToHome sells “100%” pure and fresh vegetables and meat in Bangalore, Mumbai and Pune – the latter two having recently entered. He says it doesn’t add any preservatives or other chemicals to extend the shelf life of the product. (Typical meat sold by a retail store is riddled with chemicals and could be months old.)
Unlike most other markets, FreshToHome has built its own supply chain network, which allows it to better control the quality and delivery of food products. She uses trains and planes to move her inventory and has become one of the biggest customers of several local airlines.
The startup sources its vegetables and fish directly from 1,500 fishermen and farmers across the country. He uses an app to negotiate with farmers and fishermen.
It continues to expand its control over all aspects of its activities. “Today, a large part of our poultry comes from institutional breeders. Now we take it a step further and process the chicken ourselves at the slaughter level, ”Shan Kadavil, CEO of FreshToHome, told TechCrunch in an interview.
FreshToHome is able to deliver perishables the same day and within two hours, Kadavil said.
The startup also recently started operations in the United Arab Emirates and has opened physical stores in Bangalore and Chennai.
FreshToHome has accumulated 650,000 customers – up from 400,000 at the end of May – in 10 cities in India, and recently started selling milk in Bangalore, another market segment that remains largely unstructured in the country. It receives 14,000 orders every day and processes 20 tonnes of fresh produce.
It recently broke the $ 30 million mark in annualized direct-to-consumer sales, making it the largest ecommerce platform serving this category. It is seeing 30% month-over-month growth, said Kadavil, who previously handled technical support for support, and operations in India for games company Zynga.
And this growth has helped the startup gain attention. Several major players in the country, including Amazon India, which recently expanded to include the perishable category and Flipkart, have held talks with FreshToHome to acquire a stake in the startup, a person familiar with the matter told TechCrunch.
And there is a great opportunity in space. The Indian cold chain market is estimated to reach $ 37 billion in the next five years.
In addition to sourcing directly from farmers and fishermen, FreshToHome also serves as a micro-VC, giving them access to upfront cash and resources to produce more from their farms. It also gives them the assurance that it will buy back their products.
Kadavil founded FreshToHome with Mathew Joseph, an industry veteran who has been exporting fish for over 30 years. Joseph launched India’s first fish and meat e-commerce company called SeaToHome in 2012.
FreshToHome will use the fresh capital to expand its network of contract farmers and add 200 to 300 tonnes of additional produce each month.
In a prepared statement, Anand Prasanna, Managing Partner of Iron Pillar, for which this is the first investment in the food technology space, said: to be made in India on a large scale. By intelligently using big data and machine learning, they have created a sustainable supply chain, which offers a fair price to consumers, fishermen and farmers, for their high-end products… We love companies that solve problems also difficult in large market segments in India thanks to technology enabled moats! “