Apeel Secures $250M Funding to Revolutionize Fresh Food Supply Chains

Apeel Sciences Secures $250 Million to Combat Global Food Waste

Apeel Sciences, an innovator in food system technology, is dedicated to minimizing food waste on a global scale, particularly as disruptions caused by the recent pandemic continue to impact food supply chains.

The company has recently completed a Series E funding round, raising $250 million and achieving a valuation of $2 billion. These funds will be utilized to expand the availability of its produce preservation technology across the United States, the United Kingdom, and Europe, regions where substantial food waste occurs – approximately 40% in the U.S. alone.

Investment Details and Backers

Temasek, a pre-existing investor, spearheaded the funding round. Joining them were both new and returning investors, a diverse group including Mirae Asset Global Investments, GIC, Viking Global Investors, Disruptive, Andreessen Horowitz, Tenere Capital, Sweetwater Private Equity, Tao Capital Partners, K3 Ventures, David Barber of Almanac Insights, Michael Ovitz of Creative Artists Agency, Anne Wojcicki of 23andMe, Susan Wojcicki of YouTube, and Katy Perry.

This latest investment brings Apeel’s total funding to over $635 million since its inception in 2012. Prior to this, the company secured $250 million in Series D funding in May 2020.

The Science Behind Apeel’s Technology

Based in Santa Barbara, Apeel has pioneered a plant-derived coating for fruits and vegetables. This coating is both tasteless and odorless, functioning to retain moisture while simultaneously allowing oxygen to escape. According to Apeel CEO James Rogers, this dual action effectively doubles the shelf life of grocery produce.

Apeel’s application process is integrated directly into supplier facilities during the produce packing stage. Furthermore, the company recently acquired ImpactVision to enhance quality control. This acquisition incorporates imaging systems into the supply chain, optimizing routing to ensure a greater proportion of harvested produce is ultimately consumed.

Addressing a Global Challenge

“Considering that one in nine people globally face hunger, and a significant portion – three in nine – of produce is discarded, we have a responsibility to better manage our food resources,” Rogers stated. “This is a resolvable issue, contingent upon efficiently directing resources to the appropriate locations at the optimal times.”

Apeel is not the sole entity addressing food waste; companies like Shelf Engine, Imperfect Foods, Mori, and Phood Solutions are also actively working to improve the food supply chain and have attracted venture capital to support their efforts.

Shifting Consumer Behavior and Grocery Retail

Rogers explained that pre-pandemic trends of increasing food consumption have reversed. Consumers are now more mindful of their food choices, shopping less frequently, and purchasing larger quantities per visit, often online. Grocery stores are adapting to these evolving consumer habits.

“Our approach involves collaboration with both suppliers and retailers,” he emphasized. “While grocery stores focus on adapting to changing shopper preferences, we concentrate on enhancing the supply chain. What began as a solution for extending the lifespan of fruits and vegetables is evolving into a system for providing data-driven insights to empower the entire chain and minimize waste.”

Impact and Expansion

Since 2019, Apeel has prevented 42 million pieces of fruit from being wasted in retail settings, including a reduction of up to 50% in avocado waste, alongside corresponding sales increases. This preservation effort has also conserved nearly 4.7 billion liters of water, as reported by Rogers.

Over the past year, Apeel has established a presence in eight countries, operating 30 supply networks and distributing produce to 40 retail partners, reaching tens of thousands of stores worldwide.

The new funding will accelerate the deployment of these systems and facilitate the creation of an additional 10 supply networks through partnerships with retail and supply chain stakeholders by year-end. Rogers also anticipates utilizing the funds to further develop Apeel’s data analytics capabilities and explore potential future acquisitions.

Investor Perspective

Thomas Park, president and head of alternative investments at Mirae Asset Global Investments, highlighted his firm’s long-standing commitment to environmental, social, and governance (ESG) investments, focusing on companies that deliver substantial global impact in a readily understandable manner.

Mirae Asset Financial Group frequently collaborates with other investors on venture rounds, as demonstrated by their partnership with Temasek in Apeel’s funding. They also jointly invested with Temasek in Impossible Foods, leading its Series F round last year.

“Temasek’s increased investment signaled confidence in Apeel and presented us with an opportunity to participate,” Park stated. “Food waste is a pervasive global issue, and after engaging with James, we are convinced that Apeel represents the next generation of solutions for tackling these significant challenges effectively.”