Shelflife Raises $3 Million Seed Round - Raw Materials Marketplace

A New Marketplace Aims to Modernize Raw Material Sourcing for Food and Beverage Brands

Two years prior, Lillian Cartwright collaborated with colleagues from Harvard Business School to establish Astrid, a novel spiked seltzer brand. Despite the proliferation of tools designed to simplify the launch of Direct-to-Consumer (D2C) businesses, the team encountered difficulties in securing essential raw materials.

The Supply Chain's Lagging Infrastructure

According to Cartwright, this segment of the supply chain remains antiquated, heavily reliant on traditional trade shows, referrals, established personal networks, and extensive telephone communication.

This realization spurred the creation of ShelfLife, a company co-founded by Cartwright and John Cline. Their objective is to develop a comprehensive directory and marketplace connecting brands with raw material suppliers based on their precise requirements, facilitating rapid quote acquisition.

A Shift in the Industry Landscape

The existing system predominantly favors established, large Consumer Packaged Goods (CPG) companies. However, the industry is undergoing a transformation. Notably, craft beverages are experiencing increased popularity, and the pandemic accelerated consumer adoption of online purchases of bottled, boxed, and canned goods.

Cartwright highlights that approximately 50 new food and beverage brands emerge daily. However, these smaller, nascent brands lack streamlined access to material procurement. In Cartwright’s own experience with Astrid, the complexities proved insurmountable, leading to the project’s abandonment.

“I channeled that experience into a new venture,” Cartwright stated. “Numerous individuals aspire to launch brands within the food and beverage sector, yet resources pertaining to supply chain management are scarce. A significant opportunity exists, and the digitization of this entire space is imminent.”

ShelfLife's Current Operations and Future Plans

Currently in its beta phase, ShelfLife levies a modest usage fee for its software. The company also manually obtains supplier quotes on behalf of brands. The recently secured funding will be allocated, in part, to automating this process to enable scalability for both brands and suppliers.

A challenge lies in the reluctance of some suppliers to be directly compared against competitors on a single platform. Cartwright contends that the evolving industry dynamics necessitate increased lead generation from emerging brands, a trend suppliers should proactively embrace.

The long-term vision for ShelfLife involves transitioning to a commission-based revenue model, derived from the budgets suppliers typically allocate to field sales representatives. Furthermore, the company intends to develop financial products to assist brands, as many suppliers require upfront payments, which can strain the resources of smaller businesses.

Investment Details

The seed funding round was jointly led by Switch Ventures and Kindred Ventures, with additional participation from NextView Ventures, Ben Zises (SuperAngel.vc), Ilia Papas (Blue Apron’s former CTO), and Elena Donio (former president of SAP Concur).

Key takeaway: ShelfLife aims to revolutionize the raw materials procurement process for emerging food and beverage brands.