Sweden’s Karma has secured $12 million in a Series A funding round as it aims to lead efforts to reduce food waste across Europe.
Swedish investment firm Kinnevik led the round, with other investors including Bessemer Venture Partners and Electrolux.
Karma is a marketplace that enables restaurants and grocery stores to reduce food waste by selling unsold food at a discount direct to consumers, who pick up the food on location.
Founded in 2016 by Hjalmar Ståhlberg Nordegren, Ludvig Berling, Mattis Larsson and Elsa Bernadotte, the firm has expanded to help over 1,500 restaurants, grocery stores, hotels, cafes and bakeries reduce food waste by selling their surplus to 350,000 Karma users.
Sellers are able to generate revenue from food that would otherwise go to waste, reach new customers and reduce their environmental impact, while users get food at half-price or lower.
Since launching in London in February, the business has expanded to over 400 restaurants in the UK, including brands such as Aubaine, Polpo, Caravan, K10, Taylor St Barista’s, Ned’s Noodle Bar and Detox Kitchen.
Karma will use the funding to continue to develop its product range, especially within supermarkets, and to target new markets, starting with Europe. The company plans to expand from 35 people based in Stockholm today to over 100 across five markets by the end of next year and over 150 by mid-2020.
Hjalmar Ståhlberg Nordegren, Karma CEO, said: “We are delighted to announce this investment which will accelerate our mission to reduce food waste globally. We have known the team at Kinnevik for a long time, and they have the long-term perspective and operational expertise that we were looking for in partners.
“We are also delighted to be working with two new top-tier partners in Bessemer and Electrolux who bring unparalleled expertise in their respective fields.”
Andreas Bernström, investment director at Kinnevik, said: “We are thrilled to partner with Hjalmar, Elsa, Ludvig, Mattis and the rest of the Karma team. We are huge believers in their mission and have been truly impressed by what they have achieved so far. We are looking forward to supporting them as they scale-up in the next stage of their journey.”
Kent Bennett, partner at Bessemer Venture Partners, said: “Karma turns would-be wasted product into bargains for customers and profit for merchants – this makes way too much sense not to exist in this world. Beyond the product today, we think owning the communication links between customers and their favourite local merchants could have enormous long-term value.”
Marty Carroll of Electrolux added: “As a world leader in appliances, Electrolux is working closely with Karma to help alleviate the global problem of food waste. We’re impressed with Karma’s innovative digital business model particularly as everyone wins: both the food seller and buyer but importantly also the environment. We are delighted to be supporting Karma as we explore solutions for more sustainable living.”
© FoodBev Media Ltd 2019