Meat processor Smithfield Foods has joined Campbell’s in investing in US meal kit upstart Chef’d.
The pork processor has put $25 million into Chef’d, according to a filing with the US’ Securities and Exchange Commission that was confirmed with both Chef’d and Smithfield Foods. Added to the $10 million that Campbell’s invested and a $200,000 investment from online grocery company Fresh Direct, it brings the total amount raised by Chef’d as part of its latest funding round to $35.2 million.
Smithfield Foods president and chief executive officer Kenneth M Sullivan said: “This strategic partnership reflects our continued commitment to innovation – both in our products and how they are delivered to consumers. We’re able to expand our e-commerce capabilities and reach consumers looking for high-quality, stress-free meals.”
And Chef’d CEO Kyle Ransford said: “Leveraging the collective knowledge and capabilities of both companies, our partnership will open up opportunities for innovation and access to first-in-class national manufacturing and distribution facilities as we rapidly scale. Smithfield is a well-recognised leader in the food industry and shares our vision of meal kits and e-commerce playing an increasingly important role in consumers’ food choices.”
Chef’d brings together various different offerings from the likes of Atkins and Weightwatchers, and has also developed its own range of meal kits covering different meal occasions and cuisines.
It is one of a number of companies to receive big-name backing in recent months: Unilever was the lead investor in US meal delivery company Sun Basket back in May, which was followed by Nestlé’s acquisition of a minority stake in Freshly in June.
In addition, Amazon has soft-launched its own meal kit delivery service after becoming heavily involved in the food delivery and food retail categories in recent months – not least with the $13.7 billion mega-deal for Whole Foods – while Coca-Cola teamed up with Chef’d last month to develop a series of food pairings for several of its beverage products.
“E-commerce and direct-to-consumer is an evolving space,” Chef’d CEO Kyle Ransford told American broadcaster CNBC. “The strategics are ahead of the financial players in terms of understanding where the market is and what it’s doing.”
Following Campbell’s $10 million investment in May, the company was widely reported as being Chef’d’s largest strategic investor. But it has now been eclipsed by Smithfield Foods – the world’s largest pork processor and the owner of brands like Smithfield and Eckrich – whose identity was confirmed to CNBC by Ransford.
At the time of Campbell’s investment, Ransford said: “We are actively looking to add strategic partners and Campbell’s outlook on the future of food and e-commerce aligns perfectly with the Chef’d vision of the future of online grocery. Both Campbell and Chef’d believe in continuing to drive innovation in the new food economy, particularly around consumer customisation and e-commerce solutions.”
The move plays into Campbell’s focus on digital marketing and food transparency, with CEO Denise Morrison predicting that “e-commerce will transform the food industry in similar ways to how it transformed entertainment and apparel”. She called the pace of the meal delivery sector ‘a game changer’ for consumers, manufacturers and retailers.
Morrison continued: “In the last six years, we’ve made significant progress activating our purpose – ‘real food that matters for life’s moments’ – and transforming our portfolio toward faster-growing spaces. Our intention has been to move Campbell in the direction of health and wellbeing. We are committed to accelerating those efforts and strive to be the leading health and wellbeing food company because we recognise that real food and healthier food is better for our consumers and better for our business.”
And Mark Alexander, president of Campbell’s Americas Simple Meals and Beverages division, added: “We’re investing in digital and e-commerce across the enterprise with a goal of building industry-leading capabilities and relationships that will drive innovation in this space.”
© FoodBev Media Ltd 2018