INSUBCONTINENT EXCLUSIVE:
Farmdrop, the farmer-friendly online grocery platform based in the U.K., has picked up £10 million in new funding
New investors in this Series B round include LGT Impact Ventures (described as a growth equity investor that invests in businesses making a
positive contribution to society), and Belltown Ventures, a renewable energy investment specialist with an interest in agricultural
Previous backer Atomico also followed on.Founded by ex-city broker Ben Pugh in 2014, Farmdrop originally launched as a ‘click and
collect’ service that let you order groceries online from farmer-producers to pick up at a local collection point
However, the company has since pivoted to door-to-door delivery but with the same basic idea of a marketplace that bypasses the mass
It claims to give consumers much fresher produce, and farmer-producers a more generous share of the retail price
Large supermarkets are known for squeezing suppliers in a bid to lower prices whilst maintaining their own profits, after all.“The
fundamental problem is that the supermarket’s dominance over the last fifty years has put huge amounts of downward pressure on farmgate
prices,” Pugh told me when Farmdrop raised its Series A
“In this environment, the only option for producers has been to focus on yields and durability which has led to a big depreciation in the
taste and nutritional quality of homegrown foods”.To that end, Farmdrop says it now sells over 2,000 products ranging from high-welfare
meat, dairy, fish, organic fruit and veg, plus household supplies and larder items
It says that 80 percent of its fresh produce is sourced directly from 208 “sustainable farmers and independent food makers” and that
since 2014 the startup has generated over £5 million in revenue for small-scale British farmers.The new capital will be used to fund
expansion after the successful launch of a second hub in Bristol and Bath in September 2017, in addition to London
“Over the next six months Farmdrop will double the total number of households it can deliver to, initially growing in the South East but
with plans for a northern hub in Manchester by end of 2019,” says the company.More broadly, Farmdrop is tapping the rise of online grocery
— even if the offline to online switch is still happening quite slowly — coupled with a growing demand for high-quality produce that
comes from a more ethical/sustainable supply chain (Farmdrop also uses electric vans for the last few miles of delivery)
It seems to be working, too: the startup says it is now on track to achieve £10 million in annualised revenues before the end of 2018.Adds
Niklass Zennström, Skype founder and CEO of Atomico: “What we find so compelling about Farmdrop is the way they’re using technology for
By creating a direct route to market for farmers, Farmdrop is helping to create a healthier and more efficient supply chain
We’re proud to invest in such a fantastic team and are excited about helping them scale their innovative e-grocery platform.”
