Has there ever been a better time to be a startup focused on providing high-quality food to the hungry masses at an affordable price point?
Following in the footsteps of big Series A financings for Sprig and Spoonrocket, today Munchery is announcing that it’s raised $28 million in a Series B round led by Shervin Pishevar and Scott Stanford’s Sherpa Ventures. The company will use that money to begin expansion beyond San Francisco, beginning with its plans to soon open up shop in Seattle.
Along with the Sherpa, the round includes investment from Jon Favreau, who’s soon releasing a film on the food industry called Chef, as well as Los Angeles-based street food pioneer Roy Choi. Previous investors e.ventures and Menlo Ventures also joined in the financing.
Munchery works a little bit differently than other food delivery services, in that it allows local chefs to create dishes which are delivered cold and then re-heated by customers at their homes. Chefs prepare dishes in a Munchery-run kitchen, which are available for order online or through mobile apps.
The large number of chefs leads to a decent number of options on any given day. Munchery typically has 15-20 entrees, ranging in price from $8-$12 available per day, along with an equal number of sides. It also offers up kid-friendly options, as well as desserts and a wide selection of beverages to choose from.
Consumers in San Francisco typically order two entrees and one dessert or side per order, and come back three to four times a month. As a result, Munchery is delivering up to 5,000 orders each day, and is seeing month-over-month growth of about 20 percent since launch.
On the supply side of things, Munchery provides a way for chefs to make a living doing what they do best — preparing meals. But by cutting out the middle man, they can earn more than they would in a restaurant kitchen, all while providing them with more flexible working hours. The company has about 24 chefs in San Francisco today, with about a dozen of those in its kitchen on any given day.
The new round of funding brings financing to date to just over $32 million. And it comes ahead of big expansion plans for Munchery, which will be using the money in part to help build a state-of-the-art kitchen in Seattle as its home base there. Construction on that facility is already underway, and Munchery expects to be offering food deliveries in that city beginning sometime later this summer.
Leading the initiative in the Emerald City will be Chef Emily Moore, who is joining as Culinary Manager for the region. Moore had previously served as the Executive Chef of The Painted Table in the ’90s, and was named one of the Best Chefs in America in 2013.
But Seattle is just one step in its path to expanding more widely.
That’s something that Pishevar, who’s joining the board, knows a few things about. After all, while he was at Menlo Ventures he invested in Uber just as the company was pushing into new international markets. In a phone interview, he compared Sherpa’s bet on Munchery to where things were at Uber when Menlo invested.
“In San Francisco, [Munchery is] the largest restaurant in the world with just one kitchen,” he said. “If you launch this in other cities, the numbers can get really big really fast.”