Arlington meal delivery service Territory Foods has raised $22 million in fresh funding, the startup announced Tuesday.
The round, led by U.S. Venture Partners, also included Upfront Ventures, Lewis & Clark Ventures, DF Enterprises, S2G Ventures, Gaingels, Middleland Capital and Rethink Food Capital. The new round brings the company’s total funding since its founding in 2011 to $44 million.
The company creates specialty meals that cater to a wide variety of specific diets, including paleo, Whole30, keto, vegan, low carb and low fat, among others. Customers can order the meals delivered in bulk once or twice a week. On the other end, a network of chefs and business partners that include Founding Farmers prepares and packages the food. Territory Foods said the network is 42% women-owned and 38% Black, Indigenous, people of color or Latino-led.
“This new round of funding will allow us to expand our chef community and provide our customers with even more options,” Ellis McCue, CEO of Territory Foods, said in a statement. “We go to great lengths to create optimized, personalized meals for each consumer and empower our chefs with data about our customer’s taste and nutritional preferences so they can tailor each meal, ultimately providing more variety than other delivery options out there.”
McCue, previously the chief operating officer at Territory Foods, took over from former Amazon exec Abigail Coleman in April 2020, just as the Covid-19 pandemic had shuttered businesses across America. The company has about 73 employees, according to data from LinkedIn, a 35% jump since April of 2020.
In September, the company announced it had expanded into Austin, Texas.
But the company was forced to rework its logistics amid the spread of the pandemic. Originally, the startup placed Territory Foods pickup spots in gyms and fitness centers as well as home delivery. Those places closed en-masse, and Territory Foods switched entirely to delivery — a bet that has paid off, according to one source familiar with the company's operations.
That has meant growth of about 200% year over year, the source said, who did not offer specific revenue but said the company could, if things go well, hit $100 million in revenue in 2022.
The shift to home delivery might be a little ironic, as a spate of such startups grew and failed years ago. Meal delivery startup Maple, which served New York City and shut down in 2017, saw costs from food waste clock in at 26% of its overall revenue. Meal delivery company Sprig, which raised $57 million in funding, shut down in 2017, citing the cost of meal production and delivery at larger scales.
Meanwhile, San Francisco microwavable meal delivery company Munchery, which had raised about $120.7 million in venture funding between 2013 and 2015, declared bankruptcy and ceased operations in 2019.
