Online office catering platform City Pantry have raised £1.1m of funding from the part tax payer funded Angel CoFund and the London Co Investment Fund.
The company puts corporate caterers in touch with office managers or event organisers offering either one-off catering or a “meal plan” subscription service to provide regular food delivery.
City Pantry, founded by Stuart Sunderland, with Chris Hadfield as Chief Operating Officer, say they will use the funds to consolidate a strong position in London and expand into new cities elsewhere in the UK and Europe.
Its founder believes the European catering market is worth £48 Billion, and told Tech City News: “Our mission is to help the world’s best companies work better by eating together. We believe that good food makes a great company. Sharing a meal creates an environment where better communication, productivity and health are nourished”.
“The Food Delivery market is an exciting space that has already spawned a number of high growth businesses in London”, says Investment Director of the Angel CoFund Tim Mills.
“What is really compelling about City Pantry is the B2B nature of its model which gives corporate customers access to exciting and differentiated menus for the first time and affords the team a more stable order cycle”.
City Pantry were initially backed by TrueStart, the accelerator founded by True Capital Partners. Truestart is described as an “innovation hub” and runs 2 “Collections” per year. Each lasts 4 months and provide a “structured programme for companies that are in the early stages of our development.
The founder of TrueStart and True Capital is Matt Truman, who was previously Global Head of Retail for Lehman Brothers and Head of European Retail at J P Morgan. True Capital’s private equity arm has $100m within its fund and TrueStart (the seed-round investment fund) has $5m available to spend on disruptive retail and consumer businesses, according to Truman, allowing the team to “take an entrepreneur all the way from seed to being a multi-million pound company, knowing the funding is there if they are successful”, as Truman recently told Tech Crunch, adding;
“we’re trying to take the young innovators, the future leaders, and connect them with the big retailers and consumer products businesses, we’re trying to get everyone in the room, trying to knock down the same doors.”
Companies joining “The Collection”, which runs twice a year can expect to win between of £0-50k of investment; the “Seed Collection” runs year round for later stage businesses looking for funding, Truestart’s website says.
TrueStart has strategic relationships in place with companies like Accenture, John Lewis, VISA and River Island, and service partnerships with Google, Microsoft BizSpark, Rackspace and AWS; the company also hosted R:evolution, a Retail and Consumer conference for entrepreneurs and business leaders in the space, with 25 speakers and more than 300 attendees.
As well as City Pantry, TrueStart are backing more than 20 startups, including next generation people counting start-up Hoxton Analytics, and “personalistaion as a service” data analytics firm Pasabi . According to their website, the accelerator will usually take a 4.5% equity stake in exchange for £25k, or a 9% stake for £50k.
The London Co-Investment Fund is founded and managed by Funding London and Capital Enterprise, and has raised £25m from the Mayor of London’s Growing Places Fund for co-investment into seed rounds between £250k to £1m led by selected investment partners; partners include Forward Partners, Crowdcube, Downing and Seedcamp. The fund has invested in Lexoo, Gecko Labs and DoJo, amongst more than 50 others.
London’s delivery startups, from JustEat to Deliveroo, Pronto, Hungry House and others have experienced notable success over the past few years. JustEat is one of the UK’s largest tech unicorns, and Deliveroo, founded by William Shu and Greg Orlowski, have today announced a $275m Series E-round of fundraising, led by Bridgepoint.
Which goes to show what a tough, competitive market the food-on-demand sector is but also how high the level of demand for good quality delivery food is.