FreshSpoke, a wholesale local food software platform provider based in Barrie, Ont., has raised a $550,000 seed round.
The seed round was led by members for the Georgian Angel Network, in addition to the Brampton chapter of CBA Catalyst, and US-based venture capital firm SOSV. FreshSpoke will use the investment to grow its team, expand its distribution capacity to respond to increased customer demand, and evolve its shared commercial delivery system.
FreshSpoke plans to scale to other regions in Canada and the US early next year.
“Freshspoke’s continues to show itself as a leader in wholesale local food distribution,” said Shawn Broderick, general partner at SOSV. “We’re excited to provide this fresh capital to support its sales growth and the ongoing evolution of this next-generation food-tech platform.”
FreshSpoke aims to make local food more accessible to businesses, by allowing wholesale buyers to source product directly from local food suppliers, and delivering it using the excess capacity that already exists in commercial delivery. FreshSpoke said it’s seeking to take on the distribution challenge that often keeps farmers out of the wholesale supply chain.
The company was founded in 2016 by CEO Marcia Woods and CTO Henry Quach. The platform currently works with over 200 suppliers and 500 wholesale buyers that include Sobeys, Whole Foods, Organic Garage as well as independent retailers and foodservice businesses in Ontario and Ohio. FreshSpoke plans to scale to other select regions in Canada and the United States, beginning in early 2020.
“Instead of putting more trucks on the road, we’re tapping into the what already exists and goes largely unused,” said Woods. “This reduces food miles, drives down costs and gives commercial drivers the ability to earn extra income delivering local food.”
FreshSpoke said it surpassed its original funding goal and will focus its efforts on sales growth in preparation for its next round of investment expected to close in the spring of 2020. This is the second investment SOSV has made in FreshSpoke since the company participated in its Food-X Accelerator in 2018. FreshSpoke is also a participant in CBA’s istarthub Ontario acceleration program.
Investors from previous rounds include Craig Busch, president and CEO of Busch Group of Companies, Eric Wetlaufer, a board member at TMX Group, Tien Pham, president of Valleytek Inc. and Chris Adams, founder and managing director at Adams Hamilton.
“Over half of households in North America prefer local food and are willing to spend up to 25 percent more to get it,” said Woods. “The restaurants and retailers that are keeping pace with this growing trend want an easy and cost-effective solution like FreshSpoke.”
Image courtesy Cross Border Angels