Gourmet food delivery Freshly raises $7 M, moves headquarters to NYC
Back in the day, when you thought of food delivery, Chinese food and pizza came to mind. Today, the idea of having eggplant parmesan, kale salad and Mongolian beef delivered to ones’ home is more the norm. This trend comes from the high adoption rate for on-demand and subscription food delivery services.
Tempe-based startup Freshly, a subscription-based, gourmet ready-made meal delivery service, has grown at such a rapid rate that they are expanding operations to the east coast.
In addition, the company recently raised a Series A of $7 million led by Highland Capital Partners, bringing their total funding to $9 million.
Co-founded by Michael Wystrach and Carter Comstock, the two friends founded the company out of a need to eat healthier, but didn’t really want to go through the hassle of cooking all the meals-and eating out was expensive and less healthy.
In an interview with Wystrach, he said he learned about the food industry from his parents. A Tucson native, his family owned a steak house restaurant and grew up watching chefs prepare meals, creating new dishes and servicing customers.
In 2012, Wystrach had a need to eat healthier and lose some weight, but the idea of cooking it himself wasn’t as appealing as having one of the restaurant’s chefs prepare a delicious meal.
As a result, he and a few chefs experimented with some healthy new dishes. After one week of eating healthy, Wystrach said he lost six pounds in one week and his father lost eight pounds.
Through word-of-mouth, Wystrach began receiving requests for healthy meals and started delivering dishes to customer’s homes. At the time, the most popular dishes included chicken parmesan, and various protein bowls – dishes still on the menu today.
Later in 2012, when Wystrach and Comstock decided to launch their company F3Foods, now Freshly, they consulted Comstock’s father, an M.D. with nutrition and wellness expertise, to review the meal plans and dietary content. Managing nutrition and calories, and using fresh ingredients is at the core of Freshly dishes, Wystrach explained.
Since then, the company has grown at a rapid rate. Wystrach said to date they have over 20,000 users, produced close to 200,000 meals and expanded their employee base from 15 to 60.
The company currently services 10 states and are projected to expand to 35 states by early 2016 and all 48 states by 2017.
With the recent raise Wystrach will expand their operations to New York where they will open up a production facility to cater to the east coast market. Between both offices (Phoenix and New York), he plans to hire up to 150 people by year end with a range of jobs from marketing to fulfillment.
Wystrach did confirm that the company is moving their headquarters to New York City but plans to “rapidly expand our Phoenix facilities and offices,” he said.
When asked about competing with other food delivery giants such as Blue Apron, Munchery or DoorDash, Wystrach said, “We love it. We think it’s great that Blue Apron is getting all this attention and pushing people to where it’s a normal thing, and more accepted, to order food online. We are trying to get a fair share of the ‘Stomach share’.”
How Freshly differs from the competition? “It’s about the experience of having it done for you and the ultimate convenience. We offer great tasting healthy food done for you at an affordable price. For us, we see ourselves as the rising tide,” he said.
Freshly currently offers 36 different meals per month, and in the near future they plan to add more regional tastes and flavors from around the US. In addition, Freshly will be partnering with notable chefs from top restaurants around the country to help create new dishes.
“It’s really easy to eat unhealthy,” Wystrach said. “We want to make it unbelievably easy for people to eat healthy and not have to feel like they have to look at all the ingredients because they know we prescreen all the ingredients and it’s meets our rigorous [health] standards,” he said.
Freshly meals use fresh ingredients, are 100 percent gluten-free, 99 percent soy-free, peanut-free, and the company offers many dairy free meals; they do not offer vegetarian meals at this time.
What’s Wystrach’s favorite Freshly dish? “Sesame Salmon is my favorite, but it really depends on the last dish I ate.”
For the Arizona native and University of Arizona graduate who built a tech company in the desert, Wystrach said, “Phoenix is amazing and the employee base is great. Arizona was an absolutely amazing incubator space. [I’m] excited to be a part of the Arizona community and growing jobs in Arizona.”
The article has been updated since original post. Graphics courtesy of Freshly