FreshDirect, a US online food retailer, has closed a USD189 million investment round led by JP Morgan Asset Management on behalf of its PEG Digital Growth Fund II, returning investor W Capital and other investors advised by JP Morgan Asset Management, including the AARP Innovation Fund.
“We are thrilled to partner with a group of world-class investors led by JP Morgan Asset Management at this pivotal time for FreshDirect. The funding will fuel expansion into new markets, increase capacity with new manufacturing and distribution facilities, and launch new businesses that meet today’s consumers’ needs as their preferences and buying habits evolve,” says Jason Ackerman, FreshDirect’s co-founder and CEO.
Larry Unrein, head of JP Morgan Asset Management’s private equity group, and Ashmi Mehrotra, managing director, have joined FreshDirect’s board of directors.
“As demand for fresh ingredients delivered to your door continues to rise, high quality food, produce and packaged goods providers are drawing significant attention from the investment community,” says Unrein. “FreshDirect is one of the first to connect its customers with farmers and artisans at the click of a button. The company is also expanding its reach through the new mobile, on-demand offering FoodKick. By meeting the demands of the modern shopper on these two fronts, FreshDirect remains a forward thinking leader in this growing market segment.”
Profitable since 2010, FreshDirect exceeds USD600 million in annual revenue primarily through its online market shares in the New York and Philadelphia metro areas. According to e-commerce research firm Slice Intelligence, FreshDirect leads all measured online grocery merchants nationwide in monthly sales per customer.
“FreshDirect is an established innovator, has a solid roadmap for growth and a large addressable market. We were passionate about FreshDirect a year ago and believe the company is well positioned to continue to lead the online food retail sector. We’re grateful for the opportunity to increase our share,” says Katie Stitch of W Capital Partners.
“The AARP Innovation Fund is focused on supporting companies that are developing new services and products focused on the interests and needs of people age 50-plus and their families,” says AARP executive vice president and chief financial officer Scott Frisch. “FreshDirect’s ability not only to provide customers with fresh, healthy food, but to deliver it directly to their home makes the company an ideal fit with AARP’s investment strategy.”
