Food waste in the US is a big problem. About one-third of what's made ends up in landfills instead of being eaten, which leads to extra production, packaging, storage, and delivery, all harming the environment. A study in Science shows that food production causes 26% of the world's greenhouse gas emissions.

Food delivery services such as HelloFresh, Blue Apron, and EveryPlate provide consumers with precisely what they need for particular recipes to help mitigate food waste.

New York-based Startup: Hungryroot

Hungryroot, a startup grocery delivery and meal solutions based in New York, is taking a step further in addressing food waste. Utilizing artificial intelligence, this 9-year-old company offers a highly curated experience by delivering precisely the amount of food a consumer will use.

Five years ago, well before artificial intelligence became the latest business buzzword, Hungryroot embarked on a journey to develop a digital shopping assistant capable of selecting a week's worth of groceries for customers and providing recipe suggestions. After transitioning to an AI-powered business model in 2019, Hungryroot experienced significant revenue growth driven by its increasingly intelligent shopping algorithm.

Ben McKean, Founder and CEO of Hungryroot, attributes the company's remarkable growth to the strategic pivot towards AI-driven personalization, where Hungryroot experienced its most significant growth surge ever in 2022, with revenues soaring by 47% year-over-year, reaching $238 million and continued into the first half of 2023, with a remarkable growth rate of 67%.

Launched in 2015 as an e-commerce consumer products company, Hungryroot initially offered six diverse vegetable- and noodle-based meals designed to be fresh, healthy, and convenient alternatives to traditional frozen dinners.

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AI-Powered Business Model

Hungryroot's approach involves customers answering various questions about their food preferences, allergies, health objectives, and how or when they cook to discern the most suitable recipes and grocery items for each customer and provide a personalized and efficient shopping experience.

Hungryroot is meticulously designed to provide customers with the foods they need for their week. It offers straightforward recipes to ensure customers know exactly how to utilize the ingredients provided. As a result, its customers experience a notable reduction in food waste. Hungryroot also provides users with a list of items in their weekly cart, allowing them to approve or make changes as needed.

Hungryroot's Own Waste Management

The company can also minimize its waste. For instance, if it determines that a user has no preference between broccoli and Brussels sprouts, and there is an abundance of broccoli in its warehouse, Hungryroot will recommend broccoli to the user to help optimize inventory management and reduce potential waste within the company's operations. Hungryroot stated that these processes result in 80% less food waste at its facilities compared to a traditional supermarket. Investors also highlight that this unique model benefits the company's bottom line.

Jeremy Liew, a partner at Lightspeed Venture Partners, noted that Hungryroot has been profitable for three or four years, which is uncommon in many e-commerce food businesses. Liew attributed this success to their efficiency in spending and the strong customer loyalty driven by the business they have built. 

Hungryroot is backed by L Catterton, Crosslink Capital, KarpReilly, and Lerer Hippeau, in addition to Lightspeed, and has raised $75 million in funding.

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