Food comparison platform Foodbomb has raised $1.4 million in funding, following 12 months of consecutive month-on-month growth.
The funding comes from early-stage venture-capital firm EVP, with EVP investment director Justin Lipman joining the startup’s board.
The startup, headed up by founder and chief Paul Tory and chief operating officer Josh Goulburn, took home the first-ever Smart50 StartupSmart award in November last year.
Since then, the team has been “doubling down on what’s going well”, while also testing and learning from the market, Tory tells StartupSmart.
For the past 12 months, Foodbomb has seen month-on-month growth, he says.
It’s working with 50 Sydney suppliers and has about 300 active users purchasing produce through the platform. The startup typically turns over about $500,000 every month, Tory says.
“We don’t need to do a lot differently … Whatever we’re doing, it’s working well,” he adds.
The funding will mainly be used for “trying to fine tune it all”, Tory says, and growing the Sydney-based team.
Tory will be bolstering Foodbomb’s team of developers, as well as onboarding staff with skills in digital marketing, user experience and customer success.
The founder is working on laying down the foundation of the team, “now we’ve got some money to grow”, he explains.
“The big opp for us is the platform is great, and it works well. We have a roadmap to enhance it that’s as long as my arm,” he adds.
However, he stresses the hiring process will be focused on quality, not quantity.
“We’re hiring very slowly, looking for the right fit culturally,” he says.
According to Tory, now was the right time to seek VC investment —until now, the startup has been backed by friends and family funding.
“Any earlier would have been too early. VCs need a track record,” he says.
While the team met with “a bunch” of potential backers, EVP just “got it straight away”, Tory adds.
The investors were won over by the balance in the leadership team, Tory says. He has experience in the wholesale food industry, while Goulburn’s expertise lies in growth and strategy.
But the startup’s growth so far also spoken for itself, the founder says.
“The sheer numbers were impressive.”
And from Foodbomb’s perspective, Tory says EVP was “supportive from day one”.
The VC liked what the startup was doing, and didn’t set about trying to control it in any way.
EVP also brings connections in the food service industry, and a clever and experienced team, Tory explains.
“Everyone talks about smart money. I think they’re smart money,” he adds.
Test and measure
With a background in wholesale food, Tory launched Foodbomb with his eyes wide open.
“I knew the industry very well, but I also knew the dark side of it: terrible work hours, constant chasing of money.”
Launching a startup has been “a new start for me”, he says.
And it’s one that appears to be paying off.
“I was the poker player who went all in. I put all my money into this and backed it,” Tory says.
Just last month, Foodbomb surpassed its records in every metric it measures, securing the highest sales in a single week, its biggest day yet, its highest number of new registrations, and more.
“I can’t tell you how excited I am to go to work every day,” Tory says.
However, he has some advice as to how other founders can achieve the same feeling, and similar growth.
“Test and measure,” he advises.
Whether it was market channel, cost of acquisition, or anything else, “we really wanted to be certain of every metric before we double down on it”, he says.
Foodbomb conducts user testing and has active conversations with its customers — both on the supplier and vendor sides of the business.
The team may think they know what customers want, but “we soon discover that’s not right”.
In particular, Foodbomb has seen supplier feedback leading to changes in the platform, which in turn keeps them on board.
“We’re building out lots of features at the request of suppliers,” Tory says.
“We’re all working on the same team.”