Stockholm-based Karma has raised $12 million in Series A funding, led by Swedish investment firm Kinnevik. Participants also included U.S. venture capital firm Bessemer Venture Partners, appliance manufacturer Electrolux and previous VC firm backer e.ventures. This latest round brings Karma’s total funding to $18 million.
Founded in late 2015 by Hjalmar Ståhlberg Nordegren, Ludvig Berling, Mattis Larsson and Elsa Bernadotte, Karma is an app-based marketplace that allows local restaurants and grocery stores to sell unsold food at a discount directly to consumers. Users register their location with the app, then browse various food merchants and food items/dishes that are on sale. Consumers pay through the Karma app and pick up the food before closing time. There is also the option to follow favorite establishments and receive alerts when new food is listed each day.
“One third of all food produced is wasted,” Karma CEO Ståhlberg Nordegren told reports. “We’re reducing food waste by enabling restaurants and grocery stores to sell their surplus food through our app … Consumers like you and me can then buy the food directly through the app and pick it up as take away at the location. We’re helping the seller reduce food waste and increase revenue, consumers get great food at a reduced price, and we help the environment [by] redistributing food instead of wasting it.”
Karma currently works with over 1,500 restaurants, grocery stores, hotels, cafes and bakeries, which can sell to 350,000 Karma users. The app is a marketplace partner with three of Sweden’s largest supermarkets, as well as premium restaurants like Ruta Baga and Marcus Samuelsson’s Kitchen & Table, and major brands such as Sodexo, Radisson and Scandic Hotels.
Earlier this year, the company launched in the U.K., and is already working with over 400 restaurants in London, including Aubaine, Polpo, Caravan, K10, Taylor St Barista’s, Ned’s Noodle Bar and Detox Kitchen.
This new funding will enable Karma to further develop its product range and expand to new markets, starting with Europe. The company will also expand its workforce, growing from 35 people in Stockholm to over 100 across five markets by the end of next year, and to over 150 people by mid-2020.