Investing in Shef - A Homemade Food Marketplace
M13 has been a long time investor behind the trends shaping the future of food. Today it is more clear than ever that two of the most powerful forces changing food are the consumer desire for delivery and health. We believe that the future of food is delivery regardless of whether it's coming from a grocery store or a restaurant.
As COVID hit households and wallets, our investments in brands that offer both health and home delivery -- including Daily Harvest and Thrive Market -- have seen incredible demand. To complement those convenient nutritional offerings in the freezer and pantry is one of our newest investments. Shef is a homemade food marketplace that helps talented cooks make a meaningful income by selling homemade food to their communities.
In thinking about what a delivery dominant industry might look like, we became convinced that companies need to address the cost structure underlying the industry rather than build on top of existing infrastructure. The traditional rule of thumb in the restaurant industry is that costs break down to roughly 1/3 ingredients, 1/3 labor, and 1/3 other costs including rent and related expenses. Realizing this, we have been looking for businesses who are re-imagining the typical cost structure in ways that drive better consumer value.
Shef combines the convenience and variety of takeout with the quality, nutrition and freshness of a homemade meal. These types of businesses are being enabled by new home cooking laws such as California’s Homemade Food Operations Act. Shef’s consumer value proposition is truly unique - great quality, home-style food delivered to your door at an affordable price.
After spending a year solidifying its infrastructure and prioritizing its customer and chef experience, Shef is expanding as the leader in home cooked meal delivery. In March, Shef experienced a significant surge in demand as more families had to stay in and more people needed to make a flexible income from home. Some “shefs” who struggled to find work or lost their jobs during COVID are now making $1,000 per week on Shef. In addition, Shef is working within local communities by partnering with hospitals and homeless shelters to feed frontline healthcare workers and vulnerable populations.
There has never been a more critical time to maintain safety. Shef has always prioritized food safety on the platform and requires that all shefs prepare meals in accordance with the highest safety standards.
Shef’s co-founders are proud to deliver authentic homemade food to more tables while also helping to ease economic hardship. Co-founders Joey and Alvin have a deep appreciation of the immigrant journey. Alvin was raised by Iranian refugee parents in a southern CA motel; like other immigrants, his parents tried their hand at different businesses, including a restaurant. Joey grew up with a deep appreciation of his Sicilian culinary roots and launched two healthy food brands before the founding of Shef.
We are so proud of Shef’s ability to connect consumers with delicious homemade meals prepared from recipes handed down through generations. The company’s infrastructure and growth have taken on an even greater urgency with the challenges facing restaurants and the industry’s 11M employees who confront continued uncertainty.
Congratulations to Shef on your $8.8M seed round! We are thrilled to invest alongside our friends at Y Combinator and Craft Ventures and many great operators from Instacart, TaskRabbit, StubHub, AngelList, Lyft, Airbnb, and Yelp.
If you want to try Shef for yourself, please head to www.shef.com (and bring your appetite!).