Taking advantage of the surge in online grocery generated by COVID-19, Farmstead plans to bring its dark store fulfillment model to a third market: Raleigh-Durham, N.C. The expansion will be fueled by a $7.9 million funding round that brings total investment in the company to $14.5 million.
Farmstead began in the San Francisco Bay area and announced plans in September 2019 to expand into the Carolinas. Charlotte, N.C. was its first new market in this region, and Farmstead plans to launch in Raleigh-Durham, N.C. in early 2021. Additionally, the retailer has begun offering its Grocery OS software to other retailers seeking to add a delivery component to their services.
The retailer uses a dark store model and proprietary AI-enabled technology to efficiently deliver grocery items within a 50-mile radius and reduce food waste. Three-quarters of Farmstead customers are on its weekly recurring program, which provides them with a regular delivery slot and discounts on staple items.
“The Farmstead team worked hard in 2020 to perfect the dark store model and the underlying proprietary technology that makes Farmstead so incredibly efficient,” said Pradeep Elankumaran, Co-founder and CEO of Farmstead in a statement. “We are laser focused on expanding Farmstead’s national brand and adding more partnerships with grocery chains, helping them increase their daily delivery capacity while driving long sought-after profitability with each order.”