Singapore-based TreeDots, which operates a surplus food marketplace for businesses and individual households, has landed USD 11 million in a Series A round co-led by Amasia and East Ventures.
With the fresh funds, the company is set to accelerate its regional expansion and scale up its business operations. “The scaling comes with two parts, which includes building the right team and technology,” Tylor Jong, co-founder and CEO of TreeDots, told KrASIA in an interview, adding that the firm is looking to hire more middle to top-level managers and tech talents.
“We realized that a grocery chain might not buy a chicken that is too big or has a broken bone because it looks funny on their shelves. But food and beverage outlets don’t care because they will cut it, plate it and make it look nice before serving. So if they can purchase essentially the same product at prices up to 90% cheaper than alternatives, they are very happy,” said Jong in the release.
One-third of food produced in the world is wasted. It is often incinerated or sent to landfills, where it creates methane, a powerful greenhouse gas, according to a study by the University of California, Davis.
TreeDots’ platform allows food suppliers to sell their surplus goods that are rejected by supermarkets and restaurants, while individual consumers as well as food and beverage establishments can purchase the food items at heavily discounted prices. The firm enables consumers to purchase the imperfect goods in a group-buying model that trims logistics costs.
Apart from its marketplace, the firm recently launched TreeLogs, an app that digitalizes suppliers’ cold-chain logistics operations. “Southeast Asia’s logistics landscape is very underinvested, especially in the cold chain. The best logistics practices in the B2B food supply chain aren’t as mature as e-commerce. We need to fill the gap,” Jong added. Cold chain refers to the process of managing the temperature of perishable goods in order to maintain their quality and distribution from one place to the other.
Half of TreeDots’ revenue comes from its logistics business, while its distribution business accounts for the other half. TreeDots is not profitable yet, the co-founder said. Since its inception in 2018, the firm has logged 400% growth year-over-year in gross merchandise value, according to the company.
“Food loss is already a trillion-dollar problem, but what got us really excited was the fact that suppliers started to use the system for all of their revenue, not just food loss products. If one of their trucks could make one delivery to a zone, TreeDots could make five deliveries on that same trip working across suppliers. The increased network density allows for decreased logistics costs and lower emissions,” said Roderick Purwana, managing partner at East Ventures.
Active Fund, Seeds Capital, author Nir Eyal, and actress Fiona Xie also participated in the round.