Tons of food end up in landfills every year due to cosmetic issues (they don't look good in stores) and inefficiencies in the supply chains. TreeDots from Singapore, which claims it is Asia's first food surplus marketplace, wants to help. The company's goal is to create a vertically integrated supply system with a marketplace for B2B and social commerce features that allow consumers to buy in groups. The company is also working to develop its own cold-chain logistics infrastructure in order to get food to end users faster. TreeDots today announced that it raised $11 million in Series A funding. The round was led by Amasia, East Ventures and included participation from Seeds Capital and Active Fund as well as actress Fiona Xie and author Nir Eyal.
TreeDots has now raised $15 million in funding. This money will be used to expand its operations in Malaysia (where it expanded last year), enter new markets, and to continue optimizing TreeLogs, its logistics and supply chain business. According to the startup, its gross merchandise volume (GMV), has increased more than 4x over the past year.
TreeDots was established in 2017 as an F&B surplus food marketplace. It later expanded its business to include Social Commerce. One-third of all food in the world is never consumed. TreeDots says that inefficient supply chains and visually "imperfect" food are the main reasons for this. A grocery store might refuse to buy a chicken that's too large or with a broken bone. F&B businesses, like restaurants, don't usually care about how the ingredients look because they prepare and plate food before it reaches their customers. TreeDots' surplus food market was initially created to sell food to F&B companies at as low as 90% compared to other suppliers.
TreeDots' chief executive officer Tylor Jong stated in an email that the company doesn't redistribute food purchased from retailers. We solve the food loss problem further downstream, where food is not in good condition due to different cosmetic standards set up by buyers (businesses but ultimately driven by consumers), and food in surplus because most countries want to ensure all varieties are available and keep more stock than necessary at each step of the supply chain.
TreeDots can help suppliers earn incremental revenue as well as save money on shipping surplus products to the landfills. TreeDots helps them digitize and manage their business through its app, onboard to TreeLogs, and other tools. Jong explained that the logistics infrastructure was constructed using both in-house services and external services to meet demand from social commerce buyers and business buyers. He said that it is more efficient than traditional cold-chain logistics because it is tech-driven and strives for greater utilization, higher delivery density and best practice.
East Ventures managing partner Roderick purwana stated that while food loss is already a billion-dollar problem, what really got us excited was how suppliers began to use the system for all their revenue and not just food loss products. TreeDots could deliver five delivery trucks to the same zone if one of its trucks could do so. This could be done across all suppliers. This network density results in lower logistics costs and emissions.