Key facts:
- Nestlé acquired a majority stake in the UK meal kit startup Mindful chef.
- The startup, founded in 2015, has already raised more than £9M.
- The pandemic has helped Mindful Chef to grow, and the startup is on a path to reach £50 million in sales this year.
- Gousto, Mindful Chef’s main local competitor, also raised £25M to become the second European meal kit unicorn (startup whose valuation is greater than 1 billion) after HelloFresh.
Why it matters – DigitalFoodLab’s opinion:
After Freshly’s acquisition for €1.5B, is Nestlé starting a shopping spree of food delivery startups? As for many past acquisitions in the sector, more and more CPG corporations (leaders and smaller players) are looking for ways to reach the final consumer with DTC (Direct-To-Consumer) brands and delivery startup acquisitions.
For the startups, this makes even more sense. The competition will stiffen at the end of the lockdowns as the main challenge of meal kits will come back: making consumers stay and avoid both the huge churn rates seen and the increase in acquisition costs seen in the pre-pandemic months. These may get even stronger as many expect a steep deterioration in the economy in the coming months. Consumers, free to shop “normally,” may feel that the price of meal delivery is too high. Startups will need the know-how, the supply chain, and big corporations’ firepower to keep growing.
