Nothing gold can stay — not even bright apples from the Sunshine State. One Santa Barbara company aims to slow fruits and vegetables’ inevitable decay by adding an additional protective layer of peel to fresh produce, protecting it from environmental stressors and extending its sales and transport life. By lengthening items’ time on shelves, Apeel Sciences claims it reduces food waste, increases retailers revenue and streamlines supply chains.
The company announced on Tuesday it received $250 million in funds, with local residents and celebrities Oprah Winfrey and Katy Perry joining the company as minority, non-participatory investors. The fresh round now brings the food tech startup’s valuation to $1 billion, making Apeel the LA area’s newest unicorn.
To create its protective peel, Apeel uses parts of the plant that typically go unused after harvesting — like peels, seeds and pulp — to form a powder. Retail and supply chain workers then add water to the Appel powder and spray, dip or brush the resulting glaze on produce. The glaze forms a thin, edible layer of material on the surface of items like oranges, which slows down their water loss and oxidation, two factors that cause produce to rot.
“Longer lasting fruit means you have the capability to build bigger displays, allocate more shelf space, a proven tactic to growing sales, as well as cross-merchandise throughout the store,” a spokesperson wrote in an email to Built In.
Apeel can be found on Costco and other store shelves in the United States, Germany and Denmark. The company said retailers that use Apeel experience an average 50 percent reduction in shrink, and up to 10 percent sales growth. The company plans to use the funds to expand its presence in sub-Saharan Africa, and Central and South America. Later this year, a spokesperson said Apeel will also announce plans to support smallholder farms in Africa.
“With double the shelf life, suppliers can ship without the worry that produce will spoil during transit, which also enables them to ship to areas where they may not have been able to in the past,” a spokesperson said.
Founded in 2012 with a grant from the Bill and Melinda Gates Foundation, the latest round brings total investment in Apeel to $360.1 million. The approximately 300-person company currently has 20 open positions listed on its website, including engineering, marketing and project management. GIC led the round, with participation from Viking Global Investors, Upfront Ventures, Tao Capital Partners and Rock Creek Group.
