The philanthropic arms of Australia’s wealthy The Vincent Fairfax Family Foundation (Cambooya) and The Myer Foundation, as well as Allan English, the founder of the listed restaurant and kitchen equipment leasing firm Silver Chef are investing A$2.6 million in Yume, which is described as Australia’s first surplus food online marketplace.
The venture is also backed by other family offices and high net worth investors. In 2016, Yume secured an A$100,000 Impact Investment Ready Growth Grant from Impact Investing Australia.Launched in March 2016, Yume connects food suppliers with buyers on an online platform. This permits vendors to list and sell surplus products to generate revenues, minimising waste.
Yume also facilitates the donation of surplus products to food charities such as OzHarvest, FoodBank, Fareshare and SecondBite.
The latest round of investment will see proceeds invested in expanding throughout Australia, supporting the development of a new technology platform in a capital raising, which will be led by investment advisory firm Impact Generation Partners.
According to statistics from Australia’s Department of the Environment & Energy, in 2013 it was estimated that food waste cost Australian households in excess of A$8 billion per annum, with 2011 estimates indiating Australians generated 361 kilogrammes of food waste annually per person.
It estimated that 6.8 million tonnes of carbon dioxide was released as a result of sending organic waste (i.e. food waste) to landfill in 2011.
Barriers to effective food waste management in Australia include the complexity of food production, purchasing and consumption patterns; a lack of established infrastructure and technology for the alternative treatment of food waste; and a lack of consumer awareness. Yume attempts to overcome this through addressing supply-side challenges and streamlining the process for food vendors.
In an official statement, Yume CEO Katy Barfield explained: “Dealing with the problem of food waste in Australia cannot be addressed by food rescue services alone. Importantly, surplus does not need to mean substandard product. These products are not on our platform because they are inferior. They are there because of cancelled orders or cancelled promotions (among a number reasons).’’
Food on Yumes’ platform is white-labelled, in order to protect vendor identity and prevent their brand from devaluation. Australian food distributor PFD Food Services is among Yume’s first customers to list its surplus on the platform, alongside seafood manufacturer Pacific West, which claims to have seen improvements to its bottom line while reducing its waste and environmental impact. International hotels major Accor is also a use of the platform, using it to purchase discounted products.
One possible exit trajectory for Melbourne-based Yume, which has expanded into Sydney, is a listing on Australian Securities Exchange (ASX).
In an exchange with The Australian, Jenny Wheatley, CEO of the Vincent Fairfax family office, also known as Cambooya, has disclosed that it invested almost A$1 million in Yume with expectations of generating a comercial return. She said,
“This went through our usual due diligence process with our investment finance committee. They gave it a tick from the commercial perspective. Frankly, we are backing the team. We believe in Katy and her team and that they will deliver on a commercial return basis. But it is at the higher end of the risk curve. The Fairfax family’s rural heritage is important in this. We have strong faith in the viability of agriculture in Australia. We see this as a mission-aligned investment and they are not easy to find.’’