Grocery startup Misfits Market reportedly raises total valuation to $1.1B

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Online grocery startup Misfits Market, known for selling less-than-perfect fruits and vegetables, raised $200 million from investors.

The financing round puts the company at a $1.1 billion valuation, reported Bloomberg, which cited a source familiar with the matter. The latest Round C funding was co-led by Accel and D1 Capital Partners, while other investors such as Valor Equity Partners, Greenoaks Capital, and Sound Ventures participated.

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Misfits garnered customers and sales throughout the coronavirus pandemic, which prompted shoppers to look for alternative grocery options that offer less physical contact.

“We’ve seen a structural shift in buying food online,” Misfits founder and CEO Abhi Ramesh said.

Misfits was founded in 2018 and has a mission to make “affordable, high-quality food more accessible while helping break the cycle of food waste,” according to its website.

The company offers organic produce and other grocery items that are at risk of going to waste. It provides up to a 40% discount to what the same products might be in a comparable grocery chain, according to Tech Crunch.

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Misfits grew its customer base and order volume by five times in 2020, a year ravaged by the pandemic, the company said. It shipped 77 million pounds of food to over 400,000 customers, a demand level Ramesh said was challenging to meet at times.