Meet the startup behind Hilton’s recipe for curbing food waste

FoodMaven warehouse
Alice Stern/FoodMaven
David Lindquist, left, and Josh Wiest of the FoodMaven supply team work with a customer.

This article was adapted from the newsletter VERGE Weekly, running Wednesdays. Subscribe here.

Software entrepreneurs such as SpoilerAlert and Copia have been cultivating "marketplaces" for selling and donating excess fruits, vegetables and other food for several years.

What makes fellow startup FoodMaven’s approach unique isn’t just its backers, who include the Walton family and former Whole Foods co-CEO Walter Robb. It’s the company’s secret ingredient in getting excess food off shelves and onto plates — investing in local distribution facilities and networks.

"You have to do logistics," FoodMaven CEO Patrick Bultema, raised in a Northern California farming community, told me earlier this week when we caught up about his company’s progress. "If you do just the software, you’re not going to make a difference."

Today, the U.S. food system relies heavily on a tightly centralized production and distribution system — akin to the electric grid. That has made it extremely difficult to closely match supply with demand — grocery stores overorder to avoid shortages, especially when bad weather may be on the way. Simply put, the system isn’t "agile" enough to respond. The key to breaking that cycle and getting "lost" food to places where it can be consumed will be more localized networks that can be replicated regionally, Bultema suggested.

FoodMaven, which has raised just shy of $20 million to this point, got its start in the Colorado market, where it has been helping link three sorts of companies that will be instrumental in changing consumption habits: suppliers including local processors, growers and grocery stores; independent restaurants that don't have the buying clout or obligations of chains; and institutional foodservice organizations that serve hospitals, schools and hospitality companies.

One of the company’s first big-name customers is Hilton. FoodMaven is facilitating deliveries to its properties in both Colorado and Texas. The startup is aiming for national coverage within five years and is actively engaged in discussions in cities including Houston, Atlanta, Chicago, Detroit, St. Louis and Kansas City, according to Bultema.

To cap off our conversation, I asked Bultema to share some lessons FoodMaven, which now employs just shy of 100 people, has learned during its early days. Here are some things to ponder:

Meat me there: More than 50 percent of what FoodMaven is placing is protein. That’s partly because meat can be frozen, which gives the company more flexibility and time when it comes to finding a buyer. But federal regulations are very strict: FoodMaven wound up buying a facility capable of grinding meat (it had the license to do so) in order to help sell perfectly good, "out of spec" cuts of meat that have been rejected by grocery stores, usually because the boxes they were shipped in had gotten damaged.

The more flexible the menu, the better: When FoodMaven was founded, the company thought prisons would be good customer prospects. Not so, reports Bultema. Apparently, most of them publish their menus weeks ahead, which means it’s difficult to change things up. Hospital cafeterias, on the other hand, often offer daily specials for guests and visitors. That makes them a very good prospect for FoodMaven’s marketplace.

Keep your eyes on blockchain: One reason so much food is "lost" is that it’s invisible. That is, data about various items has to be recreated at virtually every step of the way. That’s one reason FoodMaven is involved in industry-wide efforts aimed at driving a common standard for traceability, one likely to use blockchain technology.

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