Logistics technology startup Fabric has landed additional venture backing just four months after announcing a $110 million round, and will use the funding to continue its push to develop automated micro-fulfillment centers for the U.S. market, the firm said today.
Fabric did not disclose the amount of money provided, but said it came from Evolv Ventures, the investment arm of global food and beverage giant Kraft Heinz.
The deal follows the disclosure of Fabric's $110 million "series B" funding round in 2019, which featured funding from Corner Ventures with participation from Aleph, Canada Pension Plan Investment Board (CPPIB), Innovation Endeavors, La Maison, Playground Ventures, and Temasek. That round had brought the firm's total funding at the time to $136 million.
According to Tel Aviv-based Fabric, which was formerly known as CommonSense Robotics, the additional backing is significant because it marks "a resounding vote of confidence from a leading food tech investor and the iconic food company." In fact, Evolv describes itself as a "$100 million venture fund backed by Kraft Heinz to invest in early stage technology companies disrupting the food industry."
Fabric has aligned its technology with the food and beverage sector, saying its micro-fulfillment platform uses robotic technology to enable retailers and brands to offer profitable and fast fulfillment, whether for home delivery, curbside pickup, or store replenishment. Fabric says its approach of building those automated, small-footprint facilities offers users the flexibility to build custom solutions that adapt to the real estate requirements, inventory, volume, and operating and capital expenditure requirements of individual providers.
In October 2018, Fabric launched what it calls "the world's smallest automated fulfillment center," and says that site today processes up to 600 orders a day from a 6,000-square foot facility, providing one-hour delivery capability. In late 2019, the company went live with a grocery site serving same-day deliveries, and Fabric plans in 2020 to "rapidly expand across the U.S. market" in partnership with certain retail brands. It plans to open a site in New York City in the coming months.
The new backing will allow Kraft Heinz to use that approach to "unlock the potential of e-commerce in the retail space" and make sure its products are available in as many channels as possible, according to a statement by Bill Pescatello, managing partner of Evolv Ventures. "Fulfillment is one of the largest issues holding back profitable e-commerce operations for retailers today. We believe the solution lies in more effective technology and automation, and Fabric has the technology, team, and resources to lead this transformation," Pescatello said.
Kraft Heinz is making its investment at a time when e-commerce is "exploding" in the grocery industry, changing buying patterns in both food and consumer packaged goods (CPGs), he said in a blog post. Evolv expects that trend to drive online grocery sales from just 5% today to triple that amount within five years, he said.
Excited to be working with @elram_goren and the team at @fabriclogistics https://t.co/IyZK2x214n— Bill Pescatello (@BillPescatello) February 25, 2020
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