Hazel Technologies, a USDA-supported food waste technology startup based in Chicago, has raised $800k in seed funding. Rhapsody Venture Partners (RVP) led the round with participation from non-profit early stage investor and accelerator VentureWell and food, ag and health-focused investor Valley Oak Investments.
Hazel Technologies is developing technology to increase the shelf life of fruit. It has two products currently — FruitBrite and BerryBrite — which are small packets inserted into fruit packaging. Hazel Technologies has deployed more than 25k of these units across North America, according to Aidan Mouat, Hazel Technologies’ CEO and co-founder.
“We’re receiving more demand than we can possible fill for our products, so the money will be targeted at expanding the organization, making new hires and expanding our production capacity in order to fully onboard customers throughout 2017,” he told AgFunderNews. “A lot of our customers see this as a new post-harvest tool to enable them to expand their geographical reach, as well as provide new revenue opportunities.”
Hazel Technologies will further use the money to expand sales and marketing, grow the seven-person team and buy equipment to manufacture the product.
According to Mouat, BerryBrite utilizes a proprietary combination of essential oils to prevent the growth of bacteria, fungi and molds in berries; while FruitBrite uses an extended release technology that prevents ripening, and is effective for transportation and storage of ethylene sensitive produce such as avocados, melons, and cherries.
“The packaging inserts emit active ingredients into the storage atmosphere around the produce that biochemically slow the aging process and helps fight the influence in mold and fungus on the produce,” Mouat said. “The goal is to extend produce shelf life and improve produce quality during storage and transit.”
So far, Hazel Technologies has completed a dozen successful commercial pilots to customers who cumulatively ship more than 500 million pounds of produce per year. Another dozen customers are expected in the year ahead.
Members of RVP joined a team from Hazel Technologies on the road to visit customers and validate the solution that will make a difference in reducing food spoilage, and they were highly impressed at what they witnessed.
“This is a product that was ready to go and that was compelling to us,” Bernard Lupien, general partner at RVP, which is committed to reducing food waste, told AgFunderNews. “They have a solution that works and have customers and they’re going to be a success.”
“We invest in applied sciences and engineering startups, so we’re not exclusively agtech, but we made an investment in Apeel Sciences out of Santa Barbara a couple of years ago that addresses some of the similar problems, but in a different way,” he added. “We got to know this space and when we met the Hazel team, we were blown away by how much progress they had made commercially in two years with a product that worked with so many field trials and customers.”
Hazel Technologies officially launched in March 2015 but the five founders met at an accelerator program at Northwestern University a year earlier. The technology was the joint creation of Mouat and Dr. Adam Bressler Preslar.
FruitBrite and BerryBrite are just the first products in Hazel’s planned portfolio; it is planning to create more post-harvest solutions and is anticipating one to two new products by the end of Q2 2018.
Looking ahead, Mouat foresees a Series A for the backend of this year.
“We targeted full-scale service for at least a half-dozen customers this year and now the goal is to expand our team to 14, move to positive cash flow, and double the size of our reach by the end of 2017,” he said.