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Image: Phood

Startup Spotlight: Phood is taking the uncertainty out of food waste for kitchens

August 21, 2020

Food waste has been one of the biggest themes explored by agrifoodtech entrepreneurs and investors in recent years. Images of empty store shelves may convince some that food waste isn’t an issue, but according to one founder that is far from the case.

“Food waste loves uncertainty and Covid-19 brings it on high. Most obviously, the pandemic has drastically changed consumer purchasing trends and increasingly disrupted food supply chains,” Luc Dang, CEO at Phood Solutions, told AFN.

“But, just because shelves are empty, doesn’t mean waste isn’t happening.” 

Dang believes that supply chains are “a mess” and aren’t capable of handling stresses and strains like those brought on by the pandemic.

“The good news is tech can help. Food businesses that have the bandwidth are looking at this moment as a real opportunity to invest in smarter, more sustainable long-term visions,” he said.

“It’s like, we’re basically starting from scratch anyway – might as well do it more efficiently.”

Dang’s role in the food waste space started long before his entrepreneurial days. Born in rural Connecticut, he grew up with rescued mustangs and bee hives. The family’s leftover eggs were given to local restaurants. While working in corporate finance after graduation, he read a statistic about how much food produced in the US never makes it to market, and Phood was born. Since then, he’s been recognized by Forbes 30 Under 30 as a leader in sustainability and is an emerging thought leader in the power of source reduction. 

As restaurants continue to operate under tight restrictions, finding ways to cut profit loss is even more appealing. A number of efforts have emerged. In one example, nonprofit ReFED launched a $1 million grant fund to provide a portfolio of organizations with funding to prevent over 10 million pounds of food — or 8.3 million meals — from being wasted. Each successful applicant will receive on average $50,000 in non-recoverable grants.

Phood’s offering is another example. Its back-of-house hardware and software system serves as a measurement tool for kitchen crews, allowing them to pinpoint exactly what’s being wasted. Read on for our conversation with Dang.

AFN: What is your technology?

Luc Dang (LD): It’s a B2B product with a hardware and software duo that serves as a measurement tool for back-of-house kitchens. Our three-part system combines smart scale, tablet, and AI-driven software. We use computer vision to quickly identify food items that are placed on the scale, and measure how much of it comes in and out of the kitchen. Phood software aggregates that data and gives operators insight into not just what is being wasted, but why. With that, we provide data insights to directly impact purchasing decisions, staff behavior, menu creations, and the supply chain. 

The Phood X is a compact, lightweight waste-tracking alternative for kitchens with highly specific needs.​ It is perfect for hot bars, donation stations, and more. The Tabletop model utilizes our powerful tracking technology with both portability and precision. The Phood XL Model fits seamlessly into a kitchen routine. Daily food waste is disposed of as it normally would be. Every item thrown away is immediately detected by our smart scale and integrated AI camera, before being logged to a comprehensive cloud-based data analytics platform. 

Who are your customers?

Our target customers are consumer-facing food businesses ranging anywhere from grocery stores to corporate dining halls, contract food services, to restaurants. 

What are some of the biggest challenges that you’ve faced and how have you overcome them?

Phood works as a top-down solution and we take the same approach to industry. Our product was designed for impact, and to execute that we need to start at the top. Bridging the startup-enterprise gap has been a challenge, but we’ve found a lot of success in accelerator programs like TechStars and Food Foundry, that create that bridge with intention. 

Six months ago, companies like Cargill and Gordon Food Service were pretty rooted in their ways, but that can’t be said for anyone right now. As the world starts moving into new business models and redesigning work processes, why not incorporate something that you know will be beneficial? Phood’s ethos is timely, and to be tapped into spaces that give us their ears and mentorship has been really important for the business.  

So you participated in accelerator programs. What were the benefits?

Last year, we participated in Techstars Farm to Fork accelerator program and just a couple weeks ago collaborated with Gordon Food Service and 1871 through Relish Works’ Food Foundry bootcamp.

Techstars brought us invaluable partnerships with some of the largest industry leaders in the world and Food Foundry really helped us ensure that we are exactly where we need to be right now. Every day is heads-down for us at this stage, so to have the opportunity to look at the business on a high level with incredibly insightful people is an opportunity that we’ve been really intentional about taking advantage of. 

What has your fundraising experience been like? Who are your investors?

The Techstars Farm to Fork program helped us raise our pre-seed round, and since we started our seed round in July we’ve been busy in meetings. Food tech is a pretty hot space right now and conversations around a changing food system are only growing. Margins are thin, the public demands social responsibility, and the planet needs quick action. Phood checks all the boxes and investors are excited about how this moment can contribute to long-term visions. 

How have your investors added value beyond capital? What do you look for in an investor?

Their insight is huge, especially about scalability and navigating enterprise. We look for investors with strategic value who care about our ethos and value proposition – people who have a hunger and compassion for change. While we are working from a top-down ethos, we don’t just want to throw all of our eggs in one big shiny basket. We’re looking to work with people who know the business and want to work alongside our team to develop sustainable growth and impact.  

Do you expect Covid-19 will lead to permanent changes in your industry?  

I do. The food industry in itself is changing rapidly and being forced to adapt to an incredibly uncertain world. There’s a lot of pressure on the supply chain and consumer trends, so companies are looking for ways to track and manage that. How can we better manage uncertainty? How can we help businesses better understand their operations and maximize profit? Doing it through waste might not be as sexy, but it is more impactful to your bottom line and something the public is ready to champion. 

Are there any other startups that you looked to for guidance, or as a model when you were getting started or as you scale up?

We’ve been able to glean a lot of insight from conversations with startups like Replate and Flashfood about things that they do well, and we don’t necessarily have all the expertise in. The really awesome thing about people in this space is that they’re largely willing to help because, at the end of the day, we’re all working toward the same goal. 

Most recently, we’ve been looking to Goodr as a model for expanding our social partnerships angle. The brand is fantastic and their CEO Jasmine Crowe is dynamite. We’re looking for ways to work closely with diversion partners to go beyond the product and pave a way toward a world of zero food waste. They’re exactly our target. 

Any advice for other startups out there?

Fall in love with the problem, not your solution. By adapting and changing with an issue, you’re more adept to bring value to a company, even in the midst of uncertainty like we’re seeing today. 

Check out a list of other promising technologies combatting food waste throughout the supply chain here.

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