Growing up on a farm by the Connecticut shoreline, Luc Dang lived with his mom and the two kept several dozens of chickens, goats, rescued wild mustangs, geese, and a pony. They would sell eggs to nearby restaurants and as a teenager Dang would work at some of those restaurants.
“I was seeing the waste that happens from farm to fork, and identifying that almost half of that waste comes through consumer facing food businesses, and us as consumers,” Dang says. “We waste a lot of food too with the eyes bigger than stomach syndrome, we order too much so there’s a lot of waste there too.”
So, once he graduated college he came up with the idea to create Phood, a food service platform that uses Artificial Intelligence through computer vision to help food businesses of all sizes cut their food waste.
The company recently announced that it has raised $2 million in seed, led by Chicago-based New Stack Ventures and New York-based fund Story Ventures.
The company’s flagship device, called PhoodX, consists of a tablet, camera and a scale and captures everything that is prepared and produced in that kitchen as well as composted or disposed of. Additionally, it breaks that down using data analytics and machine learning to understand what they are purchasing over producing over serving and what they are wasting.
Phood then gives the users that info back, telling them what their top wasted items are, so they can make changes into what they are purchasing and producing to not only save money but also cut back on that waste.
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According to data from the FDA, in the United States, food waste is estimated at between 30 and 40 percent of the food supply. The EPA estimates that 63.1 million tons of food waste was generated in the commercial, institutional, and residential sectors in 2018.
“Food waste was just something that really didn’t make sense to me,” Luc Dang, who made last year’s 30 Under 30 Social Entrepreneurs list, says. “It was so strange that we could have such a high waste when we have people that literally can’t feed themselves or are food insecure in our own country.”
Phood is currently focused on grocery stores, with its main client being Whole Foods Market. It operates a SaaS-based model, where it works with grocers to sell them a monthly subscription (the subscription depends on the current systems they are using, on the number or volume f the food they are purchasing). The company has seen a 150% revenue growth since the start of 2020.
The company was incorporated in 2019, and participated in TechStars in Twin Cities Minnesota this year.
Nate Pierotti, a deal lead at New Stack Ventures (which led the seed round), says that in the food waste industry it is rare to find a solution that both provides a significant ROI on the bottom line, but also has such an impact on food waste.
“I think one reason why certain industries have been resistant to change, because it negatively impacts their bottom line,” Pierotti says. “And what Phood provided was a solution that solves both problems: it provides ROI and it also prevents food waste.”
According to Pierotti it would be hard to find a more important problem to solve.
“Phood has such a significant impact on greenhouse gases and global warming, while also having a substantial impact on businesses.”