The funding round was led by investors Perwyn, BGF, MMC Ventures, and social media fitness influencer Joe Wicks.
According to London-headquartered Gousto, the £33m (€37.8m) will help expand several areas of the business, including services and headcount.
The recipe box supplier plans to build out its 100-strong tech team to support and accelerate innovation within its business model. Launching a Next Day Delivery service, allowing for recipe box customisation, and ‘significantly scaling up’ Gousto’s fulfilment capacity are all in the pipeline.
Concerning headcount, hiring procedures have already kicked off at Gousto’s existing facility in Spalding, Lincolnshire, as well as for its second fulfilment centre due to open later this year.
The company plans to fill more than 400 roles within the next four months both in Spalding and at company headquarters in Shepherd's Bush.
A growing business in a booming sector
This latest funding takes total investment to more than £130m for Gousto, which it describes as ‘one of the UK’s fastest-growing technology businesses’.
The company said it is now trading profitably, with Q1 2020 results boasting a revenue growth of 70% year-on-year.
The recipe box sector, broadly speaking, is also on an upward trajectory. This has now been amplified by the coronavirus outbreak and self-isolation measures.
Prior to the virus outbreak, in 2017, the global sector was valued at $2.52bn. And according to market research company Hexa, it is expected to be worth $9bn by 2025.
In the UK, the market was previously expected to exceed £1.5bn by 2022, yet Gousto suspects this may accelerate.
Given self-isolation measures – which sees restaurants shuttered and people advised to stay at home – most of the developed world will shop for their groceries for the first time, noted the firm. “This forced adoption is likely to accelerate structural change in the market by many years.”
Funding made irrespective of COVID-19 outbreak
While current unprecedented demand for home-delivered recipe boxes is putting strain on the sector, and prompting businesses to rapidly scale capacity, a Gousto spokesperson confirmed the funding was made irrespective of the virus outbreak. Rather, it was planned ‘months before’.
“We already had a recruitment drive to hire another 700 people by the end of 2022, and the outbreak has accelerated the need for more people more urgently,” we were told.
Indeed, Gousto alone is expected to deliver at least four million meals to 380,000 UK households this month. “We are working incredibly hard to meet increased demand and fulfil our commitment to deliver recipe boxes promised to customers,” a spokesperson told us.