Gousto: AI-driven grocery delivery
With eight years in operation, Gousto is deemed one of the UK’s fastest-growing technology businesses in the online recipe box market. The company delivers to the customer’s door a box with precise ingredients and the recipes for people to cook at home.
In April, founder and chief executive Timo Boldt closed a £33 million funding round led by investors Perwyn, BGF, MMC Ventures, and fitness coach Joe Wicks. Gousto has raised more than £130 million in equity investment to date.
Simon Calver, head of investments (Ventures) at BGF, notes that early on, Gousto founder identified the growing trend towards subscription-based services and the increasing demand for high-quality meals. “There are over one billion meals served every week in the UK and we saw huge potential in the business,” he says.
Gousto is a profit-making company. In Q1, the business saw revenue grow by 70% year on year, with over four million meals delivered to 380,000 UK households monthly.
For Calver, the market conditions that favour Gousto is the general trend of eating healthier and home-cooked means can be both healthy and great value.
“All ingredients are fresh, the recipes are tasty and delivered right to your door. The balance of convenience without compromising on quality and variety of meals has been a winning formula for Gousto,” he says.
With a background in finance, Timo Boldt set up Gousto with the mission to become the UK’s most-loved way to eat dinner. “As part of this, we care deeply about offering a more sustainable meal and are proud to have cut 50% of the plastic from our boxes over the last year,” says Boldt.
Gousto uses an artificial intelligence algorithm to tailor meals to customers’ preferences. Boldt explains: “We understand people have different tastes and requirements. Building our own algorithms, we use AI to help understand customer preferences so we serve up a recommended menu with recipes chosen just for that customer.”
Boldt reveals the company is also trialling customisation, which he claims no one else has done globally. “This means customers can swap out a key ingredient in favour of another to suit their requirements and tastes,” he explains.
Boldt says Gousto was experiencing high volumes of orders pre-Covid-19 and recognises a further jump in demand was seen in March and onwards, as households opted for home delivery over supermarket visits.
“Family size boxes have increased by almost a quarter,” he says. “We’re also seeing a peak of 10 times more daily traffic on our website, with an average of three times more daily traffic compared with March.”
Gousto had to stop accepting new customers due to the high volume of sign-ups put pressure on the business. With the relaxation of lockdown measures, the business is also gradually returning to normalcy.
There are 50-plus recipes in the Gousto offering, which Boldt claims to be more than anyone else in the industry. Recipies, which are changed weekly, range from 10-minute meals to vegetarian and plant-based options, with several gluten-free and dairy-free choices each week.
“In line with societal changes, we’ve seen a significant increase in the popularity of meat-free options over the past year,” says Gousto’s chief.
For Boldt, Gousto’s focus on data, AI and automation set the company on course to have put over 400 million meals on tables by 2025.
Next page: Kafoodle
Date published: 18 June 2020