Determined to be the leader of innovation in the grocery sector, Albertsons Cos. today announced the creation of a fund of up to $50 million, in partnership with venture capital firm Greycroft, that will be used to cultivate up-and-coming grocery companies and technologies for the industry.
Albertsons said its investment in the fund is part of its broader technology strategy to provide insights and expand its partnerships with new and emerging technologies in the grocery sector. With a goal to reach $1 billion in e-commerce sales in 2018, the Boise-based retailer has acquired meal kit company Plated, expanded its home delivery services via Instacart and announced its pending acquisition of Rite Aid.
The fund will utilize New York-based Greycroft’s investment expertise and connections into the emerging technology industry.
“Albertsons Cos. is committed to meeting customers wherever and however they like to shop, and part of that is being at the forefront of the tremendous innovation our industry has seen over the last five years,” Shane Sampson, Albertsons’ chief marketing and merchandising officer, said in a statement. “As we saw with our recent acquisition of Plated, Albertsons Cos. has the capital, scale and expertise to power future growth of the most promising emerging businesses and technologies across the food and grocery space.”
Annual online retail sales of food and beverages in the U.S. are expected to exceed $20 billion in 2018, according to Coresight Research. Since 2013, investment in the food and beverage sector has more than tripled.
As the industry continues to be disrupted by start-ups and strategic partnerships—such as Kroger’s agreement with British online retailer Ocado to facilitate online grocery delivery via the company’s robotic warehouses—Albertsons and Greycroft aim to serve a leading role in investing and developing new and innovative companies with its $50 million fund.
“As our e-commerce companies scale, they often incorporate a brick-and-mortar strategy to reach the entire U.S. market. This partnership with Albertsons Cos. will enable our companies to tap into their 34 million weekly customers across a wide range of industries, including consumer products, healthcare, wellness, pharmaceuticals and grocery,” Ian Sigalow, co-founder and partner of Greycroft, said in a statement. “We believe that consumers should be able to get access to these high-quality products and services whenever they want, wherever they want—and that requires a coast-to-coast footprint.”
Venture capital firm Greycroft focuses on investments in the internet and mobile markets, leveraging its network of media and technology industry connections to help entrepreneurs gain visibility, develop strategic relationships and bring their products to market. The company manages more than $1 billion and has made more than 150 investments since its inception, including Plated, Shipt, Acorns, Venmo and Thrive Market.