US meal-kit business Chef’d has closed down.
It is understood 350 employees of the El Segundo, California company have been laid off, including workers at its Pico Rivera warehouse.
Reports said chief executive and founder Kyle Ransford told employees in an email on Monday (16 July) Chef’d had run into financial issues.
“Due to setbacks with financing, unfortunately, we are ceasing operations for all employees, effective today, July 16, 2018,” Ransford is reported to have said in the email. “If we had been successful with these funding efforts, this difficult decision would have been avoided.”
Chef’d would not comment.
The company, which had been involved in a part of the market in the spotlight and attracting interest from major players in the industry, had in the last year secured investment from two large US food manufacturers.
Last August, the company raised US$25m from US meat giant Smithfield Foods – owned by China’s WH Group – adding to a $10m round two months earlier from Campbell Soup Co. and online grocery delivery business Fresh Direct.
At the time of its investment, Smithfield said it and Chef’d would use its “portfolio of brands for meal kit solutions across a variety of occasions”.
It added: “Chef’d will be able to leverage Smithfield’s national distribution network and facilities to expand its ability to serve consumers with next-day delivery services.”
Chef’d was founded in 2015 and had an estimated valuation of $160m after its last fundraising efforts.
But when asked for a reason for the firm’s demise, a former company insider told just-food: “I would suspect it is because of poor performance in the e-commerce unit.”
However, the insider added: “I think there are opportunities for the business to continue with a new operator/management team.”