Farmigo, which is working to make buying locally grown food easier, raised $8 million in a Series B venture capital round.
One of the challenges local farmers markets face is the path of least resistance - although people may want to buy fresh food, it's often more convenient to go to the supermarket.
That's why even though farmer's markets have been growing at 40% a year for the last decade, less than 1% of the US population purchases produce directly from farms.
Farmigo's goal is to make buying locally-grown food far easier by using the Internet to streamline the process.
Sherbrooke Capital and RSF Social Finance led the investment round along with Benchmaker Capital, which also invested in Farmigo's previous $2 million Series A round.
Farmigo is creating what it says its the first "online farmer's market" – one that connects local farmers directly to "food communities" - groups of buyers in workplaces, schools or community centers that want to buy locally produced food.
"The Internet has been collapsing supply chains and rewriting conventional business models for nearly two decades, but until now it has had limited impact on the food industry, which is ripe for change," says Benzi Ronen, founder and CEO. "There has never been a better time to disrupt the status quo and Farmigo is poised to fundamentally change the way food is purchased and distributed."
Farmigo's approach complements that of Ecotrust and Organic Renaissance FoodEx, who are using the Internet to make local food distribution far more efficient.
Members of Farmigo's food communities simply place an order online, where they can pick seasonal fruit, vegetables, eggs, meats, fish, bread, cheeses or wine and cheese. Orders are delivered within 48 hours to a specific community delivery location.
There are already several Farmigo communities in the New York and San Francisco areas.
For example, Etsy, a Brooklyn-based handmade and vintage marketplace, gets fresh local food delivered to its office every week as does Kiva in San Francisco.
Besides making the buying process easier for consumers, Farmigo boost local farms. By selling direct to consumers, farmers can reap 80% of the sale price, versus the 9%-20% they earn by distributing their food through traditional grocers. Farmigo earns a 10% fee for each transaction it facilitates.
"We have been committed to our community-supported agriculture program to bring our locally grown, organic produce to San Francisco residents, but there is a big opportunity to expand it so that far more people have access to fresh local food," says Nick Papadopolous of Bloomfield Farms Organics in Petaluma, California. "We believe Farmigo's approach can really accelerate the amount of people who have access to locally harvested, fresh food. It can have a big impact on improving the efficiency and sustainability of our food system."
Farmigo plans to expand to Los Angeles, Seattle, Portland, Denver, Chicago and Philadelphia.
Started in 2009, Farmigo is already arranging deliveries to more than 3,000 sites that serve 100,000 families.
Here's their website: