Founded in 2009 by acupuncturist Neka Pasquale, Urban Remedy ships freshly prepared food to branded kiosks across California and 16 company-owned stores (a 17th will open this weekend in San Diego), as well as direct to consumers’ homes across the US from its 30,000sq ft production facility in Point Richmond, CA.
It is also exploring supplying its best-selling ‘power SKUs’ such as bars and juices to retailers in club stores and other channels as its brand gains traction.
Speaking to FoodNavigator-USA after teaming up with model and actress Kate Upton to create new three-day meal plans/kits – a move that will significantly raise the brand’s profile (Upton has 12million followers on social media and started highlighting the brand to her 5.9m Instagram followers yesterday) - CEO Paul Coletta said he was on a mission to prove that “there is a business model that can crack the code on ultra-fresh.”
We’re trying to crack the code on fresh
He added: “Our investors say Urban Remedy is one of the most exciting but terrifying businesses they are in, and I get that.
“It’s a huge challenge to scale a three-day shelf life business, but we’re trying to crack the code on fresh, to redefine fresh as ultra fresh - as close to nature as possible, minimally processed, and nutrient dense - and I hope to prove that the consumer wants this and is looking for companies like Urban Remedy to deliver it.
“The kiosk business grew by more than 300% in the latest quarter vs the prior quarter and we’ve been expanding with multiple regional including Mollie Stone’s, Jimbo’s, Draeger’s Market, and Woodlands Market and every one of these partners has asked us to expand to all of their stores.”
Kate approached us…
Coletta, who recently closed a $17m series B fundraising round with lead investment from 301 INC, General Mills’ venture arm, said the deal with Upton would help Urban Remedy reach a wider audience beyond its core territory in California in the next 12-18 months.
“Kate approached us. She’s been buying Urban Remedy products for three years to help her stay healthy on the go [Urban Remedy products are all fresh and ready to eat and require no prep].
"She is launching a new online fitness brand called Strong4Me Fitness and wanted to partner with us to come up with a three-day food plan, so she worked with our founder Neka to curate a plan that fit with her lifestyle and had all her favorite Urban Remedy foods from salads to shots to snacks.”
Food waste is our #1 enemy
While it might seem to add layers of complexity, Urban Remedy’s vertically integrated business model (it makes its own food) and omni-channel strategy has been a key part of its success, claimed Coletta, who is gearing up for a move into a second market outside the Bay area for the kiosk/retail side of the business.
“All of our channels – the company-owned retail locations, the fresh food kiosks in Whole Foods and other locations, and the direct to consumer business - work together to be greater than the sum of their parts. And with the exception of three animal proteins, 100% of our products are made by us – six days a week, two shifts a day.”
Aside from the fact that consumers may discover the brand in one channel (eg. a Whole Foods store) and then buy the products online if they don’t live in northern California, having an omni-channel operation has also helped Urban Remedy succeed whether others have failed in managing waste, claimed Coletta, who joined the business in 2014.
“First, having three channels has just helped us scale more quickly. When you are trying to scale a fresh food business, food waste in your #1 enemy and an omni-channel model goes a long way to mitigate that challenge.
“For example, if you have your own retail stores, you can develop new products and test them out before you bet on them bigger by putting them into wholesale or online, so only our top 30 selling SKUs go to our kiosks whereas as own stores have on average 80-100 SKUs . We’re a vertically integrated incubator.”
The Holy Grail in waste is 5% of sales
Coletta is not yet ready to announce which markets outside of California Urban Remedy is targeting next, but explained that owing to the products’ short shelf life, the radius for delivery from the hub is a 10-hour drive.
“We do real time manufacturing. Our stores place their orders in the afternoon, the products are made that evening and delivered the following morning. The Holy Grail in waste is 5% of sales. Anything less than that and you’ve left business on the table. We’re not there yet but we’re very close.”