Blue Apron's $2B idea for home cooking

New York-based startup Blue Apron has grown to a $2 billion valuation in less than three years. CEO Matt Salzberg discusses the company's growth and future plans.

Blue Apron and the Booming Meal Delivery Business

By Ecommerce FOXBusiness

As cooking shows continue to proliferate, viewers are looking to whip up gourmet meals at home. But hunting down a long list of ingredients can be cumbersome --- and costly.

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And it is not just consumers spending money on leftover ingredients that go unused. Grocery stores also see food go to waste, with upwards of 25% of perishables thrown out.

Looking to solve this problem, home cooking startups are multiplying, with Blue Apron, Plated and HelloFresh leading the pack.

The venture-backed businesses send out recipes alongside perfectly portioned fresh ingredients to subscribers, making it easy to cook meals worthy of sharing on social media.

Blue Apron is “reducing waste from every part of the supply chain,” said CEO Matt Salzberg, in a video with FOXBusiness.com.  They see themselves as the catalyst that is “transforming the way that people in this country eat,” and they are looking to “change the way fresh groceries are delivered.”

Kent Bennett, an investor through Bessemer Venture Partners, said he believed in the vision because the startup “solved some real convenience issues at an affordable price.” Bennett views it as part of an expanding market because we are now seeing grocery shopping “shift online in a meaningful way.”

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The Blue Apron team is not the only team betting on the industry. Partly driven by the success of the GrubHub (GRUB) IPO, over $500 million was invested in food delivery startups last year, according to Pitchbook data.

Some of these startups, including Munchery and Sprig, focus on ready-made meals. And other competitors are emerging from transportation-focused startups like Uber, who are venturing into food deliveries. Amazon (AMZN) and Google (GOOGL) are also expanding their online grocery programs.

But with so much competition and the possible reclassification of part-time contractors, it is unclear how the landscape will all shake out.

“This is a multi-billion dollar opportunity and there will be multiple winners,” said Nick Taranto, co-founder at Plated. “Success will be determined by building a great brand with great service and great food. The recipe is simple. The execution is very hard.”