HelloFresh was founded in November 2011 by Dominik Richter, Thomas Griesel, and Jessica Nilsson in Berlin, Germany. Richter and Griesel packed and hand-delivered the first 10 customers. It was one of the earlier companies in the meal-kit industry. They were initially funded by Rocket Internet, a German startup studio company. They first started delivering meal kits to paying customers in early 2012, and expanded to the Netherlands, UK, US and Australia the same year. By 2014, the company claimed to be delivering 1 million meals per month. They raised $50 million in a 2014 funding round, after having raised $10 million in 2012 and $7 million in 2013. By March 2015, the company had 250,000 subscribers, although it was still not profitable. In September of that year, it was valued at €2.6 billion in a funding round where it raised €75 million, making it a unicorn company. The company was still majority-owned by Rocket Internet at that time. It cancelled a planned IPO in November, due to concerns about the company's proposed value. It experienced significant growth during the year, with 530,000 subscribers by the end of October. It had 750,000 subscribers by July 2016, and 1.3 million by the third quarter of 2017. In October 2017, the company announced a planned IPO on the Frankfurt Stock Exchange to raise $350 million. On November 2, the company completed its IPO, valuing it at €1.7 billion. At the time of its IPO, the company had a market capitalization of more than double Blue Apron, its largest US-based competitor. In March 2018, HelloFresh acquired Green Chef, a US organic meal-kit company. In October 2018, Toronto-based HelloFresh Canada acquired Chefs Plate, a Canadian meal-kit company. In 2019, Rocket Internet sold its remaining stake in HelloFresh by accelerated book building to international institutional investors. Rocket Internet had held 30.6% of HelloFresh as of the end of 2018.
Business
HelloFresh's business model is to prepare the ingredients needed for a meal, and deliver them to customers, who must then cook the meal using recipe cards, which takes around 30–40 minutes. It generally provides about three two-person meals a week for about $60 to $70. It offers a choice from about 19 recipes. In the United States, HelloFresh offers a wine-subscription service, based on that of its competitor Blue Apron. In several markets, it provides "Rapid Box" meals which take only 20 minutes to prepare. The company's US operations were responsible for 60% of revenues as of November 2017, and it has approximately 44% of the American market. HelloFresh also has operations in the United Kingdom, Germany, Austria, Switzerland, the Netherlands, Belgium, Luxembourg, Sweden, France, Australia, New Zealand, Canada, Denmark. HelloFresh has been criticized for the excessive packaging of their delivered meals, leading to waste. The company has also been criticized for its continually high marketing costs, which have prevented the company from being profitable. A related concern is the low customer retention rate of the company. According to an independent analysis, less than 50% of customers remain subscribers after the first week, and less than 10% remain after 6 months. The company disputes these findings.
