Within the crowded field of meal-kit companies, only Blue Apron has tested the public markets. The results haven’t been pretty.
Blue Apron had planned to sell shares at $15 to $17 a piece and ended up cutting that price to $10 in late June. The company, which is scheduled to report quarterly results on Thursday for the first time since its IPO, has since lost 38 percent of its value, closing on Wednesday at $6.24.
Plated, another competitor in the market, said in a filing on Monday that it’s raising $12 million in debt, which could be a sign that the equity markets have soured for at least some companies in the space. Plated didn’t respond to a request for comment. Other competitors include HelloFresh, Home Chef and PeachDish.
Ransford highlighted two primary characteristics that differentiate his company from Blue Apron and other players. The first is that Chef’d, which delivers hundreds of thousands of meals a month, is not a subscription business, meaning consumers can order whenever they want and from a wide selection of over 1,000 breakfasts, lunches and dinners.
Secondly, Ransford said that Chef’d spends just 1 percent of its sales on promoting the product. Blue Apron, by contrast, spent about 25 percent of its $245 million in first-quarter revenue on marketing. Rather than offering free meals and deep discounts for newcomers and spending heavily on social media, Chef’d relies on partnerships with household brands that have big budgets.