Addressing the pressing issue of food waste, Los Angeles-based ProducePay has successfully raised $38 million in a Series D funding round led by Syngenta Group Ventures, with participation from Commonfund, Highgate Private Equity, G2 Venture Partners, and others. The latest infusion of capital brings ProducePay’s total funding to $136 million.
ProducePay, founded in 2015 by Pablo Borquez Schwarzbeck, focuses on providing transparency and flexibility in the global fresh produce supply chain. Schwarzbeck’s experience on his family’s farms in Mexico and later with the Giumarra Companies highlighted the challenges growers face, including steep competition for contracts and inefficiencies in the supply chain.
The platform offers a two-pronged solution: supply chain monitoring and financial products. ProducePay supplies working capital to growers and distributors, aiding them in covering operating expenses, technology upgrades, and land acquisitions. Post-harvest, liquidity is extended to strengthen growers’ cash positions for subsequent growing cycles and allows distributors to attract growers with faster and larger payouts.
ProducePay’s approach aims to tackle overproduction caused by farmers’ fear of losing contracts, a significant contributor to food waste. Beyond financing, the platform provides supply chain visibility tools, creating “predictable commerce programs” where retailers commit to fixed pricing and volume before the growing season.
CEO Pat McCullough emphasized the success built on trust, with over 60 commodities across 20 countries benefitting from ProducePay’s funding, totaling over $4.5 billion in harvests. The company’s revenue increased by 76% last year compared to 2022, with trade volume on the platform nearly tripling. Transaction volume is on track to reach $2 billion by late 2023.
The latest funding will support ProducePay’s expansion into Europe, Asia, Africa, and Australia, as well as the growth of its team, currently comprising around 300 full-time employees. McCullough expressed confidence in the continued growth of the fresh produce industry, driven by consumer demand for healthier food choices.
Investors, including Syngenta Group Ventures, recognize the potential of ProducePay’s innovative approach to transform the fresh produce supply chain and reduce food waste on a global scale.