Paul Bulcke, Chairman, Nestlé. Photo credit: World Economic Forum, licensed under CC BY-NC-SA 2.0

Food and beverages giant Nestlé has announced that it’s acquired Freshly, a New York-based meal delivery startup, taking control in a $1.5 billion deal split into an upfront value of $950 million and potential earnouts of up to $550 million. The acquisition marks a big win for Freshly, which was founded only five years ago and took $107 million in outside funding.

Before the acquisition, Nestlé was already an investor in Freshly, having led a $77 million round for the company that gave it a 16% stake in 2017. Other investors in Freshly who scored significant wins from its acquisition include the likes of Insight Partners, Highland Capital Partners, and Blue Ivy Ventures.

Freshly is a prepared meal delivery company that caters to healthy eating for its customers. The company works on a weekly subscription model whereby fresh, chef-cooked meals that can be heated and served in as fast as 3 minutes are delivered to customers. Freshly has fared very well since its launch in 2015 and says it’s on track to clinch $430 million in sales this year, notably during a pandemic that has widely boosted the demand for meal delivery services.

With the deal already completed, Freshly is now housed under Nestlé as one of the Swiss food giant’s many brands.

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