B2B seafood startup Captain Fresh has raised $25 million in a funding round led by UK government-backed British International Investment (BII) and Andhra Pradesh-based Nekkanti Seafoods Group.
The funding was part of a larger $48 million extended funding round at a $500 million valuation, out of which $20 million had already been raised by the firm in September last year. That round had been led by Japan-based SBI Investment and Evolvence Capital, and had also seen participation from existing investors like Tiger Global, Prosus, Accel and Matrix Partners India.
The company is currently in discussions to secure an additional $3 million in funding from SBI Investment, as revealed by its Founder and CEO, Utham Gowda.
“By supporting Captain Fresh, we are delighted to be able to reach and support more fishermen with improved economic opportunities, as well as to promote sustainable production and reduce wastage. We are also keen to support India’s food exports as a way to support global food security,” Abhinav Sinha, managing director and head of technology and telecoms at BII, said in a statement.
Both BII and SBI Investment are making their debut investments in the firm. Following this fundraising, Gowda will maintain a 19% ownership stake in the company. Matrix Partners will hold approximately 12.5%, while Accel and Ankur Capital will each have around 11 to 12%. Prosus and Tiger Global will each hold about 10%, as per Gowda’s statement.
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The funds will primarily be directed towards expanding Captain Fresh’s operations in the US and European markets.
“We expect to become fully vertically integrated in these markets and evolve from being just an exporter to also distributing on our own (sic),” Gowda said.
Additionally, the company plans to invest in enhancing its supply chain in Southeast Asia, sourcing products from nations such as Indonesia and Malaysia.
The firm recently completed the acquisition of Paris-based shrimp cooker and distributor Senecrus as part of its European expansion strategy, as stated in a release.
Operating in a business-to-business (B2B) model, Captain Fresh supplies fish and seafood to sellers. According to Gowda, over the next two to three months, the company anticipates that more than 50% of its business will originate from the US market, compared to the previous range of 25-30%. Additionally, he mentioned that approximately 80-85% of the total business will be generated from the European and US markets.
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Captain Fresh collaborates with retailers such as Metro, Auchan, and Carrefour, operating across France, Germany, and Poland, as well as in the Middle East. Approximately 2-3% of its business originates from India.
Gowda mentioned that the company had opted to shift its focus from India to international exports, as the latter offered a greater potential for profitability. He further stated that the company had already achieved profitability on a monthly basis and projected to attain full profitability in FY25, although specific figures were not disclosed.
Back in September, Gowda had said that international markets enabled the company to achieve Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) margins of over 15-20%, compared to a 3% EBITDA margin in India.