British retail titan Tesco and Australian counterpart Woolworths are at the forefront of a consortium of grocery giants supporting a new $125 million investment fund aimed at nurturing start-ups.
In collaboration with Ahold Delhaize, Empire Company/Sobeys, and Shoprite, they’ve launched the W23 Global venture fund to spur innovation within the retail sector.
W23 Global is poised to channel investment into the globe’s most pioneering start-ups and expanding businesses poised to revolutionise the grocery retail landscape over the next five years.
Each collaborating partner is set to contribute $25 million to the fund over this period.
The fund’s mission is to scout for start-ups that leverage technology to enrich customer experiences both in physical stores and online, bolster productivity throughout the grocery value chain, and tackle the industry’s environmental challenges, ranging from agricultural biodiversity to eco-friendly packaging.
The CEOs of each participating retailer will have a seat on the fund’s investment committee, ensuring direct oversight.
Start-ups within the W23 Global portfolio will retain the freedom to engage with any client, be it a partner of the venture fund or not, under terms of their choosing.
This initiative extends Woolworths’ venture into venture capital through its existing W23 Australia fund, established in 2019. This fund has supported enterprises such as Marley Spoon, a meal-kit provider, and All G Foods, a plant-based food innovator.
Veteran of FMCG and grocery retail, Ingrid Maes, who currently leads W23 Australia, will also helm the newly announced W23 Global fund, which will be based in the UK.
Maes stated, “W23 Global is a pioneering international VC fund with a uniquely powerful proposition for both our investors and portfolio companies. At a time when innovation is reshaping retail and value chains across the economy, we aim to offer our investors incomparable access to transformative innovation in grocery and sustainability across the globe. W23 Global will also work with its investors to identify common unaddressed challenges and identify entrepreneurs best placed to innovate new solutions. Our ambition is to offer our portfolio companies faster pathways to global scale, without being exposed to a venture fund anchored by a single strategic investor. With five of the world’s leading grocery CEOs sitting on our investment committee and access to our broader eco-system, our founders can test and develop their ideas quickly based on an accelerated understanding of retailers’ needs.”
Ken Murphy, CEO of Tesco Group, expressed enthusiasm about the collaboration: “We are excited to be collaborating with four other leading grocery retailers in this new investment fund. We are passionate about seeking out the best retail innovations and finding ways to make everything we do sustainable, and this partnership allows us to do that on a truly global scale.”