“Lanch Secures $27M Investment to Revolutionize Fast Food with Social Media Twist” | TechCrunch

E-commerce startups in the food industry are attracting a lot of attention and funding. Investors are eager to support concepts that connect with consumers and can grow sustainably. Recently, Germany’s Lanch secured €26 million (about $27 million) to fuel its expansion. The company uses social media and influencers to create popular food brands and distribute them through retail networks.

Lanch’s latest funding round, led by Felix and HV Capital, marks a positive milestone for the startup. While the company hasn’t revealed its valuation, estimates suggest it could be between $100 million and $150 million, considering it has raised around $34 million so far.

The company’s CEO and co-founder, Nono Konopka, shared that the funding will help Lanch grow within Germany before exploring other markets. Since launching, Lanch has introduced three brands: Loco Chicken, Happy Slice Pizza, and Happy Chips, which is a line of potato chips.

Lanch’s strategy combines market data from social media with influencer partnerships to identify consumer preferences and gaps in the market. This approach has proven successful; in the year and a half since its launch, Lanch has expanded into 350 ghost kitchens. The hot food offerings, particularly Loco Chicken, are primarily sold through popular delivery platforms.

The brand has gained significant visibility through collaborations with major social media influencers. For example, Happy Slice Pizza saw a phenomenal debut, with 30,000 pizzas sold in just one weekend, thanks to promotions by online personalities like Knossi and Trymacs. The launch of their first physical Loco Chicken location created such a buzz that it drew huge crowds and required police assistance to manage the influx.

“Half of the population in Germany knows our brands,” Konopka says, emphasizing their ambition to build a brand on the scale of Raising Cane’s or Chick-fil-A.

Additionally, Lanch’s potato chips are currently available in over 10,000 supermarkets, and they plan to introduce another snack product soon.

This growth highlights a trend: startups are leveraging social media and data to innovate and sell new food products. Konopka considers Lanch a technology company due to its data-driven approach. With 350 delivery locations, they gather valuable insights on consumer behavior that guide decisions on where to establish physical restaurants.

This data also helps Lanch understand food preferences to inform future product development. Their marketing strategies, primarily centered around social media, allow them to tap into consumer interests without the high costs associated with traditional marketing.

However, the food tech sector has faced challenges. Many startups in fast delivery and online groceries have struggled, resulting in significant losses. Issues with supply chains and product-market fit have led to a high failure rate among direct-to-consumer food brands.

Experts like Frederic Court from Felix note that costly marketing strategies often derail D2C food startups. Lanch’s efficient operations and cost structure make it a more appealing investment, contributing to its success.