Ever wonder what happens to all those pastries still sitting in the display case as your local cafe shuts down for the day? More often than not, they wind up in the trash.
One company is trying to change that while also helping customers get great deals on delicious food. Too Good To Go is something like a GrubHub for picking up surplus food. Through its app, restaurants and grocery stores with excess goods offer customers a "surprise bag" with food for up to half price from top restaurants, bakeries, and groceries.
The app has become a social media sensation, with TikTokers raving about scoring huge boxes of pastries for just $4 or dinner for two in New York for under $18.
First launched in Denmark in 2015, Too Good To Go has branched out across Europe and came to the United States in 2020. It operates in 24 American cities including New York, Boston, and Los Angeles and will be expanding to nine more over the course of this year.
The company is growing fast, generating more than $79 million in annual revenue in 2023, delivering millions of dollars of additional revenue to business partners, and keeping over 300 million meals from going to waste globally.
The Cool Down spoke to Chris MacAulay, vice president of North America for Too Good To Go, about how the company's rapid growth solves a problem for businesses and consumers in one fell swoop.
🏆 No losers here
"We like to describe our business model as a win-win-win," MacAulay said.
"It's a win for the environment, as food waste is the largest contributor to [carbon dioxide pollution] out there with 40% of all food getting thrown straight in the trash.
"It's a huge win for our partners because they're taking something that was excess and monetizing it, and they are likely getting new customers.
"And then the last one is for consumers who are getting a great deal on really good food. So when we think about the benefit to partners, we're creating something that didn't exist before."
🛍 A grab bag of savings for customers
"Typical savings are up to half off of a surprise bag," MacAulay said. "So it could be a really meaningful deal when you think about the amount of food you'd be getting for spending on average $5, which is what we see in the U.S."
🔱 A three-pronged approach
MacAulay said there are three core components of the value proposition for consumers: "Sustainability, the opportunity to get great food at a great price discounted, and the surprise and delight component of the fact that you make a purchase, you know you're getting a great deal, but you don't know what you're gonna get until you go pick it up."
💸 Delivering millions back to restaurants and groceries
"We're tracking to have delivered millions of dollars back to our partners just in the U.S.," MacAulay said. "Globally speaking, we're saving four meals per second. That's a really large amount of food surplus that we're selling through to consumers."
🔃 Cash & customers for partners
For restaurants, the value proposition is simple: Turn what would get trashed into cash and reduce overall food waste. But there's more to it than just that.
"We typically find that we're bringing new customers in the door," MacAulay explained. "When those new customers come in to a partner that sold a surprise bag, up to 80% of those consumers have an intent to purchase something else in that store or will come back again."
💚 Happier employees
"We see employees that go from having to throw excess food out to making it available in the marketplace," MacAulay said. "We see a rise in their job satisfaction. No one wants to throw away perfectly good food at the end of the day."
🍽 Young, scrappy, and hungry
Too Good To Go already has nearly seven million users on its platform. The demographics for the company's customers typically skew younger and slightly more female, according to MacAulay. "As we continue to grow in the U.S., we're really seeing that we have a high proportion of [users who are] the person who is in charge of the food and wallet decisions related to food purchases," he said. "We're on track to have massive scale."
🤖 AI-optimized
The company just launched an inventory management platform powered by artificial intelligence, designed to help grocery stores make smarter decisions when it comes to food surplus based on all sorts of factors.
According to MacAulay, the platform can take into account everything from expiration dates to how weather might affect shopping habits. Then it makes recommendations on how best to make use of excess food, whether it be donating it or marking it down and selling it on Too Good To Go.
"It's really about connectivity for the full supply chain, from how they're handling inventory on the front end all the way through to the distribution channel that we're able to provide with our marketplace app," he said.
🥗 Impact & connection through food
"Food is one of the most powerful components that we have in terms of bringing people together and driving connection," MacAuley said. Watching customers delight in their surprise bags is one of his favorite things: "That chance to share what a great deal it is, and that we're doing something good — it does reinforce this idea around community and the opportunity to do something that's super easy to do but has such a massive impact."
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