The Rounds, a startup that offers scheduled deliveries of groceries and household essentials in reusable packaging, announced a $24 million Series B funding round on Monday. The new capital will be used for product development, hiring, and expanding its services to additional markets.
Alongside the funding announcement, The Rounds also introduced new features for customers, such as one-time purchases and flexible delivery date options, and enhanced its AI-powered algorithms to better predict when customers need to restock their products.
Launched in 2019, The Rounds allows consumers to order weekly bundles for a $10 subscription. Items range from household essentials and personal care products to groceries and dry goods, as well as products from local bakeries, coffee roasters, and other merchants. The Rounds recently added more than 100 new products, bringing more fresh produce and household essentials to its catalog. The new additions bring the total number of SKUs to 12,000, nearly double last year's 650.
Users can customize how often certain items are restocked and set up recurring deliveries to ensure they never run out of essentials like toilet paper, milk, eggs, etc. Until recently, customers couldn't choose a weekly “restock day,” as The Rounds determined the date for each neighborhood. Now, customers are free to choose a restock day that works for their schedule.
Committed to sustainability, The Round delivers its products in reusable bags and refillable containers. The company also uses a “reverse logistics” system where customers leave empty containers at their doorstep and delivery workers return them, sanitizing and recirculating them, significantly reducing waste. To date, the company has eliminated more than 1 million pounds of packaging waste, a major milestone compared to the 375,000 pounds of waste TechCrunch previously reported.
Image credit: The Rounds
The Rounds recently introduced a new feature that allows users to make a one-time purchase rather than automatically restocking products before the next delivery, helping to prevent users from receiving products they don't want. While users were already able to add or remove products before a delivery, this new option ensures that they won't forget to remove products they don't want.
The company is applying machine learning to get smarter at predicting when to replenish everyday items and provide personalized product recommendations. Co-founder and CEO Alex Torrey says these predictions are becoming even more accurate than before, bringing the AI closer to becoming a “psychic home manager” that knows exactly what customers need to replenish and when.
“Prediction accuracy is where our sustainable approach of using reusable packaging provides an invaluable benefit,” Torrey says. “By collecting empty containers after customers have finished their drink, we create a reinforcement learning feedback loop in our prediction engine, allowing us to more accurately and quickly forecast consumption at a household level.” [All that competitors] You can make predictions based on your purchase history. You can make predictions based on your purchase history. [but] We also have data based on consumption.”
He added that the goal in the future is to make the forecasting algorithms so advanced that, for example, “pollen counts can affect the predictions.” “My dream is to see a world where we can say, 'You have allergies. Pollen counts are going up. It looks like pollen counts are going to be up next week. Let's speed up the tissue count,'” Torrey explained.
Image credit: The Rounds
The Round is currently available in a few US markets, including Atlanta, Washington, D.C., and Philadelphia, but Torrey said The Round plans to expand to “several” more markets in early 2025, though he declined to say which ones. However, we do know that New York City is not yet on the company's radar.
“The reason we picked our markets is to learn as much as we can. The downside of launching in New York is you don't get to learn how to operate outside of New York. Atlanta is a lot like Houston or Los Angeles. Philadelphia is a lot like Boston. So we've been thinking about markets where we can learn a lot and apply those learnings so we can be a company that can work anywhere and really have a big impact by serving as many members as possible,” Torrey said.
The latest round was led by Moderne Ventures, with participation from Construct Capital, First Round Capital, FJ Labs, Redpoint Ventures and others. The company is currently focused on expanding its machine learning and data science teams and is looking to hire a chief marketing officer and chief operating officer.
To date, The Rounds has raised $66 million in funding.