Five grocery retailers, including South Africa’s Shoprite, have established a venture fund called W23 Global.

W23 Global brings together Ahold Delhaize (US, Europe, Indonesia), Tesco (UK, Europe), Woolworths Group (Australia, New Zealand), Empire Company/Sobeys (Canada) and Shoprite Group (Africa).

The collaborative retail venture capital fund will seek to invest $125-million over five years. It is domiciled in the UK.

The fund says it will invest in innovative startups and scale-ups that deploy technology to “enhance customer experiences, transform the grocery value chain and address the sector’s sustainability challenges”.

Each retailer is an equal funder and partner in W23 Global, while their CEOs will sit on the investment committee.

“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,” says W23 Global CEO and chief investment officer Ingrid Maes.

“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,” adds Maes.

“With five of the world’s leading grocery CEOs sitting on our investment committee and access to our broader ecosystem, our founders can test and develop their ideas quickly, based on an accelerated understanding of retailers’ needs.”

The fund’s portfolio companies will be free to contract with any customer.

“In South Africa, we have very unique trading circumstances that are unlike anything our partners in this venture fund have ever faced or had to deal with on a daily basis,” notes Shoprite Group CEO Pieter Engelbrecht.

“In a country with one of the highest levels of inequality in the world, as measured by the Gini coefficient, we at the Shoprite Group have to find more affordable solutions for our customers to sustain their livelihoods, every day.

“This is the driving force behind our need to innovate faster than most retailers and is why we entered this venture with our esteemed global counterparts.”