Vengo, a six-year-old, Bethpage, New York-based startup that makes touchscreen vending machines for a wide variety of uses and clients, has raised $7 million in new equity funding, shows a new SEC filing.
That roughly doubles the amount of money the company has raised over the years, including from such notable investors as Brad Feld, Gary Vaynerchuk, Tony Hsieh, David Tisch, rap mogul Nas, and Joanna Wilson, among others.
Vengo makes wall-mounted mini-vending machines the size of large picture frames that it then sells to vending machine distributors, asking for a small fee per month in exchange for access to its software. Its customers then either advertise on the video screen that appears, or sell their products in Vengos. (It charges them an additional fee per month per product per machine.)
Each time a sale is made, both the customer and Vengo is notified via cloud-based inventory monitoring. Payments are cashless. And sensors allow automatic refunds if a product isn’t received.
The company first gained attention three years ago, when it competed on the ABC show “Shark Tank,” with cofounder and CEO founding Brian Shimmerlik walking away a deal for $2 million in venture debt, to be paid over three years at 7 percent interest, in return for 3 percent of the company.
Vengo’s machines sell six items at a time, generally electronics (think battery packs and cables at hotel kiosks), personal care products (Kiehl’s was among its earlier customers), and snacks, which it sells at colleges like New York University and at health clubs, among other places.
According to the outlet Inc., which runs an annual list of the 5,000 (!) fastest-growing private companies, Vengo ranked 620th this year, based on 2017 revenue of $3 million and three-year growth of 807 percent. Much of that growth has come from customers in its home state of New York, though the company has been steadily expanding its geographic footprint.
It’s bucking a broader trend, apparently. Overall, the vending machine market has been slowing owing to competition from convenience stores, supermarkets and micro markets. According to the market research firm IBISWorld, annual growth for vending machine operators between 2013 and 2018 was negative 2.9 percent.