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99 minutos, Mexico’s last mile delivery startup, raises a $40M Series B

By Marcella McCarthy

In 2014 Alexis Patjane was at a local hookah bar in Mexico City with some friends and the bar ran out of tobacco. They thought maybe they could buy some online and have it delivered to the bar in real-time, but it turns out that service didn’t exist.

At the time, Patjane was running a food truck-making business, which was responsible for about 80% of all the food trucks in Mexico, so he had experience doing business in the region.

A couple of weeks later, to solve the instant delivery problem he had faced at the hookah bar, Patjane launched 99 minutos, a website that sold products and delivered them within 99 minutes, hence the name.

Today, 99 minutos announced a $40 million Series B from Prosus and Kaszek Ventures which it plans to use to grow its business in Latin America. 

The company currently operates within 40 major markets across Mexico, Chile, Colombia, and Peru and offers four services: less than 99 minutes delivery, same-day delivery, next-day delivery, and CO2-free delivery. 

What started as an e-commerce company with fast delivery quickly became a last-mile delivery service for other e-commerce companies.

“We started to build the API connections and plug-ins, and any e-commerce could add our delivery service to their business,” Patjane told TechCrunch.

99 minutos makes money by charging the customer a flat fee for delivery and then offering the driver a flat rate as well, but today, the volume is so large on each route, that it’s become very lucrative.

“We ship about 60-80 packages per route,” Patjane said, and from the consumer’s perspective, the delivery app works similarly to Waze. “You can pause the delivery, you can change the address. You can say, “Oh, I’m not at home, I’m at the Starbucks on the corner, can you drop it off there?”’ he added.

Patjane said that initially, the company offered delivery only within Mexico City, but it quickly grew to offer its services between cities and now operates between 21 cities in Mexico.

“E-commerce is growing quickly in Latin America, but it is still [the] early days. E-commerce penetration in Latin America is at 6%, while China is reaching 30% and the U.S. is at 20%,” the company said in a statement.

“When we hear big e-commerce players saying that 99 minutos is ‘their most reliable partner’ and that they are ‘the provider with the most potential,’ it tells us that the team is executing extremely well and is on a path to disrupt e-commerce delivery in Latin America,” said Banafsheh Fathieh, Head of Americas Investments at Prosus Ventures.

Part of the funds will also be to speed up their city-to-city deliveries. “We’ll be doing same day [delivery] from city to city and will be using small aircraft to connect the cities,” Patjane said.

Flink, the German grocery delivery startup, raises $240M after launching just 6 months ago

By Ingrid Lunden

On-demand grocery delivery, which really came into its own with the emergence of the Covid-19 pandemic, continues to command huge attention from investors. The jury is still out on how people will use those services in the longer term, but in the meantime, the most ambitious of the startups in the field are raising big.

In the latest development, Flink — a Berlin-based on-demand “instant” grocery delivery service built around self-operated dark stores and a smaller assortment (2,400 items) of items that it says it will deliver in 10 minutes or less — has raised $240 million to expand its business into more cities, and more countries, on the heels of strong demand.

Flink — which means “quick” in German — is currently active in 24 cities across Germany, France and the Netherlands. It hasn’t disclosed how many active customers it has, but it targets younger consumers, those with small fridges, those who have forgotten items in their bigger shops, and people who simply don’t want to or can’t shop in the old-style of once every one or two weeks.

“We are on a mission to give people back some of their valuable time during their hectic days and impress them with our service every time they order,” said Flink CEO Oliver Merkel — who co-founded the company with Julian Dames and Christoph Cordes — in a statement. “We want to establish Flink as the top destination for their day-to-day goods at great prices and with instant delivery by our amazing riders. The order growth we have seen over the past weeks has been explosive and we attribute that to the excellent service we are providing to our consumers.”

The size of this all-equity Series A is extraordinary considering that company only launched in December last year. The company is not disclosing its valuation but one person close to the company said it’s “not a unicorn yet.” (Not worth $1 billion on paper, that is.)

The round is being co-led by Prosus, BOND, and Mubadala Capital, and it comes with a very interesting deal attached. REWE — a German supermarket giant — has inked a strategic partnership with the company that will make Flink its preferred partner for smaller shopping grabs, which looks like it will complement the work that REWE is doing to build out its own grocery delivery businesses for bigger baskets. It’s not clear if REWE is actually investing.

This latest investment comes on the heels of Flink announcing, back in March when it was only three months old, a $52 million round from Target Global and earlier backers Northzone, Cherry Ventures and TriplePoint Capital, along with Cristina Stenbeck from Kinnevik, who invested in a personal capacity.

The opportunity for a new startup to get into the market for food — and in this case specifically grocery — delivery, is an interesting one at the moment. On one hand, we’ve been through a year where many cities across Europe have been under shelter in place orders, pushing many more people to turn on online food delivery to get essential things to their doors.

That is to say, demand — at least under current circumstances — has been more than proven out, with many of the biggest providers completely buckling under pressure with crashing sites, very few delivery slots available and many items out of stock on a too-regular basis.

On the other, it’s led to a huge profusion of companies swooping in to fill that gap.

There are other new players like Gorillas, another outfit out of Berlin, which has also been raising big money and has boasted its own $1 billion+ valuation (for what it’s worth: remember, this is all just on paper). Alongside those are also a rush of more mature startups like Glovo (which raised $528 million earlier this year), Kolonial ($265 million earlier this year), Everli and Rohlik (respectively, $100 million and $230 million rounds this spring),  as well as much bigger players like Ocado and of course the brick-and-mortar grocers who are investing big in their own operations.

And there are so many more I’m not mentioning here.

The big question will be whether the market can sustain all of this, and if not, what that will mean for all of these, and all of the money invested in the space. It’s not unlike some of the scramble that took place in restaurant delivery, where a big profusion of regional giants first started out and then started land grabs to pick up others to get better economies of scale, a process that eventually took the most well-capitalized of them global. All of that is still playing out, and in fact some of the biggest of the hot-food delivery companies, such as Deliveroo out of the UK, are also moving into grocery to better diversify.

In that regard, it’s very interesting to see Prosus in this round. The company — the tech giant that was divided out from the rest of Naspers some time ago to better focus investment and attention on the space (it holds a huge stake in Tencent, among other things) — really got burned last year when its long, hostile attempt to acquire Just Eat to combine it with its existing holdings in food delivery was left bobbing in the water after Just Eat instead eloped with Takeaway.

Since then, it’s been very proactive in using capital to plot out its own course. That’s included stakes in Swiggy in India, investing in that Kolonial round, and also today’s news backing Flink.

“The opportunity that exists for online grocery delivery is vast, with the grocery market in Germany alone expected to reach more than €300 billion in the coming years,” said Larry Illg, CEO of Food Delivery at Prosus, in a statement. “The past year has seen many new players entering the nascent market, vying to fulfill the increasing consumer demands. Flink comes to the market offering ultra-fast delivery of items, mostly under 10 minutes, getting consumers what they need almost immediately. Flink’s innovative tech-enabled logistics service combined with the expertise of the team, the quality of the partnerships they have quickly established and the pace of execution within Germany, has been nothing short of impressive.”

“Flink is a pioneer in a new model of commerce that is purpose-built for consumers who expect better, faster, cheaper services,” added Daegwon Chae, general partner at BOND. “We have been impressed by Flink’s ability to scale rapidly while delighting customers through a seamless experience, and are excited to partner together as Flink builds the grocery store of the future.”

“Flink is the rare combination of a great founding team tackling a huge market with a truly disruptive proposition. The grocery retail market in Germany is one of the largest undigitized markets at only 3% online penetration. We believe that the grocery store of the future will be hyper-local, instantly available, and always delighting its customers. With best-in-class operations and strong momentum, Flink can become a major player in the digital grocery sector, and we look forward to partnering with them on the journey,” said Amer Alaily at Mubadala Capital, in a statement.

Instacart speeds up grocery orders with ‘Priority Delivery’ option

By Sarah Perez

Instacart is speeding up grocery delivery. The company announced today it’s debuting a faster delivery service, “Priority Delivery,” in select markets across the U.S. and Canada, with the aim of attracting customers who would have otherwise quickly run to the store for their smaller orders or more urgent demands. At launch, the service will operate in several larger U.S. metros, and will offer deliveries in as fast as 30 minutes, the company says. Instacart is also expanding other speedier delivery services, including 45-minute and 60-minute options, to more cities and retailers in the months to come.

Today, many customers use Instacart to order their larger, weekly or monthly grocery orders, but still run to the store when they need a smaller number of items — like ingredients for tonight’s meal, for example. The new Priority Delivery wants to be an alternative to these shorter trips, effectively becoming the grocery delivery alternative to using a store’s express lane checkout.

In the markets where Priority Delivery is live, it will be indicated by supported retailers in the Instacart app with a lightning bolt icon that notes the expected delivery time, like “30 minutes or less.” Customers will also be given the option to choose Priority during checkout, instead of Standard delivery or a scheduled time, if they prefer.

The company tells us there’s not an item limit nor minimum on these types of orders. However, shorter requests — like milk, a few bags of chips, and a couple of bottles of wine, for instance — will be fulfilled faster than orders where the customer is requesting speciality deli items, a pickup from a bakery, or has a larger basket size.

When the basket size grows larger or the order becomes more complicated, the app will update to display that the 30-minute window is no longer available and display the new delivery time.

Instacart hasn’t yet finalized its pricing for the service, but Priority Delivery will carry an upcharge of some kind. However, the company tells us the fee will be “small” and “incremental,” and will likely be dynamic based on market considerations. It notes that the different delivery options and their associated fees and taxes are displayed during checkout, so there are no surprises.

Initially, Priority Delivery will be available in 5 cities, including Chicago, Los Angeles, Miami, San Diego, San Francisco, and Seattle, across more than 300 store locations, including grocers and speciality retailers. It plans to roll out the service to more markets and retailers over time.

“We know that no two grocery shops are created equal – whether it’s a bulk buy for the week ahead or just a few ingredients for tonight’s dinner – so we’re launching new features that support the many ways people shop for their groceries today,” noted Daniel Danker, Vice President of Product at Instacart, in a statement about the launch. “For many customers, every minute counts when they’re in a pinch and need something in a hurry. With today’s launch of Priority Delivery, we’re redefining the ‘quick run to the store’ and bringing the grocery express lane online for customers,” he added.

In addition, Instacart will expand access to 45-minute and 60-minute delivery options to more cities across the U.S., allowing consumers other options for faster delivery, even if the Priority service is not available.

The move to increase delivery speeds across its footprint could help Instacart better compete with grocery delivery rivals, like Walmart and Amazon’s grocery businesses, as well as Target-owned Shipt.

It also shortly follows Amazon’s announcement last week that it would be shutting down its standalone Prime Now delivery app and website, to instead direct shoppers who want faster delivery on groceries to the Amazon app and website. However, in Amazon’s case, it’s promising 2-hour delivery windows on both Amazon Fresh and Whole Foods; not as low as 30 minutes. Meanwhile, Walmart’s membership-based delivery service, Walmart+, doesn’t currently guarantee same-day delivery even for its paying subscribers, as its time slots are on a first-come, first-serve basis. Among the big names, that leaves Shipt  — which offers same-day delivery, but not necessarily in 30 minutes.

The update may also make Instacart more competitive with other types of fast delivery businesses which don’t don’t serve grocery retailers — like goPuff’s ‘instant needs’ delivery service, Uber Eats Essentials, or DoorDash, which last year expanded to include convenience store items — including things like chips, ice cream, spices, packaged foods, and others that might have otherwise made for a quick store trip.

Instacart’s new service is rolling out now to customers in supported markets.

Glovo splurges $208M on three Delivery Hero brands in the Balkans

By Natasha Lomas

The high stakes game of chess (or, well, consolidation chicken) that is on-demand food delivery rolls on today with a little more territorial swapping in Europe: Barcelona-based Glovo has agreed to buy three of Berlin-based Delivery Hero’s food delivery brands in Central and Eastern Europe — with deals that it said are worth a total value of €170 million (~$208M).

Specifically, it’s picking up Delivery Hero’s foodpanda brand in Romania and Bulgaria; the Donesi brand in Serbia, Montenegro, Bosnia and Herzegovina; and Pauza in Croatia.

There’s some notable symmetry here: Last year Delivery Hero shelled out $272M for a bunch of Glovo’s LatAm brands, as the latter gave up on a region it had already started withdrawing from in its quest for profitability.

Glovo said then that it would be focusing on “key markets where we can build a long-term sustainable business and continue to provide our unique multi-category offering to our customers”.

Earlier this month the Barcelona-based ‘deliver anything’ app also announced it was picking up Ehrana, a local delivery company in Slovenia. So it’s been on quite the (local) shopping spree of late.

Its existing operational footprint covers markets in South West Europe, Eastern Europe and Sub-Saharan Africa. So its attention here, on the Balkans, suggests it sees a chance to eke out profitable potential in more of Central Europe too.

Glovo said the transactions in Bosnia Herzegovina, Bulgaria, Croatia, Montenegro and Serbia are expected to close “within the next few weeks”, subject to fulfilment of closing conditions and relevant regulatory approvals.

While it said Romania will be completed following approval from the competition authority — but gave no timeline for that.

Its splurge on Central and Eastern European rival food delivery brands follows a $528M Series F funding round in April — so it’s evidently not short of VC cash to burn spend.

Commenting in a statement, Oscar Pierre, CEO and co-founder, said: “It’s always been central to our long-term strategy to focus on markets where we see clear opportunities to lead and where we can build a sustainable business. Central and Eastern Europe is a very important part of that plan. The region has really embraced on-demand delivery platforms and we’re very excited to be strengthening our presence and increasing our footprint in countries that continue to show enormous potential for growth.” 

In another supporting statement Delivery Hero made it clear it has bigger fish to fry (than can be served up to hungry customers in the Balkans) right now.

“Delivery Hero has built a clear leading business in the Balkan region in the last couple of years. However, with a lot of operational priorities on our plate, we believe Glovo would be better positioned to continue building an amazing experience for our customers in this region,” said Niklas Östberg, its CEO and co-founder.

A relevant, recent development for Delivery Hero‘s business is the decision to re-enter its home market of Germany — Europe’s biggest economy — under its foodpanda brand, starting in its home city of Berlin this summer (but with a national expansion planned to follow).

This is notable because back in 2018 it sold its German operations to another on-demand food delivery rival, the Dutch giant Takeaway.com — in a $1.1BN deal which included the Lieferheld, Pizza.de and foodora brands — temporarily stepping out of the competitive fray. (Meanwhile Takeaway.com has since merged with the UK’s Just Eat to become… Just Eat Takeaway so, uh, keep up.)

Delivery Hero is returning to Germany now because it can, and because the market is huge. A two-year non-compete clause between it and Just Eat Takeaway recently expired — allowing for reheating (rehashing?) of the competitive food delivery mix in German cities.

Speaking to the FT back in May about this market return, Östberg suggested Delivery Hero has girded itself (and its investors) for a long fight.

“We don’t see necessarily that we are going to go in and win the market in the next year or so. This is a 10-year game,” he said. “Of course we will definitely make sure we put in enough money to be the clear number two, the clear challenger [to Just Eat Takeaway.com].”

Winning at food delivery is certainly a(n expensive) marathon, not a sprint.

There are also of course multiple races being run in markets around the world, depending on local conditions and competitive mix — with the chance that the winner of the biggest and most lucrative races will reach such a position of VC-sponsored glory that it can buy up the top competitors from the smaller races and consolidate everything — maximizing economies of scale and gaining the ability to squeeze out fresh competition to grab a juicy profit for themselves.

Or, well, that’s the theory. Competition regulators are likely to take increasing interest in this space, for one thing. Rising awareness of gig economy workers rights is also putting pressure on the model.

For now, the thin-margin food delivery business needs the right base conditions to survive. The model only functions in cities and ideally in highly dense urban environments. Most of the players in this space also do not employ the armies of riders that are needed to make deliveries — because doing so would make the model far more costly. And in Europe political attention on gig economy workers rights could force reforms that raise regional operational costs, putting further pressure on margins.

Spain has its own labor reforms in train that will affect Glovo in its home market, for example.

Achieving sustainability (i.e. profitability without the need for ongoing VC funding injections) remains a huge hurdle for delivery apps. It will likely require massive market consolidation and/or convincing users to switch from making the occasional order of a hot meal on a weekend to relying on app-based delivery for far more of their local shopping needs — not just lunch/dinner but groceries and toiletries, and other fast moving consumers goods and household items.

It’s notable that super fast grocery delivery is a major focus for Glovo, for example — which has recently been building out networks of inner city dark stores to service in-app convenience store shopping.

Lots of other on-demand app players are also ramping up on that front. Including Delivery Hero — which has been paying more attention to groceries (picking up InstaShop last year in a deal worth $360M).

Glovo building out in Central Europe while exiting markets further afield suggests it believes it can use a concentrated market footprint to drive operational efficiencies and strong order margins through a tightly integrated meal delivery and dark store play.

If it can do that — and offer at least the whiff of profitability — it could make its business an attractive future acquisition target for a larger global giant that’s looking to up the ‘consolidation chicken’ stakes by bolting on new regions.

A larger player like Delivery Hero may even be a potential future suitor — having shown it’s happy to return to markets it left earlier. After all, it surely knows Glovo’s business pretty well since they’ve done a number of market swaps. But, for now, that’s pure speculation.

Zooming out, what the on-demand model of app-based urban convenience means for the future of urban environments is a whole other question — and one which both competition and urban regulators will need to ponder very carefully.

If the rush to scale delivery platforms drives unstoppable consolidation that sees smaller players gobbled up by a few global giants — that can then use their size and scale to outcompete local shops — it may spell even more dark times for the traditional High Street and its family-run bodegas.

Local retail in many places has already been hammered by Internet giants like Amazon. Delivery apps are another high tech threat to bricks-and-mortar shopping. Touch of a button convenience does carry wider costs.

 

Aevum is building a modular autonomous drone for space and terrestrial deliveries

By Aria Alamalhodaei

Logistics and delivery providers are territorially split between Earth and space, with companies like Amazon and FedEx working to master ground, air and drone transportation, and new entrants like SpaceX honing its expertise in space launch.

Autonomous transportation startup Aevum wants to do both. And it was just issued a patent that will help it move dexterously between space launch to low Earth orbit, and air cargo and drone deliveries here on Earth.

The key is Aevum’s unmanned aircraft system, which it calls Ravn X. So far, Aevum has only publicly discussed its plans for the Ravn X in the context of space launches. It works like this: the Ravn X uses conventional jet fuel and takes off from an airport runway, like a plane, but it has a rocket nested in its belly that deploys at high altitude to deliver payload to space. As the second stage detaches, the Ravn X returns to Earth using conventional touch-down techniques, ready for another delivery.

The new Aevum patent, which was issued on May 4, is for a unique modular payload design positioned in the belly of the drone. With the new system described in the patent, that rocket payload module can be switched out for a cargo bay to carry deliveries around the world, or a drone module that can carry up to 264 smaller drones for last-mile delivery services. Theoretically, the Ravn X could depart from an airport, deliver its payload to space, return back to the airport to be reloaded with a filled cargo module, then take off again for earthbound deliveries.

While the exact amount a Ravn X can carry depends on the distance it’s traveling, the Ravn X air cargo will be able to carry up to 15,000 lbs and the space delivery payload will be able to carry up to 330 lbs. As of now, the rockets are expendable, but the company has plans for 100% reusability across its space launch and air cargo operations.

Aevum’s business model includes operating autonomous transportation and logistics as a service and partnering with existing logistics providers. One interesting possibility for the company is partnerships with logistics giants that so far have been effectively cut-off from space deliveries due to the vertically integrated models of companies like SpaceX, which handles logistics and launch services in-house.

“We aim to enable FedEx, Amazon, UPS, DHL, and others to build upon the logistics infrastructure they have already mastered,” Aevum CEO Jay Skylus said. “Any or all of these respected giants could partner with Aevum or purchase a fleet of Ravn X for their own and add space launch to their offerings. Space logistics should no longer be separated from general logistics.”

Aevum founder and CEO Jay Skylus with Ravn X

Likewise, large companies that have struggled to establish drone delivery services could use the Ravn X’s drone module to deliver and deposit drones over a central area, like a city center, for last-mile deliveries.

“The patent is so significant because what the patent allows you to do is say – the existing FedEx and UPS logistics architecture that’s sorting 70,000 packages an hour right now could not service the needs of defense and space because fundamentally that logistics infrastructure was designed to go from Earth to Earth and not Earth to space,” Skylus explained. “But if you really look at the problem and study it in detail, you know the missing link to allow this existing infrastructure to now be able to service the space domain – that missing link is what we just patented.”

Skylus imagines Ravn X fleets operating around-the-clock. “In my company, what matters is asset utilization. For any reusable flying machine, it doesn’t generate revenue on the ground. My machines will fly around the clock, every day,” he said in a statement.

The company still has a ways to go before it still takes to the skies, however. Ravn X is still undergoing ground test operations and will begin flight testing this year at an FAA-licensed testing facility for unmanned aircraft systems. Aevum’s intention is to fly with the United States Air Force’s ASLON-45 mission this fall and to take its air cargo service live next year.

Because the Ravn X has so many different capabilities, it will need to pursue a few different FAA certifications: for space launches, a license from the FAA Commercial Space Transportation office; for cargo operations, an FAA aircraft type certification and standard airworthiness certification.

“What we’ve patented is the next layer and large batch of connections in the global logistics infrastructure,” Skylus said. “Space logistics shouldn’t be separated from logistics that already exist.”

Zoomo raises $12 million to expand e-bike subscription offerings

By Rebecca Bellan

Zoomo, the Australian startup with a mission to electrify delivery fleets through e-bike subscriptions, announced a $12 million interim capital raise on Monday.

The company made a name for itself through partnerships with UberEats and DoorDash to help delivery workers access e-bikes through weekly subscriptions at discounted rates. Zoomo then grew to offer monthly subscriptions to corporate partners in Australia, the U.S. and London for last mile delivery, with a fleet that has expanded beyond 10,000 units globally.

Now, the startup hopes to expand its service outward towards continental Europe and other states across the U.S. It currently operates in New York City, San Francisco, Los Angeles and Philadelphia. Zoomo also wants to build up its consumer model, which mainly serves couriers but is extending to commuters, and will invest in the development of its next generation of vehicle offerings.

“We initially built our products to service the demands of gig workers in the food delivery industry,” Mina Nada, Zoomo CEO and co-founder said in a statement. “Their expectations for quality commercial vehicles, on demand service, flexible financing and tech enabled security features spurred us to innovate. We’re now seeing enterprises and fleet managers benefiting from the platform we have built. Enterprise fleet managers looking for clean and efficient vehicles are choosing us.”

Zoomo’s focus on e-bikes for food delivery makes it unique in the electric bike rental space. Its business model offers a full-stack e-bike, from the hardware and software to same-day servicing and financing options, which especially helps big business partners deploy and manage large fleets of vehicles at scale. It’s a tall order, and Zoomo’s strategy could be leading a new trend in micromobility of being a one-stop-shop that promises quick scalability.

German mobility software provider Wunder Mobility recently announced its efforts to offer a souped up e-moped that’s been co-designed with Chinese consumer manufacturer Yadea for the dockless sharing market. It also launched a new subsidiary to finance the vehicles, along with its software, to shared micromobility providers. Wunder Mobility plans to offer e-scooters and e-bikes for financing in the future, but it doesn’t design its own vehicles or sell them outright. While the business models and target customers don’t perfectly align, the blueprint is the same: Corner a market, provide top quality hardware and software and make it as accessible as possible.

Coronavirus spurred a demand for delivery in all industries, and we can see companies like FluidTruck and Rivian stepping up to the plate to meet the needs of eco-conscious e-commerce giants with their electric delivery vans. The online food delivery industry is no different with a market that’s expected to reach $192.16 billion in 2025 at a compound annual growth rate of 11%. But for delivery within cities, e-bikes offer a smarter solution for meeting climate change goals while dodging traffic congestion.

Zoomo’s custom designed bikes can bear more than 200 kilograms of load via various cargo options, according to a Zoomo spokesperson. For enterprise customers, like health food company Cornucopia, e-cargo delivery vehicles like a Trailer Trike or a Covered Trike are used to deliver goods sustainably. Gorillas, an on-demand grocery delivery company, and Just Eat Takeaway, acquirer of Grubhub and Seamless, are also clients of Zoomo’s.

“At Just Eat Takeaway.com, we want to build a sustainable future for food delivery, and are committed to doing our bit to help keep carbon emissions to a minimum, as well as providing an efficient customer experience from order to delivery,” said a Just Eat Takeaway spokesperson in a statement. “E-Vehicles are an integral part of the Scoober model and we are pleased to work in cooperation with Zoomo.”

Zoomo’s newest funding round, led by Australian VC AirTree, follows an $11 million Series A raised in August 2020, with support in both rounds from the Clean Energy Finance Corporation, Maniv Mobility and Contrarian Ventures. Withrop Square and Wisdom VC, mobility and clean tech-focused investors, also joined this round.

Hangry, an Indonesian cloud kitchen startup with plans to become a global F&B company, closes $13M Series A

By Catherine Shu

Hangry, an Indonesian cloud kitchen startup that wants to become a global food and beverage company, has raised a $13 million Series A. The round was led by returning investor Alpha JWC Ventures, and included participation from Atlas Pacific Capital, Salt Ventures and Heyokha Brothers. It will be used to increase the number of Hangry’s outlets in Indonesia, including launching its first dine-in restaurants, over the next two years before it enters other countries.

Along with a previous round of $3 million from Alpha JWC and Sequoia Capital’s Surge program, Hangry’s Series A brings its total funding to $16 million. It currently operates about 40 cloud kitchens in Greater Jakarta and Bandung, 34 of which launched in 2020. Hangry plans to expand its total outlets to more than 120 this year, including dine-in restaurants.

Founded in 2019 by Abraham Viktor, Robin Tan and Andreas Resha, Hangry is part of Indonesia’s burgeoning cloud kitchen industry. Tech giants Grab and Gojek both operate networks of cloud kitchens that are integrated with their food delivery services, while other startups in the space include Everplate and Yummy.

One of the main ways Hangry sets itself apart is by focusing on its own brands, instead of providing kitchen facilities and services to restaurants and other third-party clients. Hangry currently has four brands, including Indonesian chicken dishes (Ayam Koplo) and Japanese food (San Gyu), that cost about 15,000 to 70,000 IDR per portion (or about $1 to $6 USD). Its food can be ordered through Hangry’s own app, plus GrabFood, GoFood and ShopeeFood.

“Given that Hangry has developed an extensive cloud kitchen network across Indonesia, we naturally would have interest from other brands to leverage our networks,” chief executive officer Viktor told TechCrunch. “However, our focus is to grow our brands since our brands are rapidly growing in popularity in Indonesia and require all kitchen resources that they need to realize their full potential.”

Providing food deliveries helped Hangry grow during COVID-19 lockdowns and social distancing, but in order to become a global brand within a decade, it needs to operate in multiple channels, he added.

“We knew that we will one day have to serve customers in all channels, including dine in,” said Viktor. “We started the hard way, doing delivery-first business, where we faced the challenges surrounding making sure our food still tastes good when it reaches customers’ homes. Now we feel ready to serve our customers in our restaurant premises. Our dine-in concept is an expansion of everything we’ve done in delivery channels.”

In a press statement, Alpha JWC Ventures partner Eko Kurniadi said, “In the span of 1.5 years, [Hangry] launched multiple brands across myriad tastes and categories, and almost all of them are amongst the best sellers list with superior ratings in multiple platforms, tangible examples of product-market fit. This is only the beginning and we can already foresee their growth to be a top local F&B brand in the country.”

Taster grabs $37 million for its native online restaurants

By Romain Dillet

French startup Taster has raised a $37 million Series B funding round from Octopus Venture, Battery Ventures, LocalGlobe, HeartCore, Rakuten, GFC and Founders Future. The company operates dozens of restaurants that only exist on food delivery platforms. You can’t book a table as there is no table.

Taster has been focusing on five street food-inspired concepts so far — Bian Dang (Taiwanese food), A Burgers (plant-based burgers), Mission Saigon (Vietnamese food), Out Fry (Korean food) and Stacksando (Japanese street food). After that, Taster has opened dozens of kitchens across 40 different cities and listed its kitchens on food delivery platforms, such as Deliveroo and Uber Eats.

Essentially, the startup wants to build new restaurant chains for the 21st century. Instead of opening brick-and-mortar restaurants, Taster focuses on food delivery as it’s still a booming segment. In Paris, Taster restaurants are the third restaurant group on Deliveroo behind McDonald’s and Burger King — it represents over 5,000 meals per day.

After operating its own kitchens, Taster now wants to partner with existing restaurants that don’t get a lot of orders on Deliveroo or Uber Eats. Taster brings its own native brands and menus as well as its tech tools.

Taster has built its own delivery app for Android and iOS. But you can still find Taster’s restaurants on third-party platforms. The startup doesn’t want to reinvent the wheel and replace food ordering platforms. But it makes sense to offer its service to end customers directly.

As Taster brands become more and more familiar, it should create demand from day one — restaurants can expect between €4,000 and €6,000 in revenue during the first week. By 2025, Taster wants to operate in 1,000 cities thanks to this partnership model.

Image Credits: Taster

Fraud prevention platform Sift raises $50M at over $1B valuation, eyes acquisitions

By Mary Ann Azevedo

With the increase of digital transacting over the past year, cybercriminals have been having a field day.

In 2020, complaints of suspected internet crime surged by 61%, to 791,790, according to the FBI’s 2020 Internet Crime Report. Those crimes — ranging from personal and corporate data breaches to credit card fraud, phishing and identity theft — cost victims more than $4.2 billion.

For companies like Sift — which aims to predict and prevent fraud online even more quickly than cybercriminals adopt new tactics — that increase in crime also led to an increase in business.

Last year, the San Francisco-based company assessed risk on more than $250 billion in transactions, double from what it did in 2019. The company has over several hundred customers, including Twitter, Airbnb, Twilio, DoorDash, Wayfair and McDonald’s, as well a global data network of 70 billion events per month.

To meet the surge in demand, Sift said today it has raised $50 million in a funding round that values the company at over $1 billion. Insight Partners led the financing, which included participation from Union Square Ventures and Stripes.

While the company would not reveal hard revenue figures, President and CEO Marc Olesen said that business has tripled since he joined the company in June 2018. Sift was founded out of Y Combinator in 2011, and has raised a total of $157 million over its lifetime.

The company’s “Digital Trust & Safety” platform aims to help merchants not only fight all types of internet fraud and abuse, but to also “reduce friction” for legitimate customers. There’s a fine line apparently between looking out for a merchant and upsetting a customer who is legitimately trying to conduct a transaction.

Sift uses machine learning and artificial intelligence to automatically surmise whether an attempted transaction or interaction with a business online is authentic or potentially problematic.

Image Credits:

One of the things the company has discovered is that fraudsters are often not working alone.

“Fraud vectors are no longer siloed. They are highly innovative and often working in concert,” Olesen said. “We’ve uncovered a number of fraud rings.”

Olesen shared a couple of examples of how the company thwarted fraud incidents last year. One recently involved money laundering through donation sites where fraudsters tested stolen debit and credit cards through fake donation sites at guest checkout.

“By making small donations to themselves, they laundered that money and at the same tested the validity of the stolen cards so they could use it on another site with significantly higher purchases,” he said. 

In another case, the company uncovered fraudsters using Telegram, a social media site, to make services available, such as food delivery, with stolen credentials.

The data that Sift has accumulated since its inception helps the company “act as the central nervous system for fraud teams.” Sift says that its models become more intelligent with every customer that it integrates.

Insight Partners Managing Director Jeff Lieberman, who is a Sift board member, said his firm initially invested in Sift in 2016 because even at that time, it was clear that online fraud was “rapidly growing.” It was growing not just in dollar amounts, he said, but in the number of methods cybercriminals used to steal from consumers and businesses.

Sift has a novel approach to fighting fraud that combines massive data sets with machine learning, and it has a track record of proving its value for hundreds of online businesses,” he wrote via email.

When Olesen and the Sift team started the recent process of fundraising, Index actually approached them before they started talking to outside investors “because both the product and business fundamentals are so strong, and the growth opportunity is massive,” Lieberman added.

“With more businesses heavily investing in online channels, nearly every one of them needs a solution that can intelligently weed out fraud while ensuring a seamless experience for the 99% of transactions or actions that are legitimate,” he wrote. 

The company plans to use its new capital primarily to expand its product portfolio and to scale its product, engineering and sales teams.

Sift also recently tapped Eu-Gene Sung — who has worked in financial leadership roles at Integral Ad Science, BSE Global and McCann — to serve as its CFO.

As to whether or not that meant an IPO is in Sift’s future, Olesen said that Sung’s experience of taking companies through a growth phase such as what Sift is experiencing would be valuable. The company is also for the first time looking to potentially do some M&A.

“When we think about expanding our portfolio, it’s really a buy/build partner approach,” Olesen said.

Oxbotica raises $13.8M from Ocado to build autonomous vehicle tech for the online grocer’s logistics network

By Ingrid Lunden

Ocado, the UK online grocer that has been making strides reselling its technology to other grocery companies to help them build and run their own online ordering-and-delivery operations, is making an investment today into what it believes will be the next chapter of how that business will grow: it is taking a £10 million ($13.8 million) stake in Oxbotica, a UK startup that develops autonomous driving systems.

Ocado is treating this as a strategic investment to develop AI-powered, self-driving systems that will work across its operations, from vehicles within and around its packing warehouses through to the last-mile vehicles that deliver grocery orders to people’s homes. It says it expects the first products to come out of this deal — most likely in closed environments like warehouses rather the less structured prospect of open streets — to be online in two years.

“We are not constraining ourselves to work in any one use case,” said Alex Harvey, chief of advanced technology at Ocado, in an interview. But to roll out auotonomous systems everwhere, he added, “we realize there are areas where we will need regulatory compliance,” among other factors. The deal is non-exclusive, and both can work with other partners if they choose, the companies confirmed.

The investment is coming as an extension to Oxbotica’s Series B that it announced in January, bringing the total size of the round — which was led by bp ventures, the investing arm of oil and gas giant bp, and also included BGF, safety equipment maker Halma, pension fund HostPlus, IP Group, Tencent, Venture Science and funds advised by Doxa Partners — to over $60 million. Oxbotica has not disclosed valuation but Paul Newman, co-founder and CTO of Oxbotica, confirmed in an interview that the valuation went up with this latest investment.

The timing of the news is very interesting. It comes just one day (less than 24 hours in fact) after Walmart in the US took a stake in Cruise, another autonomous tech company, as part of recent $2.75B monster round.

Walmart, until February, owned one of Ocado’s big competitors in the UK, ASDA; and Ocado has made its first forays into the US, by way of its deal to power Kroger’s online grocery business, which went live this week, too. So it seems that competition between these two is heating up on the food front.

More generally, there has been a huge surge in the world of online grocery order and delivery services in the last year. Earlier movers like online-only Ocado, Tesco in the UK (which owns both physical stores and online networks), and Instacart in the US have seen record demand, but they have also been joined by a lot of competition from well-capitalized newer entrants also keen to seize that opportunity, and bringing different approaches (next-hour delivery, smaller baskets, specific products) to do so.

In Ocado’s home patch of Europe, other big names looking to extend outside of their home turfs include Oda (formerly Kolonial); Rohlik out of the Czech Republic (which in March bagged $230 million in funding); Everli out of Italy (formerly called Supermercato24, it raised $100 million); Picnic out of the Netherlands (which has yet to announce any recent funding but it feels like it’s only a matter of time given it too has publicly laid out international ambitions). Even Ocado has raised huge amounts of money to pursue its own international ambitions. And that’s before you consider the nearly dozens of next-hour, smaller bag grocery delivery plays.

A lot of these companies will have had a big year last year, not least because of the pandemic and how it drove many people to stay at home, and stay away from places where they might catch and spread the Covid-19 virus.

But now, the big question will be how that market will look in the future as peoples go back to “normal” life.

As we pointed out earlier this week, Ocado has already laid out how demand is lower, although still higher than pre-pandemic times. And indeed, the new-new normal (if we can call it that) may well see the competitive landscape tighten some more.

That  could also be one reason why companies like Ocado are putting more money into working on what might be the next generation of services: one more efficient and run purely (or at least mostly) on technology.

The rationale of forking out big for autonomous tech, which is still largely untested and very, very expensive technology, to save money is a long-term play. Logistics today accounts for some 10% of the total cost of a grocery delivery operation. But that figure goes up when there is peak demand or anything that disrupts regularly scheduled services.

My guess is also that with all of the subsidized services that are flying about right now, where you see free deliveries or discounts on groceries to encourage new business — a result of the market getting so competitive — those logistics have bled into being an even bigger cost.

So it’s no surprise to see the biggest players in this space looking at ways that it might leverage advances in technology to cut those costs and speed up how those operations work, even if it’s just a promise of discounts in years, not weeks. Of course investors might see it otherwise if that doesn’t go to plan.

In addition to this collaboration with Oxbotica, Ocado said it will be looking to make more investments and/or partnerships as it grows and develops its autonomous vehicle capabilities. While this is the company’s first investment into Oxbotica, it has made a number of investments into other startups, and collaborated to work on the next stage of technology. This has included research to build a robotic arm — which robotic pickers is something it will be introducing soon — as well as the recent acquisition of two robotics companies, Kindred and Haddington, for $262 million; and investments in robotics startups Karakuri and Myrmex, and more,

Notably, Oxbotica and Ocado are not strangers. They started to work together on a delivery pilot back in 2017. You can see a video of how that delivery service looks here:

“This is an excellent opportunity for Oxbotica and Ocado to strengthen our partnership, sharing our vision for the future of autonomy,” said Newman, in a statement. “By combining both companies’ cutting-edge knowledge and resources, we hope to bring our Universal Autonomy vision to life and continue to solve some of the world’s most complex autonomy challenges.”

But as with all self-driving technology — incredibly complex and full of regulatory and safety hurdles — we are still fairly far from full commercial systems that actually remove people from the equation completely.

“For both regulatory and complexity reasons, Ocado expects that the development of vehicles that operate in low-speed urban areas or in restricted access areas, such as inside its CFC buildings or within its CFC yards, may become a reality sooner than fully-autonomous deliveries to consumers’ homes,” Ocado notes in its statement on the deal. “However, all aspects of autonomous vehicle development will be within the scope of this collaboration. Ocado expects to see the first prototypes of some early use cases for autonomous vehicles within two years.”

Newman noted that while on-street self-driving might still be some years away, it’s less of a moonshot concept today than it used to be, and that Oxbotica is on the road to it already. “You can get to the moon in stages,” he said.

Updated with interviews with both companies, and to correct that Walmart closed its deal to sell ASDA in February.

Grab to go public in the US following $40 billion SPAC deal

By Romain Dillet

Ride-hailing and delivery company Grab has announced plans to go public in the U.S. Based in Singapore, the company has evolved from a ride-hailing app to a Southeast Asian super app that offers several consumer services, including food delivery, financial services, such as an e-wallet so that you can send and receive money.

It operates in Singapore, Malaysia, Cambodia, Indonesia, Myanmar, Philippines, Thailand and Vietnam. According to Crunchbase, the company has raised over $10 billion, including from SoftBank’s Vision Fund.

In order to go public, Grab has chosen to merge with a SPAC named Altimeter Growth Corp. A SPAC is a publicly-traded blank-check company based in the U.S. Going public through this process should be much easier for Grab — especially because it’s a foreign company.

If the deal goes through, it would be the world’s largest SPAC merger. Grab would be listed on NASDAQ under the symbol ‘GRAB’.

A part of the announcement, Grab has shared some metrics and some big numbers. In 2020, the company managed to generate around $12.5 billion in gross merchandise value (GMV). The merger would value Grab at $39.6 billion and the company would keep $4.5 billion in cash.

The company thinks there’s still a lot of room to grow when it comes to food delivery and on-demand mobility in Southeast Asia. It expects to see the total addressable market jump from $52 billion to $180 billion by 2025.

“This is a milestone in our journey to open up access for everyone to benefit from the digital economy. This is even more critical as our region recovers from COVID-19. It was very challenging for us too, but it taught us immensely about the resiliency of our business,” Grab co-founder and CEO Anthony Tan said in the announcement.

“Our diversified superapp strategy helped our driver-partners pivot to deliveries, and enabled us to deliver growth while improving profitability. As we become a publicly-traded company, we’ll work even harder to create economic empowerment for our communities, because when Southeast Asia succeeds, Grab succeeds,” he added.

Altimeter has agreed to a three-year lockup period for its sponsor shares, which means that Altimeter should remain committed to the company for a while.

Domino’s, Nuro to begin autonomous pizza deliveries in Houston

By Rebecca Bellan

Starting this week, some Domino’s customers in Houston can have a pizza delivered without ever interacting with a human.

The pizza delivery giant said Monday it has partnered with autonomous delivery vehicle startup Nuro to allow select customers to have their pizzas dropped at their door via Nuro’s R2 robot.

“There is still so much for our brand to learn about the autonomous delivery space,” Dennis Maloney, Domino’s senior vice president and chief innovation officer said in a statement. “This program will allow us to better understand how customers respond to the deliveries, how they interact with the robot and how it affects store operations.”

On certain days and times, customers ordering from the Woodland Heights store on the Domino’s website can request R2, which uses radar, 360-degree cameras and thermal imaging to direct its movement. They’ll get texts to let them know where the robot is and what PIN they’ll need to access their pizza via the bot’s touchscreen.

Over the course of the pandemic, the contactless, autonomous food delivery industry has accelerated quickly, and Nuro is currently poised to become a leader in this space.

“Nuro’s mission is to better everyday life through robotics,” Dave Ferguson, Nuro co-founder and president, said in a statement. “We’re excited to introduce our autonomous delivery bots to a select set of Domino’s customers in Houston. We can’t wait to see what they think.”

This is the first time meals will be delivered by an electric, self-driving, occupant-less vehicle on the roads in Houston. Woodland Heights, which is mainly residential, is one of the oldest historic neighborhoods in Houston, flanked by the I-45 and I-10 highways. The Domino’s there is right on Houston Avenue, a main thoroughfare, making this a substantially challenging space in which to pilot this technology.

Nuro originally announced the Domino’s partnership and began testing in Houston in 2019. That same year, the company began deploying its vehicles to transport Kroger groceries in Houston and Phoenix. At the end of 2020, it was approved to begin testing on public roads in California, delivering goods from partners like Walmart and CVS. Nuro is the first company to be granted regulatory approval by the U.S. Department of Transportation for a self-driving vehicle exemption.

Domino’s appears to be Nuro’s first large foray into restaurant delivery, but it certainly won’t be the last. The company just announced its $500 million Series C round, funded in part by Chipotle. Woven Capital, the investment arm of Toyota’s innovation-focused subsidiary Woven Planet, also invested, kicking off the fund’s portfolio.

Elior acquires food delivery startup Nestor

By Romain Dillet

Corporate catering company Elior has acquired French startup Nestor for an undisclosed amount. Nestor originally started with a simple idea to differentiate itself from food delivery giants, such as Deliveroo, Uber Eats and others.

Every day, the startup offered a single menu for lunch. If you liked what was on the menu, you could order and get delivered 10 to 20 minutes later. By offering a single menu, a delivery person could deliver several clients in a single ride. Similarly, by managing its own kitchen, Nestor could improve its margins as it didn’t have to pay third-party restaurants.

Since I first covered Nestor in 2016, the company has been capital efficient and mostly focused on this unique product offering. Elior says that Nestor managed to reach 10,000 meals per week.

Over the past few months, Nestor has tried to launch new offers. For instance, companies can switch to Nestor for their canteens. The startup delivers meals in fridges directly. It reminds me of Foodles, another French startup focused on canteen-like services.

Nestor can also deliver individually packed lunches in case you are spending the day with some clients for a big meeting. Popchef has also pivoted to focus more on that segment.

Following the acquisition, Nestor is going to focus more and more on the B2B market. While Elior is working with big companies in glass towers, it has been quite hard to convince small and medium companies to open a canteen in the office.

The sales pitch could be summed up in two sentences. Nestor clients don’t need to have their own kitchen as everything is prepared in advance. And employees don’t have to browse Deliveroo at lunch time to find something that isn’t a burger or a pizza.

Norwegian corporate training startup Attensi raises $26M from NYC’s Lugard Road, DX Ventures

By Mike Butcher

Corporate training startup Attensi — which originally emerged out of Oslo, Norway — has raised $26 million from New York-based Lugard Road Capital, DX Ventures (a VC fund backed by Delivery Hero), and existing shareholder Viking Venture. The new funding will be used to expand in North America and Europe.

Attensi uses a ‘gamified approach to corporate training, putting employees into 3D simulations of their workplace and work processes. Its competitors include companies like GoSkills, Mindflash SAP Litmos Skilljar.

With the pandemic shifting all office work to remote, digital training platforms like this stand to benefit.

This is also yet another recent example of how US VCs are ‘going hunting’ for startups in Europe, putting pressure on local VCs.

Attensi co-founder and co-CEO, Trond Aas said in a statement: “With gamified simulation training, we have combined the best of workplace psychology with our expertise in simulations and gamification to create a new category of training solutions.”

The company claims it’s experienced a 63% CAGR in annual recurring revenue. Its clients include Daimler Mercedes Benz, Circle K, Equinor, BCG, and ASDA.

Doug Friedman, a partner at Lugard Road Capital, said: “We could not be more excited to be investing in the Attensi team as they work to forever change and improve corporate learning and development through their Attensi solutions.”

Norway’s Kolonial rebrands as Oda, bags $265M on a $900M valuation to grow its online grocery delivery business in Europe

By Ingrid Lunden

Food delivery startups, and specifically those focused on grocery delivery, continue to reap super-sized rounds of funding in Europe, buoyed by a year of pandemic living that has led many consumers to shift to shopping online. Today, the latest of these is coming out of Norway.

Kolonial, a startup based out of Oslo that offers same-day or next-day delivery of food, meal kits and home essentials — its aim is to provide “a weekly shop” for prices that compete against those of traditional supermarkets — has raised €223 million ($265 million) in an equity round of funding. Along with that, the company — profitable as of last year — is rebranding to Oda and plans to use the money (and new name) to expand to more markets, starting first with Finland and then Germany in 2022.

The market for online grocery ordering and delivery is gearing up to be a very crowded one, with hundreds of millions of dollars being poured by investors into the fuel tanks of a range of startups — each originating out of different geographies, each with a slightly different approach. Oda believes it has the right mix to end up at the front of the pack.

“We have found ourselves in a unique position,” CEO and co-founder Karl Munthe-Kaas said in an interview with TechCrunch. “We have built a service targeting the mass market with instant deliveries and low prices, because if you want to capture the full basket for the family, you can’t be a premium service. We’ve done that, and we’re profitable.”

And now, it will have the backing of two e-commerce heavyweights for its next steps. SoftBank’s Vision Fund 2 and Prosus (the tech holdings of South Africa’s Naspers), are co-leading the round, with past backers Kinnevik and a strategic investor, Norwegian “soft discount” chain REMA, also participating.

Munthe-Kaas confirmed to TechCrunch in an interview that Oda is valued at €750 million ($900 million) post-money.

The funding is a big leap for Oda (the name is not officially going to come into effect until the end of this month, although the company is already describing itself with the new brand, so we’ll follow that lead). PitchBook data notes that before this round, Oda had only raised about $96 million, and its last valuation was estimated to be just $178 million in 2017.

The company has certainly come a long way. Founded in 2013 by ten friends, Kolonial originally seemed to have a more modest vision when it first started out: Kolonial in Norwegian doesn’t mean “colonial” (a connotation Munthe-Kaas nevertheless said the startup wanted to avoid, one big reason for the change), but “cornershop.” These days, Oda is focused more on competing against large supermarkets — its average order size is $120 — yet with a significantly more efficient cost base behind the scenes.

It’s also been helped by the current climate. Online grocery shopping has been growing and maturing for a while now, but the last year been a veritable hothouse in that process: Covid-19, shelter in place orders and a general desire for people to keep their distance all compelled many more consumers to try out online grocery shopping for the first time, and many have stuck with it.

“We have seen a significant inflection point with grocery over the last year with the market transitioning online, accelerated by Covid,” said Larry Illg, CEO of Prosus Food, in a statement. “Oda’s leadership and impressive growth in Norway paired with its ground-breaking technology and ambition to scale across Europe and beyond makes them an ideal partner to tackle the grocery opportunity over the coming years.”

Oda has over the years grown to become the sector leader in a category it arguably helped define in its home country. It was profitable last year on revenues of €200 million, and it currently controls some 70% of Norway’s online grocery ordering and delivery market based on its own particular approach to the model.

That model involves Oda building and controlling its own supply chains from producers to consumers (no partnerships with third y partphysical retailers), producing several of the products itself (such as baked goods) to order, and using centralized fulfillment centers to manage orders for large geographies.

“Centralized warehouses means 50 supermarkets in one location,” Munthe-Kaas said, adding that this also makes the business significantly greener, too.

Those fulfillment centers, meanwhile, are operated at “extreme efficiency”, in his words. Oda’s grocery item picking averages out at 212 units per hour — that is, the amount of items “picked” for orders in a week divided by the number of hours in a week. The next closest UPH number in the industry, Munthe-Kaas said, was Ocado in the UK at 170 UPH, and the norm, he added, was more like 100 UPH, with physical store picking (where customers select items from shelves themselves) averaging out at 70 UPH.

All of this translates to much more cost-effective operations, including more efficient ordering and stock rotation, which helps Oda make better margins on its sales overall. Munthe-Kaas declined to go into the details of how Oda manages to get such high UPH numbers — that’s competitive knowledge, he said — noting only that a lot of automation and data analytics goes into the process.

That will be music to the ears of SoftBank, which has had a complicated run in e-commerce in the last several years, backing a number of interesting juggernauts that have nonetheless found themselves unable to improve on challenging unit economics.

“Oda’s leading position in Norway is testament to the merits of its bespoke and data-driven approach in offering a personalised, holistic and reliable online grocery experience,” said Munish Varma, managing partner for SoftBank Investment Advisers, in a statement. “We believe that Oda’s customer-centric focus, market-leading automation technology and fulfillment efficiency are a winning combination, and position Oda for success in scaling internationally for the benefit of customers and suppliers alike.”   

The big challenge for Oda going forward will be whether it can transplant its business model as it has been developed for Norway into further markets.

Oda will not only be looking for customer traction for its own business, but it will be doing so potentially against heavy competition from others also looking to expand outside their borders.

There are other online supermarket plays like Rohlik out of the Czech Republic (which in March bagged $230 million in funding); Everli out of Italy (formerly called Supermercato24, it also raised $100 million); Picnic out of the Netherlands (which has yet to announce any recent funding but it feels like it’s only a matter of time given it too has publicly laid out international ambitions); and Ocado in the UK (which also has raised huge amounts of money to pursue its own international ambitions).

And there is also the wave of companies that are building more fleet-of-foot approaches around smaller inventories and much faster turnaround times, the idea being that this can cater both to individuals and a different way of shopping — smaller and more often — even if you are a family.

Among these so-called “q-commerce” (quick commerce) players, covering just some of the most recent funding rounds, Glovo just last week raised $528 million; Gorillas in Berlin raised $290 million; Turkey’s Getir — also rapidly expanding across Europe — picked up $300 million on a $2.6 billion valuation as Sequoia took its first bite into the European food market; and reportedly Zapp in London has also closed $100 million in funding.

Deliveroo, which went public last week, is also now delivering groceries (in partnership with Sainsbury’s) alongside its restaurant delivery service.

These, ironically, are more cornershop replacements than Oda itself (formerly called Kolonia, or “cornershop” in Norwegian), and Munthe-Kaas said he sees them as “complementary” to what Oda does.

Indeed, Munthe-Kaas remains very committed to the basic rulebook that Oda has lived by for years.

“You need to beat the physical stores on quality, selection and price and get it home delivered,” he said. “This is a margin business and the only way to optimize is to be completely relentless.”

But he also understands that this might ultimately need to be modified depending on the market. For example, while the company has not worked with other retailers in Norway — even the investment by REMA is not for distribution but for better economies of scale in procuring products that REMA and Oda will sell independently from each other — this might be a route that Oda chooses to take in other markets.

“We’re in discussions with several other retailers, wholesalers and producers,” he said. “It’s important to get sourcing terms and have upstream logistics, but there are many ways of achieving that. We are super open to making partnerships on that front, but we still think the way to win is to run the value chain.”

Starship Technologies CEO/CTO Ahti Heinla joins TC Sessions: Mobility 2021

By Brian Heater

For obvious reasons, food delivery was among the categories that soared during a year of Covid-19 related lockdowns. The question remains how these changes will impact both grocery and restaurant delivery long-term, but at the very least, it seems certain that the categories have hit an inflection point.

This could also be the moment that delivery robotics finally come into their own, as more services look beyond human messengers to plan for future pandemics and other potential issues.

It’s a moment Starship Technologies has been planning for since 2014. With around $100 million of funding under its belt, the company has already been testing its delivery robots in a number of different real-world markets. In January, it added another $17 million in funding to continue growing impressive growth that includes a five-fold increase in its fleet size since the beginning of the pandemic.

The company’s co-founder and CEO/CTO Ahti Heinla will join us at TC Sessions: Mobility 2021 to discuss Starship’s role in the push for last-mile robotic delivery. It’s been a long road for the startup, and there’s still a ways to go, in dealing with everything from technology to regulatory red tape. We’ll discuss these challenges and whether the on-going pandemic will be the push these technologies need to become a more mainstream reality.

By late summer 2021, Starship Technologies plans to expand to 100 universities  – leaping from the 15 campuses it operated from at the beginning of this year. Not only that, but Starship Technology is growing in just about every meaningful way for startups, including delivery locations, number of deliveries, fleet size and workforce, which now is about 400 strong.

We can’t wait to hear from Ahti and more mobility-industry leaders at TC Sessions: Mobility on June 9. Make sure to grab your Early Bird pass before May 6 to save 35% on tickets and join the fun!

Spain’s Glovo picks up $528M as Europe’s food delivery market continues to heat up

By Ingrid Lunden

On the heels of Deliveroo raising more than $2 billion ahead of its debut on the London Stock Exchange this week, another hopeful in the food delivery sector has closed a super-sized round. Glovo, a startup out of Spain with 10 million users that delivers restaurant take-out, groceries and other items in partnership with brick-and-mortar businesses, has picked up a Series F of $528 million (€450 million).

Glovo aims to become the market leader in the 20 markets in Europe where it is live today, in part by expanding its “q-commerce” service — the delivery of items to urban consumers in 30 minutes or less — and it will be using the money to double down on that strategy, including hiring up to 200 more engineers to work in its headquarters in Barcelona, as well as hubs in Madrid and Warsaw, Poland.

This is a milestone funding round not just for the company, but its home country: it marks the largest-ever round raised by a Spanish startup.

“We started in Spain, where you have access to far less capital than other countries in Europe. We do more with less and that’s made us leaner,” said Sacha Michaud, the co-founder of the company, in an interview this week. “We’ve got our own strategy and it seems to be working.”

The funding is being led by Lugard Road Capital and Luxor Capital Group (the former is an affiliate of the latter), with Delivery Hero, Drake Enterprises and GP Bullhound also participating. All are previous backers of Glovo.

“We’re thrilled to have the continued backing of Luxor Capital Group and all of our existing investors. Over the last few months, we’ve moved very, very quickly but our vision remains unchanged,” said Oscar Pierre, Glovo’s other co-founder and CEO, in a statement. “This investment will allow us to double-down in our core markets, accelerate our leadership position in places where we are already very strong and continue to expand our excellent Q-Commerce division, as well as bring new innovations to our unique multi-category offering to extend more choice to our customers.”

Valuation is not being disclosed with this round, but when it raised its $166 million Series E in December 2019 — just ahead of the Covid-19 pandemic that truly changed the face of delivery services in many parts of the world — the company had a valuation of $1.18 billion, according to PitchBook data. Michaud would only confirm to me that it was “definitely an up-round,” which would put it at at least $1.7 billion, based on that estimate.

The funding comes on the heels of a very busy period of fundraising in the sector as investors the race to get in on the delivery of hot food, groceries and other necessities in Europe — a fast-growing business model in the most normal of times that blasted off in the last year as an essential service for consumers confined to their homes, often by government mandate, to stave off the spread of the coronavirus.

Just in the last week, Gorillas in Berlin raised $290 million on a $1 billion+ valuation for its on-demand grocery business; Everli out of Italy (formerly called Supermercato24) raised $100 million (Luxor is one of its investors too); Turkey’s Getir — also rapidly expanding across Europe — picked up $300 million on a $2.6 billion valuation as Sequoia took its first bite into the European food market; and reportedly Zapp in London has also closed $100 million in funding. Earlier in March, Rohlik out of the Czech Republic bagged $230 million.

Amid all those private raises, we also had Deliveroo’s IPO yesterday, which — as IPOs so often do — exposed some of the trickier aspects of the business. The company — which is backed by Amazon, a formidable player in food and essentials delivery — easily raised the most of money of the month — $2.1 billion in the private placement ahead of the listing — but then proceeded to slog out its debut on the LSE with shares progressively slumping throughout the day and ending up significantly lower than its offer price.

Areas of concern around Deliveroo serve as cautionary tales for all of them: not just how you price an IPO and what allocation you give to future shareholders, but also the unit economics of your business model, the price of competition, and where labor costs will fit into the bigger picture (and the bottom line).

“We’ve got our own road and we’re doing a pretty good job,” Michaud said in an interview when the subject of Deliveroo IPO came up. “We’re still David versus the Goliath out there.” Part of that for Glovo has also included some decisions made on rationalizing its own business: the company sold off its Latin American operations in a $272 million deal to its backer Delivery Hero last year to focus solely on Europe and adjacent geographies.

But even before the Series F being announced today, Glovo itself was one of the companies raising money for specific purposes, and those efforts point to how it plans to proceed in the weeks and months ahead on its own growth plan.

In January Glovo announced a strategic deal with Swiss real-estate firm Stoneweg, which pitched in €100 million ($117 million), to co-develop a number of “dark stores” in areas where Glovo already operates to improve its distribution networks and help speed up its delivery times.

It’s part of a fulfillment operation that complements the hot food that Glovo sells on behalf of its restaurant partners: the dark stores are stocked with items Glovo sells on behalf of other companies such as Carrefour, Continente, and Kaufland, as well as a lot of independent retailers, companies that have not built their own (costly) B2C delivery networks but have wanted to provide that service to consumers nonetheless.

Although the company today promises deliveries in 29 minutes, in many markets, Michaud said, it’s already averaging 10-15 minutes and the aim is to make that the norm everywhere. This is in part an operational challenge, but also a technical one: this is one reason why the company is adding in more engineers and building out its platform.

Restaurant delivery of hot food remains the biggest category of business for Glovo, he added, but the company has seen a surge of demand for the other kinds of items and is expanding that accordingly.

“With Covid, we’ve been delivering pretty much anything you want in your city,” Michaud said. “Covid has been an accelerator and has educated the market. Instead of crossing city and spending time waiting and buying items, anything I want and Glovo will bring it to me. Why wouldn’t I do this?” He believes the more traditional rush of people doing in-person shopping is “definitely not gong to come back,” with groceries to be in the same position as restaurants in a couple of years. That’s leading the company to expand into more areas: “clothing, fashion and pharmacy, flowers. Hopefully we’re now in a good position to do that.”

Labor deliberations

That position, of course, will involve an important component of this three-sided marketplace. In addition to the restaurants and retailers that partner with Glovo, and the consumers who use the app to buy and get things delivered, there are the delivery people and couriers that do the first- and last-mile work to get the goods into the system, and then to customers. The couriers in the system work today largely on a freelance basis, often balancing jobs on competing apps, and their efforts, and how they are compensated for them, have been the focus of a lot of scrutiny both here and in the U.S.

In short: the companies say couriers have an amazing opportunity to earn money; but many couriers and organizations supporting their cause believe the reality to be far from that.

That has played out with a number of very public protests and is starting now to trickle into formal legal moves to ensure these workers’ rights. Apart from the ethical angle here, it’s of concern also to investors focused more on the bottom line and the costs that they might mean for businesses that already work on thin margins (or in many cases, losses). Indeed, it’s very likely that these issues formed part of what weighed on Deliveroo in its public listing and poor debut.

This has also been playing out for Glovo very directly. The company lost a supreme court case in Spain in September last year, where the court rejected its attempt to classify a courier as self-employed rather than an employee. Now, the country is working on more formal reforms to put in place guidelines and requirements for companies to mandate benefits to those workers. That will take some time to play out, and in the meantime there are also wider European efforts underway to harmonize the approach across all countries in the EU.

This is a complicated issue, but essentially Glovo advocates to keep the couriers as self-employed, but supports the idea of benefits provided to those workers nonetheless by those taking their services (such as Glovo), and it wants the approach to be Europe-wide.

“We think there needs to be more social rights for workers,” Michaud said. “We believe in a freelance model with additional social rights that companies like Glovo would give them, but in many countries the regulations are not there for that to happen.”

But it’s also not all cut-and-dry since it doesn’t support some of the other aspects of that labor reform. “We think the rigid strict tables and minimum wages are not the way to fix the problem,” he added, explaining that the flexibility of the business model does not support that. In short, it’s negotiating and hoping that it can claw in some expenses while conceding others.

Investors seem ready for these kinds of questions and their longer-term impact, given that the trade-off for them is a foothold in what has been one of the most successful tech efforts in the region.

“Our investment in Glovo reflects our commitment to a company and leadership team that continues to innovate and disrupt in the on-demand delivery space,” said Jonathan Green, founder and porfolio manager at Lugard Road Capital, in a statement. “As a long-term investor in Glovo, we are excited to watch the company continue to delight its customers through its unique multi-category offering, amidst an enormous market opportunity in both existing and new geographies.”

ABB and AWS team up to create an EV fleet management platform

By Rebecca Bellan

Swiss automation and technology company ABB has announced a collaboration with Amazon Web Services (AWS) to create a cloud-based EV fleet management platform that it hopes will hasten the electrification of fleets. The platform, which the company says will help operators maintain business continuity as they switch to electric, will roll out in the second half of 2021.

This announcement comes after a wave of major delivery companies pledged to electrify their fleets. Amazon already has a number of Rivian-sourced electric delivery vans on the streets of California and plans to have 10,000 more operational by this year; UPS ordered 10,000 electric vans from Arrival for its fleet; 20% of DHL’s fleet is already electric; and FedEx plans to electrify its entire fleet by 2040. A 2020 McKinsey report predicted commercial and passenger fleets in the U.S. could include as many as eight million EVs by 2030, compared with fewer than 5,000 in 2018. That’s about 10 to 15% of all fleet vehicles.

“We want to make EV adoption easier and more scalable for fleets,” Frank Muehlon, president of ABB’s e-mobility division, told TechCrunch. “To power progress, the industry must bring together the best minds and adopt an entrepreneurial approach to product development.” 

ABB brings experience in e-mobility solutions, energy management and charging technology to the table, which will combine with AWS’s cloud and software to make a single-view platform that can be tailored to whichever company is using it. Companies will be able to monitor things like charge planning, EV maintenance status, and route optimization based on the time of day, weather and use patterns. Muehlon said they’ll work with customers to explore ways to use existing data from fleets for faster implementation.

The platform will be hosted on the AWS cloud, which means that it can scale anywhere AWS is available, which so far includes in 25 regions globally.

The platform will be hardware-agnostic, meaning any type of EV or charger can work with it. Integration of software into specific EV fleets will depend on the fleet’s level of access to third-party asset management systems and onboard EV telematics, but the platform will support a layered feature approach, wherein each layer provides more accurate vehicle data. Muehlon says this makes for a more seamless interface than existing third-party charging management software, which don’t have the technology or the flexibility to work with the total breadth of EV models and charging infrastructure. 

“Not only do fleet managers have to contend with the speed of development in charging technology, but they also need real-time vehicle and charging status information, access to charging infrastructures and information for hands-on maintenance,” said Muehlon. “This new real-time EV fleet management solution will set new standards in the world of electric mobility for global fleet operators and help them realize improved operations.”

This software is aimed at depot and commercial fleets, as well as public infrastructure fleets. Muehlon declined to specify any specific EV operators or customers lined up to use this new technology, but he did say there are “several pilots underway” which will “enable us to ensure that we are developing market-ready solutions for all kinds of fleets.” 

Gorillas, the on-demand grocery delivery startup, raises $290M and ‘surpasses’ $1B valuation

By Steve O'Hear

Gorillas, the Berlin-HQ’d startup that promises to let you order groceries and other “every day” items for delivery in as little as 10 minutes, has raised $290 million in Series B funding, at a valuation that surpasses $1 billion.

The round — which was first reported by BI — is led by Coatue Management, DST Global and Tencent, with participation from Green Oaks, Fifth Wall and Dragoneer. Previous backer Atlantic Food Labs also followed on.

Noteworthy, Gorillas CEO and co-founder Kağan Sümer tells TechCrunch the round is “100% equity” (i.e. without a debt component). Asked if it includes any secondary funding — seeing existing shareholders liquidate a portion of their shares — Gorillas declined to comment.

Having become one of the fastest European startups to have achieved so-called “unicorn” status — a valuation of $1 billion or more — Gorillas says it will reward its rider crew and warehouse staff with $1 million in bonuses. However, the company isn’t disclosing how this one-off bonus breaks down per worker, and it isn’t clear if the bonus is cash or stock or a mixture of both. The move comes at a time when Gorillas riders in Germany are reportedly organising to unionise.

“In contrast to established gig economy models, we employ more than a thousand riders directly,” says Sümer. “Therefore, we invest in a strong career development program, rider security and a healthy working environment. Beyond that, all riders will receive a once-off payment”.

Founded last May by Kağan Sümer and Jörg Kattner in Berlin, Gorillas has already expanded to more than 12 cities, including Amsterdam, London and Munich. The company lets you order groceries and other household items on-demand with an average delivery time of 10 minutes.

To do this, it operates a vertical or “dark store” model, seeing it set up its own micro fulfillment centers, which currently total 40, spread across Germany, the U.K. and the Netherlands. Customers are charged just over $2 per delivery and can order from “more than 2,000 essential items at retail prices”.

“We believe that the weekly grocery run is outdated because people’s lives are increasingly spontaneous and shopping habits change accordingly,” says Sümer, noting that while access to supermarkets has increased, the space we have to store goods has decreased as people in cities are living in smaller spaces.

“Additionally, this pandemic has accelerated the need for grocery deliveries. If we can order clothes and trinkets and have them delivered to our door, the same should be said for our essential needs. Gorillas helps customers get what they need when they need it, whether this is their weekly grocery list or the tomatoes they forgot for tonight’s pasta recipe”.

Sümer says the service initially attracted typical early adopters because it was a radically new experience and the app was only available in English. He claims that Gorillas has since gained a “very broad” base of users that are “extremely loyal”. “With geographical expansion and the rapid increase of word-of-mouth, we now cater to pretty much anyone you’d meet in a supermarket,” he says.

Asked to share what a typical basket looks like, and therefore what kind of existing grocery habits Gorillas is displacing, Sümer says that users increase their basket size over time as they gain trust in the service and its products. “Simultaneously, customers are integrating an increasing share of their typical supermarket purchases within their Gorillas orders. This includes fresh goods like fruit and vegetables, as well as products of local suppliers”.

Meanwhile, dark store competition in cities like London — where Gorillas recently expanded and counts as a key market — continues to ramp up. This is seeing operators issue vouchers and offer sizeable discounts in a bid to acquire customers fast, while VCs are pumping huge amounts of early-stage cash into a space where unit economics aren’t yet definitively proven.

Earlier this month, Berlin-based Flink announced that it had raised $52 million in seed financing in a mixture of equity and debt. The company didn’t break out the equity-debt split, though one source told me the equity component was roughly half and half.

Others in the space include London’s Jiffy, Dija and Weezy, and France’s Cajoo. There’s also London-based Zapp, which remains in stealth, and heavily backed Getir, which started in Turkey but recently also came to London.

Meanwhile, U.S.-founded goPuff — which this week raised another $1.15 billion in funding at a whopping $8.9 billion valuation (compared to $3.9 billion in October) — is also looking to expand into Europe and has held talks to acquire or invest in the U.K.’s Fancy.

These Rare Seeds Escaped Syria's War—to Help Feed the World

By Matt Simon
Conflict forced scientists to abandon a gene bank, but not before duplicating their last remnants of essential crops in the Svalbard vault on a remote Arctic island.
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