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Singapore’s Grain, a profitable food delivery startup, pulls in $10M for expansion

Posted by on May 10, 2019 in Asia, bangkok, Cento Ventures, ceo, Deliveroo, Food, food delivery, Foodpanda, funding, Fundings & Exits, grain, Honestbee, Impossible foods, munchery, online food ordering, openspace ventures, Singapore, Southeast Asia, Spotify, Startup company, TC, Thailand, transport, Travis Kalanick, Uber, United States, websites, world wide web | 0 comments

Cloud kitchens are the big thing in food delivery, with ex-Uber CEO Travis Kalanick’s new business one contender in that space, with Asia, and particularly Southeast Asia, a major focus. Despite the newcomers, a more established startup from Singapore has raised a large bowl of cash to go after regional expansion.

Founded in 2014, Grain specializes in clean food while it takes a different approach to Kalanick’s CloudKitchens or food delivery services like Deliveroo, FoodPanda or GrabFood.

It adopted a cloud kitchen model — utilizing unwanted real estate as kitchens, with delivery services for output — but used it for its own operations. So while CloudKitchens and others rent their space to F&B companies as a cheaper way to make food for their on-demand delivery customers, Grain works with its own chefs, menu and delivery team. A so-called ‘full stack’ model if you can stand the cliched tech phrase.

Finally, Grain is also profitable. The new round has it shooting for growth — more on that below — but the startup was profitable last year, CEO and co-founder Yi Sung Yong told TechCrunch.

Now it is reaping the rewards of a model that keeps it in control of its product, unlike others that are complicated by a chain that includes the restaurant and a delivery person.

We previously wrote about Grain when it raised a $1.7 million Series A back in 2016 and today it announced a $10 million Series B which is led by Thailand’s Singha Ventures, the VC arm of the beer brand. A bevy of other investors took part, including Genesis Alternative Ventures, Sass Corp, K2 Global — run by serial investor Ozi Amanat who has backed Impossible Foods, Spotify and Uber among others — FoodXervices and Majuven. Existing investors Openspace Ventures, Raging Bull — from Thai Express founder Ivan Lee — and Cento Ventures participated.

The round includes venture debt, as well as equity, and it is worth noting that the family office of the owners of The Coffee Bean & Tea Leaf — Sassoon Investment Corporation — was involved.

Grain covers individual food as well as buffets in Singapore

Three years is a long gap between the two deals — Openspace and Cento have even rebranded during the intervening period — and the ride has been an eventful one. During those years, Sung said the business had come close to running out of capital before it doubled down on the fundamentals before the precarious runway capital ran out.

In fact, he said, the company — which now has over 100 staff — was fully prepared to self-sustain.

“We didn’t think of raising a Series B,” he explained in an interview. “Instead, we focused on the business and getting profitable… we thought that we can’t depend entirely on investors.”

And, ladies and gentleman, the irony of that is that VCs very much like a business that can self-sustain — it shows a model is proven — and investing in a startup that doesn’t need capital can be attractive.

Ultimately, though, profitability is seen as sexy today — particularly in the meal space where countless U.S. startups has shuttered including Munchery and Sprig — but the focus meant that Grain had to shelve its expansion plans. It then went through soul-searching times in 2017 when a spoilt curry saw 20 customers get food poisoning.

Sung declined to comment directly on that incident, but he said that company today has developed the “infrastructure” to scale its business across the board, and that very much includes quality control.

Grain co-founder and CEO Yi Sung Yong [Image via LinkedIn]

Grain currently delivers “thousands” of meals per day in Singapore, its sole market, with eight-figures in sales per year, he said. Last year, growth was 200 percent, Sung continued, and now is the time to look overseas. With Singha, the Grain CEO said the company has “everything we need to launch in Bangkok.”

Thailand — which Malaysia-based rival Dahamakan picked for its first expansion — is the only new launch on the table, but Sung said that could change.

“If things move faster, we’ll expand to more cities, maybe one per year,” he said. “But we need to get our brand, our food and our service right first.”

One part of that may be securing better deals for raw ingredients and food from suppliers. Grain is expanding its ‘hub’ kitchens — outposts placed strategically around town to serve customers faster — and growing its fleet of trucks, which are retrofitted with warmers and chillers for deliveries to customers.

Grain’s journey is proof that startups in the region will go through trials and tribulations, but being able to bolt down the fundamentals and reduce burn rate is crucial in the event that things go awry. Just look to grocery startup Honestbee, also based in Singapore, for evidence of what happens when costs are allowed to pile up.


Source: The Tech Crunch

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VCs have growing appetite for ‘AgriFood’

Posted by on Mar 7, 2019 in AgFunder, agriculture, agriculture tech, AgTech, Asia, Biotech, CrunchBase, economy, entrepreneurship, farming, Finance, Food, food delivery, food tech, funding, GreenTech, groceries, grocery, McKinsey, money, Naspers, Private Equity, restaurant tech, Restaurants, Softbank, Startup company, Startups, TC, Venture Capital, Zume Pizza | 0 comments

Venture investors are pouring billions of dollars into feeding their hunger for food and agriculture startups. Whether that trend line is due to enthusiasm for the sector or just broader heavy investing in the VC space is much less clear.

According to a recent report published by AgFunder – a VC and investing marketplace focused on the agriculture and food sectors – the “AgriFood” space is booming. Using data from Crunchbase and several other data partners, the organization published its “2018 AgriFood Tech Investing Report” this morning, finding that investment in AgriFood companies increased 43% year-over-year, reaching $16.9 billion in 2018.

AgFunder classifies AgriFood tech as “the small but growing segment of the startup and venture capital universe that’s aiming to improve or disrupt the global food and agriculture industry.” Their definition is intentionally broad, encompassing everything from crop and livestock biotech, property management systems, and payments, to biomaterials and meat alternatives, all the way up to tech platforms for restaurants, grocers, deliveries and at-home cooks.

While some of the AgriFood tech categories – such as delivery or restaurant software – have long been popular destinations for venture capital, we’re now seeing a more diverse array of startups innovating across the entire food supply chain. According to the report, expansion in AgriFood is fairly consistent across upstream (agricultural and farming) subsectors to downstream (more consumer-facing) subsectors, with each group growing roughly 44% and 42% year-over-year respectively.

The data also shows growth occurring across almost all deal stages. AgriFood saw huge increases in the average deal size and total investment for late-stage companies in particular, as venture-backed startups have grown to global scale. And penetrating and attracting capital from international markets seems more feasible than ever. AgriFood investing, which traditionally has been largely US-centric, is rapidly becoming a global phenomenon, with more than half of total funding – and some of the largest rounds – now coming from companies and investors outside the US.


Source: The Tech Crunch

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Blue Apron hopes lower-cost meal kits, now on Jet in NYC, will help save its business

Posted by on Feb 6, 2019 in Blue Apron, eCommerce, Food, food delivery, jet, meal kits, Walmart | 0 comments

Blue Apron is introducing a lower-cost version of its meal kits, initially only for Jet.com shoppers in the greater New York City metro area. The new kits, called “Knick Knacks,” still require refrigeration, but require customers to supply their own protein and produce to complete the meal. But by dropping the two most expensive ingredients from the meal, the company has brought the price down to $7.99, compared with prices that ranged from $17 to $23 for the meal kits that launched on Jet last fall.

As you may recall, Walmart subsidiary Jet announced in October that it would begin selling Blue Apron’s meal kits to its City Grocery customers. Jet had relaunched its site the month prior with a new focus on serving the needs of urban shoppers, which included same-day delivery of groceries. The revamped site is now localized to where shoppers live, with images and messaging specific to the customer’s city.

The localization efforts would begin in New York, Jet said at the time, before rolling out to other major U.S. metros like Boston, Philadelphia and D.C.

Jet then became the first online retailer to sell Blue Apron’s meal kits — giving the meal kit company a needed boost at a time when its subscriber base had been in decline.

Though Blue Apron’s name had become synonymous with meal kits, they were beset with challenges on all sides — including then fast-growing competitors like HelloFresh, an inability to reduce unit costs, customer base declines and the challenges in converting newcomers to subscribers in the face of competition from ready-to-eat meals, delivered on demand and available at most markets today for pickup.

With Knick Knacks, Blue Apron is tackling some of the issues with its meal kits — namely, the high cost and the need to subscribe to receive them.

The company announced Knick Knacks last week on its earnings call, where it reported still very concerning numbers.

Earnings were down -62 percent year-over-year at $-0.18 and quarterly revenues dropped by -28 percent to reach $150.62 million, versus $210.64 million in the same period a year ago.

At this point, the future of Blue Apron is very much tied to how well its strategic partnerships, like this with Jet and the other with WW (formerly, Weight Watchers), eventually play out.

The new kits themselves will include a combination of pre-portioned spices, sauces, grains and dairy ingredients from Blue Apron’s premium suppliers, such as crème fraîche from Vermont Creamery, furikake from Mara Seaweed and preserved lemon puree from NY Shuk, as well as Blue Apron’s own proprietary products, such as its line of custom spice blends, the company says.

The debut collection includes the following:

  • Za’atar-Spiced Chicken
  • Mexican-Spiced Chicken Quinoa Bowl
  • Japanese-Style Steak & Rice Bowl
  • Creamy Shrimp Gnocchi

The kits are available in New York’s metro area only for the time being for both same-day and next-day delivery. The company declined to say when they’d hit other markets, or if Blue Apron would sell the kits elsewhere, like in Jet parent Walmart’s stores.

Blue Apron’s new launch comes at a tough time for the food delivery industry as a whole. Earlier this year, meal delivery business Munchery failed after having raised $125 million; Doughbies, Sprig, Maple, Juicero and Josephine also folded.


Source: The Tech Crunch

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Go-Jek makes first close of Series F round at $9.5B valuation

Posted by on Feb 1, 2019 in Asia, carsharing, Collaborative Consumption, Companies, financial services, food delivery, funding, Fundings & Exits, go-jek, Google, grab, Indonesia, JD.com, online food ordering, Philippines, series f, Singapore, Southeast Asia, Tencent, Thailand, transport, Uber, vietnam | 0 comments

Go-Jek, the Indonesia-based ride-hailing company that is challenging Grab in Southeast Asia, has announced the first close of its Series F round, as TechCrunch reported last week. The company isn’t revealing numbers. Sources told us last week that it has closed around $920 million, but we understand that today that the round is at over $1 billion. Go-Jek is planning to raise $2 billion for the round, as reported last year.

Go-Jek said that the first close is led by existing backers Google, JD.com, and Tencent, with participation from Mitsubishi Corporation and Provident Capital. It didn’t provide a valuation but sources told us that week that it is around $9.5 billion.

Starting out with motorbike taxis in 2015, Go-Jek has since expanded to taxis, private car and more. The company said it plans to spend the money deepening its business in Indonesia, its home market, and growing its presence in new market expansions Vietnam, Singapore and Thailand. It is also working to enter the Philippines, where it had a request for an operating license rejected although it did complete a local acquisition after buying fintech startup Coins.ph.

The Go-Jek business in Indonesia includes transportation, food delivery, services on demand, payments and financial services. That’s very much the blueprint for its expansion markets, all of which are in different stages. Go-Viet, its Vietnamese service, offers food delivery and motorbike taxis, Get in Thailand operates motorbike taxis and in Singapore Go-Jek provides four-wheeled car options.

Combined those efforts cover 204 cities, two million drivers and 400,000 merchants, the company said, but the majority of that is in Indonesia.

Grab, meanwhile, became the top dog after buying Uber’s local business, and it operates in eight countries. It recently crossed three billion rides to date and claims 130 million downloads. Grab said revenue for 2018 was $1 billion, it expects that to double this year. It has raised $6.8 billion from investors, according to Crunchbase, and its current Series H round could reach $5 billion.

Go-Jek claims it has 130 million downloads — despite just being in three markets — while it said it reached an annualized transaction volume of two billion in 2018 and $6.7 billion in annualized GMV. Those figures require some explaining as Go-Jek is being a little creative with its efforts to compete with Grab on paper.

Transactions don’t mean revenue — a transaction could be a $1 motorbike ride or a payment via QR code — and GMV is not revenue either, while both are ‘annualized’ which means they are scaled up after measuring a short period. In other words, don’t take these figures too literally, they aren’t comparable to Grab.


Source: The Tech Crunch

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Asian food delivery startup Chowbus raises $4M

Posted by on Jan 24, 2019 in chef, chief executive officer, DoorDash, Fika Ventures, FJ Labs, Food, food delivery, funding, greycroft partners, grubhub, munchery, Postmates, Startups, Uber, Uber Eats, Venture Capital | 0 comments

When one food delivery startup fails, another gets funded.

Chowbus, an Asian food ordering platform headquartered in Chicago, has brought in a $4 million “seed” funding led by Greycroft Partners and FJ Labs, with participation from Hyde Park Angels and Fika Ventures. The startup, aware of the challenges that plague startups in this space, says offering exclusive access to restaurants and eliminating service fees sets it apart from big-name competitors like Uber Eats, Grubhub, DoorDash and Postmates.

The Chowbus platform focuses on meals rather than restaurants. While scrolling through the mobile app, a user is connected to various independent restaurants depending on what particular dish they’re seeking. Chowbus says only a small portion of the restaurants on its platform, 15 percent, are also available on Grubhub and Uber Eats. 

The app is currently available in Chicago, Boston, New York City, Philadelphia, Champaign, Ill. and Lansing, Mich. With the new investment, which brings Chowbus’ total raised to just over $5 million, the startup will launch in up to 20 additional markets. Eventually, Chowbus says it will expand into other cuisines, too, beginning with Mexican and Italian. 

Chowbus was founded in 2016 by chief executive officer Linxin Wen and chief technology officer Suyu Zhang.

“When I first came to the U.S. five years ago, I found most restaurants I really liked [weren’t] on Grubhub nor other major delivery platforms and the delivery fees were quite high,” Wen told TechCrunch. “So I thought, maybe I can build a platform to support these restaurants,”

TechCrunch chatted with Wen and Zhang on Tuesday, the day after Munchery announced it was shutting down its prepared meal delivery business. Naturally, I asked the founders what made them think Chowbus can survive in an already crowded market, dominated by the likes of Uber.

“The central kitchen model doesn’t work; the cost is too high,” Zhang said, referring to Munchery’s business model, which prepared food for its meal service in-house rather than sourcing through local restaurants.

“We don’t own the kitchen or the chef, we just take advantage of the resources and help restaurants make more money,” Wen added. “The food delivery space is really huge and growing so quick.”


Source: The Tech Crunch

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Starbucks challenger Luckin snags $200M investment on $2.2B valuation

Posted by on Dec 12, 2018 in alibaba, alibaba group, Apps, Asia, Beijing, China, Coffee, E-Commerce, Ele.me, Food, food and drink, food delivery, funding, GIC, idreamsky, luckin, managing partner, Seattle, starbucks | 0 comments

Luckin, a startup that vows to topple Starbucks’ dominance in China, announced on Wednesday that it’s lifted its valuation to $2.2 billion after raising $200 million in a series B funding round.

That came only five months after the coffee upstart, which soft-launched in January, picked up $200 million in investment. Luckin has been on a spending spree to open shop and burnt through $150 million within the first six months in operation, its founder said in July when the company had a cash reserve of 2 billion yuan, or roughly $290 million.

Luckin currently operates across 21 major Chinese cities, totaling more than 1,700 shops. For comparison, Starbucks’s footprint spanned 3,300 stores in China as of May, though one has to take into account that the Seattle coffee chain entered China nearly 20 years ago.

Different from Starbucks, Luckin’s brick-and-mortar facilities are a mix of sit-down cafes and pickup booths, which double as delivery hubs, and take-out kitchens that are solely for delivery staff to pick up caffeine-infused orders and put them in customers’ hands within 30 minutes.

As a result, Luckin managed to build a dense network targeting office workers who may be drawn to the idea of coffee delivery because they can’t leave their desk. There’s at least one Luckin location within a 500-meter radius anywhere in downtown Shanghai and Beijing, the company claimed.

The light speed at which Luckin has expanded in less than a year probably got on the nerves of Starbucks, which went on to team up with Alibaba-owned food delivery giant Ele.me in August to bring coffee to people’s doorstep. The American company aims to expand its delivery services to 30 cities in China by the end of 2018.

Luckin’s co-founder and chief executive officer Qian Zhiya, who is the former chief operating officer at one of China’s largest auto rental firms CAR Inc, said her startup will continue to invest in products, technology and business development to improve user experience following the new round.

Luckin raised the fresh capital from existing investors Singapore sovereign wealth fund GIC, Chinese government-controlled China International Capital Corporation, Joy Capital and Dazheng Capital. Liu Erhai, founding and managing partner of Joy Capital, joined Luckin’s board of directors following the close of the round. Liu’s investment portfolio includes Car Inc, Facebook’s old Chinese rival Renren and Hong Kong-listed game publisher iDreamsky.


Source: The Tech Crunch

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Robot couriers scoop up early-stage cash

Posted by on Dec 1, 2018 in bots, Column, Daimler, DoorDash, estonia, food delivery, nuro, Postmates, robot, Robotics, San Francisco, Silicon Valley, starship technologies, TC, Tencent, Toyota AI Ventures, waymo | 0 comments

Much of the last couple of decades of innovation has centered around finding ways to get what we want without leaving the sofa.

So far, online ordering and on-demand delivery have allowed us to largely accomplish this goal. Just point, click and wait. But there’s one catch: Delivery people. We can never all lie around ordering pizzas if someone still has to deliver them.

Enter robots. In tech-futurist circles, it’s pretty commonplace to hear predictions about how some medley of autonomous vehicles and AI-enabled bots will take over doorstep deliveries in the coming years. They’ll bring us takeout, drop off our packages and displace lots of humans who currently make a living doing these things.

If this vision does become reality, there’s a strong chance it’ll largely be due to a handful of early-stage startups currently working to roboticize last-mile delivery. Below, we take a look at who they are, what they’re doing, who’s backing them and where they’re setting up shop.

The players

Crunchbase data unearthed at least eight companies in the robot delivery space with headquarters or operations in North America that have secured seed or early-stage funding in the past couple of years.

They range from heavily funded startups to lean seed-stage operations. Silicon Valley-based Nuro, an autonomous delivery startup founded by former engineers at Alphabet’s Waymo, is the most heavily funded, having raised $92 million to date. Others have raised a few million.

In the chart below, we look at key players, ranked by funding to date, along with their locations and key investors.

Who’s your backer?

While startups may be paving the way for robot delivery, they’re not doing so alone. One of the ways larger enterprises are keeping a toehold in the space is through backing and partnering with early-stage startups. They’re joining a long list of prominent seed and venture investors also eagerly eyeing the sector.

The list of larger corporate investors includes Germany’s Daimler, the lead investor in Starship Technologies. China’s Tencent, meanwhile, is backing San Francisco-based Marble, while Toyota AI Ventures has invested in Boxbot.

As for partnering, takeout food delivery services seem to be the most active users of robot couriers.

Starship, whose bot has been described as a slow-moving, medium-sized cooler on six wheels, is making particularly strong inroads in takeout. The San Francisco- and Estonia-based company, launched by Skype founders Janus Friis and Ahti Heinla, is teaming up with DoorDash and Postmates in parts of California and Washington, DC. It’s also working with the Domino’s pizza chain in Germany and the Netherlands.

Robby Technologies, another maker of cute, six-wheeled bots, has also been partnering with Postmates in parts of Los Angeles. And Marble, which is branding its boxy bots as “your friendly neighborhood robot,” teamed up last year for a trial with Yelp in San Francisco.

San Francisco Bay Area dominates

While their visions of world domination are necessarily global, the robot delivery talent pool remains rather local.

Six of the eight seed- and early-stage startups tracked by Crunchbase are based in the San Francisco Bay Area, and the remaining two have some operations in the region.

Why is this? Partly, there’s a concentration of talent in the area, with key engineering staff coming from larger local companies like Uber, Tesla and Waymo . Plus, of course, there’s a ready supply of investor capital, which bot startups presumably will need as they scale.

Silicon Valley and San Francisco, known for scarce and astronomically expensive housing, are also geographies in which employers struggle to find people to deliver stuff at prevailing wages to the hordes of tech workers toiling at projects like designing robots to replace them.

That said, the region isn’t entirely friendly territory for slow-moving sidewalk robots. In San Francisco, already home to absurdly steep streets and sidewalks crowded with humans and discarded scooters, city legislators voted to ban delivery robots from most places and severely restrict them in areas where permitted.

The rise of the pizza delivery robot manager

But while San Francisco may be wary of a delivery robot invasion, other geographies, including nearby Berkeley, Calif., where startup Kiwi Campus operates, have been more welcoming.

In the process, they’re creating an interesting new set of robot overseer jobs that could shed some light on the future of last-mile delivery employment.

For some startups in early trial mode, robot wrangling jobs involve shadowing bots and making sure they carry out their assigned duties without travails.

Remote robot management is also a thing and will likely see the sharpest growth. Starship, for instance, relies on operators in Estonia to track and manage bots as they make their deliveries in faraway countries.

For now, it’s too early to tell whether monitoring and controlling hordes of delivery bots will provide better pay and working conditions than old-fashioned human delivery jobs.

At least, however, much of it could theoretically be done while lying on the sofa.


Source: The Tech Crunch

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Deliveroo will enter Taiwan, its fourth market in the Asia-Pacific so far

Posted by on Sep 12, 2018 in Deliveroo, food delivery, Startups, taiwan, TC | 0 comments

Food delivery service Deliveroo is making headway in its Asian expansion strategy. The London-based company announced today that it will launch in Taiwan in the coming weeks, starting with Taipei, the country’s capital, before heading to other cities. This marks Deliveroo’s fourth market in the Asia-Pacific region (the others are Australia, Hong Kong and Singapore) and is also a launch with personal significance for founder and CEO Will Shu, whose family is Taiwanese.

In a press statement, Shu said “Our launch in Taiwan is also a personal milestone for me, my parents were born in Taiwan and much of my family still lives in Taipei. Taiwan is the market with my favourite food in the world—my personal favourite is a big bowl of 牛肉麵 [beef noodle soup] and a huge piece of 炸雞排 [fried chicken]. From a personal standpoint, It’s an amazing feeling to launch Deliveroo in Taiwan.”

Once its Taiwan business starts, Deliveroo, which is reportedly eyeing an IPO to take place in the next two years, will operate in a total of 13 markets around the world. The company already faces stiff competition in Taipei, however, where its rivals will include Foodpanda, Uber Eats and Honestbee. Foodpanda was the first, launching five years ago, but Uber Eats quickly became a formidable rival when it entered Taiwan in 2016. Honestbee, a grocery and food delivery service, is also popular, and during lunch and dinner times riders carrying these services’ cooler bags on the backs of their scooters are a ubiqutious sight on Taipei’s streets.

Like other food delivery startups, all three offer costly incentives like discount codes, flash sales and free delivery to entice customers. The resulting war of attrition has forced food delivery services in other markets to withdraw or consolidate. For example, Foodpanda sold off its Vietnam and Indonesia operations, before the company itself was sold by Rocket Internet to larger rival Delivery Hero at the end of 2016.

Deliveroo has the advantage of a large war chest, however, and its funding (its Series F last year raised about $480 million at a valuation of more than $2 billion) will help it with the high cost of competition as it expands into new markets.


Source: The Tech Crunch

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The Amazonization of Whole Foods, one year in

Posted by on Sep 1, 2018 in Amazon, Amazon Prime, Apple, Barclays, E-Commerce, Food, food delivery, Grocery store, Instacart, prime, Prime Now, smartphone, TC, United States, whole foods, Whole Foods Market | 0 comments

Amazon promised to breathe new tech into the relationship with Whole Foods after putting a $13.7 billion ring on it one year ago. So how did that promise shake out?

At the time, Amazon said the goal was to make “high-quality, natural and organic food affordable for everyone.” Bananas, avocados and even tilapia was going to be cheaper than before. Prime members would receive increased benefits with discount rewards and Amazon drones would be delivering packages right to your door.

Okay, that last bit was not promised — though we’re not the first to speculate on that possibility in the future.

A bunch of other Amazon offerings involving delivery options were also mentioned, including the getting of Whole Food groceries through a then new Amazon Fresh grocery delivery program and Whole Foods private label products would be made available through Prime Now and Prime Pantry. Further, Amazon lockers would be showing up at select stores to make pick ups and returns easier for Amazon customers. And, of course, new jobs would be created to handle all the new infusion of technology.

Soon customers started to see Amazon Echo devices popping up in stores, urging people to install them in their home for easier grocery ordering through voice command. Echo dots lined the walls and could be found surrounded by produce. Amazon promised to deliver more devices to try in-store ahead of purchase as time went on.

Since the launch, “customers have already saved hundreds of millions of dollars,” according to Whole Foods co-founder and CEO John Mackey. “So whether it’s better prices on your weekly shop, saving time through delivery from Prime Now or taking advantage of incredible weekly deals for Prime members, the overall customer experience is richer and more seamless than it’s ever been,” he continued.

I’m not sure the average customer would see the experience as “richer and more seamless” but the changes are noticeable. Walking into my local Whole Foods, the Amazon branding is everywhere from the deep orange lockers off to the side, the large, green Amazon Fresh coolers greeting me at the entrance to the parking lot and rows of bags ready for pickup and delivery via Amazon workers.

A large “Prime Member Deal” sign hangs down from the ceiling, greeting me at the front of the store. Beyond, there’s the produce, once fresh and free of rot with all organic labeling. Now? It’s unclear. I used to argue the “whole paycheck” prices were worth it for the better quality produce. Lately, I’ve had to throw a bunch of stuff out because it just doesn’t last as long or look as good. Not everything is organic.

Other shoppers have noticed the same dip in quality across the U.S., along with missing products or a lot of out of stock items they’d been buying for years at their grocery store.

It’s been called the “conventionalization” of Whole Foods by Wall Street investment bank Barclays, which also noted there had been some comments from Mackey about cultural “clashes” during his appearance at the American Production and Inventory Control society’s annual conference.

On the flip, Amazon has managed to add some nifty integrations for Prime members including club member style sales prices and five percent cash back for those purchasing groceries with their Prime Visa card. You want to do one better, just download the Amazon app to your smartphone, use the code given and then purchase with Apple pay using your Amazon Prime credit card for maximum benefits. Of course, that’s only for those all in with the system.

Adding to that, there’s the super fast two-hour delivery option (in 20 cities for now, with more to come this year, according to Amazon) and grocery pickup so you don’t even have to wander through the store to get everything you need (although, I am one of those who likes picking out my own produce and wandering through the store sometimes),

I’ve also enjoyed using the integrated partnership to order Whole Foods items straight from my Amazon Fresh account (a lifesaver in those early days of postpartum when it was impossible to get out of the house). Before the integration I could use Instacart but had to order from each store separately in different orders. With Amazon, I can order from various stores, including Whole Foods through my Amazon Fresh account all in one order and then choose a time for delivery.

There’s still some bumps with that process — you can’t order every item available in Whole Foods, just what Fresh offers that week through the Amazon platform. The bags are also large and often don’t fill up to their full potential, leaving a lot of waste. But that’s like complaining you can’t get good WiFi on an airplane. It’s frustrating but you are flying through the sky and messaging people on the ground. Similar, you are ordering food through the air waves and it shows up at your door step. In the grand scheme, it’s amazing!

Anyway, yes, there are more conveniences for Amazon Prime members and further integrations with technology to make the shopping experience easier. It does also seem Amazon has hired more workers to fulfill the needs this technology creates. At my own market it seems tough to tell who is an Amazon worker rummaging through the aisles for listed items and who’s just shopping for themselves these days.

Is the marriage working? Tough to tell at this point. Those promised changes may seem exciting for both parties but between disappointed shoppers and a “clash” in culture it may not have been what Whole Foods faithful wanted. Still, at least some vendors have said they’ve seen an increase in sales and volume of products sold since the acquisition, despite the drop in prices. And Mackey, comparing his love for his wife with the relationship said in a recent interview “I don’t love absolutely everything about my wife, either, but on balance I love, like, 98%. That’s a pretty good ratio, based on my previous relationships.”

It might not even matter what loyal Whole Foods customers think. The acquisition gives Amazon an opportunity to introduce its 100 million Prime members to the grocery store it envisions — one that could drop organic, fossil fuel free groceries via drone at their doorstep in the future.

While it’s hard to know how the partnership has impacted Amazon’s bottom line overall, we do know sales going up and to the right is a good thing. We still need to see how this relationship performs over time but one year in looks promising.


Source: The Tech Crunch

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Another food delivery startup, Foodsby, rakes in venture capital funding

Posted by on Aug 28, 2018 in delivery startups, food delivery, Foodsby, greycroft partners, Madrona, minneapolis, munchery, Recent Funding, Startups, TC, Uber, Uber Eats | 0 comments

Venture capitalists are still hungry for food delivery startups.

Foodsby, the provider of a lunch delivery service based out of Minneapolis, has raised a $13.5 million Series B led by Piper Jaffray Merchant Banking. Greycroft Partners, Corazon Capital and Rally Ventures also participated. With the new capital, Foodsby plans to expand to 15 to 25 new markets. The round brings Foodsby’s total raised to $21 million.

“We have established a successful model for new market entry with a tried and true combination of talent and technology,” Foodsby founder and CEO Ben Cattoor said in a statement. “We look forward to building on our early successes and learnings to deliver continued growth for our investors and our team.”

Founded in 2012, the company connects employees in office buildings in 15 cities with local restaurants. How it works: A hungry worker uses Foodsby to pre-order a meal from a restaurant in its network, Foodsby aggregates all the orders it receives, sends the orders to the restaurants and the restaurants then make all the deliveries at once, streamlining what can be a logistically complicated process. 

That strategy, the company says, sets Foodsby apart from competitors. Because Foodsby only works with businesses and has restaurants make the deliveries rather than its own fleet of delivery agents, the overall costs of the operation are lower. It’s free to join the Foodsby network as both a company that wants to provide the service to its employees and as a restaurant. Deliveries cost $1.99 per person. 

While continued VC support may give the company a vote of confidence, the food delivery space is crowded and competitive. Foodsby is not unlike Peach, a Seattle-based office lunch delivery service that shed one-third of its staff in March. Peach had also landed VC support, raising about $11 million from Madrona and others. Munchery, another similar meal delivery service, also looks to be in hot water, laying off 30 percent of its workforce in May and ceasing operations in Los Angeles, Seattle and New York.

Food delivery startups are hit or miss, but VCs continue to flock to investment rounds in hopes of betting on the next Uber of food delivery — though Uber itself is really the Uber of food delivery, its food delivery service is reportedly the most profitable arm of the ride-hailing giant. And Uber, much like Amazon, is not a company you want to be going head-to-head with. 


Source: The Tech Crunch

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