Record-level investments are flowing into food delivery startups.
Remember home-ec class? Now there’s an app to help pass it.
It’s called Deliveroo, and since the startup launched in London two years ago, it’s become a dominant player in England and Ireland, where its network of drivers and bicyclists transport ready-made meals from a list of “curated” restaurants to customers’ homes in 32 min, on average.
Now it’s got even bigger ambitions, after investors gave Deliveroo $70 million this week. Its sights are set on all of Europe’s food delivery market, effectively giving kids an excuse to fail home-ec class.
“We’re going to try to be No. 1 in every European market within a few months,” said Fred Destin, an investor at Accel Partners, an early backer of the company.
Destin said Deliveroo will begin expanding rapidly across “a number of European cities,” but he’s tight-lipped about exactly which ones. Still, the London-based venture capitalist is more candid about why his firm backed a food delivery startup in the first place, even when other much larger European food delivery startups like Just Eat and Delivery Hero had already been operating.
“Competition might be an issue, but market size isn’t,” he said. “This is a huge market… Within a few years, food — I think without a doubt — will be the largest category within e-commerce.”
These days, he might as well be preaching to the venture capitalist choir.
Food has emerged as one of the hottest sectors in latest wave of instant gratification startups. Look beyond GrubHub — the 11-year-old online food and delivery site that went public last year — where dozens of startups are launching that want to effectively turn you into an eating, drinking and, even in some cases, pot-smoking couch potato. In the past year and a half, a record-level of cash has flowed into food delivery startups, virtually ensuring that people will never have to lift a ladle ever again — or at least that “The Joy of Cooking” won’t be getting re-printed for future generations.