German food delivery company Delivery Hero has made an investment of $235 million in grocery startup Gorilla. The investment was made as part of a $1 billion fundraising round.
Founded in May 2020 during the pandemic, Gorillas ships groceries to people’s doorsteps. The company makes its deliveries in as early as ten minutes and saw its operations boom as a result of the pandemic which kept people in the house. Delivery services have kicked off as a result of the high demand for them. Gorilla is amongst other companies that are trying to take the lead in an ever-booming space. Its rivals include Turkish company Getir, British company Zapp and Germany’s Flink.
According to Delivery Hero, it now holds an 8 percent stake in the company. Delivery Hero led the round and other investors that participated include China’s Tencent, Coatue, DST and Dragoneer. Delivery Hero is one of Europe largest online food delivery platforms and competes with only a handful of establishments in its line of business such as Just Eat Takeaway and Deliveroo. Delivery runs a chain across various countries and wants to continue to expand.
Following the funding round, Grocery delivery startup Gorillas is now valued at $3.1 billion. Although it is an impressive figure, it is lower than the expectation of $6 billion that the company had reportedly been eyeing.
Speaking on its investment in Gorilla on Tuesday, Delivery Hero’s Founder and CEO Niklas Östberg said that “Delivery Hero is on a mission to advance quick commerce globally and we see Gorillas as one of the leaders in Europe and the US. The Gorillas team has an exceptional customer focus driving the highest retention rates we have seen in the industry”.
According to Gorillas, it run rate is now at $300 million and it is quite impressive for a company that is less than 2 years old.
As of Tuesday morning, shares of Delivery Hero were up over 1 percent.