Getir, the rapid grocery delivery service, has raised nearly $800mn in new funds at a valuation of $11.8bn, catapulting the price tag of the Istanbul-based start-up ahead of more established food apps Deliveroo and Just Eat Takeaway.
Despite a sharp sell-off among publicly quoted food delivery companies including Deliveroo, Just Eat and Delivery Hero, Getir has seen its valuation rise by more than 50 per cent since its last financing in June, making it one of just a handful of private European tech companies to be worth more than $10bn.
News of the financing came as rival Deliveroo completed its first year as a public company. The London-based food app has seen its stock price fall by almost two-thirds since its rocky debut last March. However, Deliveroo’s shares rallied on Thursday after chief executive Will Shu set out a plan to reach underlying profitability by mid-2024.
Takeaway app companies have come under greater pressure from investors to deliver profits after a bumper couple of years of revenue growth during the pandemic.
Getir’s investors include Mubadala Investment Company, Sequoia Capital and Tiger Global. Its increased valuation comes at a time when many investors are marking down the prices of public and private tech companies.
Nazim Salur, Getir’s founder, said investors were “more picky” as it pitched its latest round. “This one is different because the public markets were quite challenging the last few months,” he said. “If the market was nicer probably [our valuation] could have gone up even further.”
Getir’s revenues increased more than fourfold last year, Salur said, but after expanding to dozens of cities in nine countries last year it plans to focus on “efficiency” and growth in its existing markets this year.
Losses at Deliveroo widened last year due to increased investments in marketing and technology and it warned of “caution” in the year ahead. But the company’s announcement that it aims to reach profitability within two years led to its stock rising 6 per cent on Thursday, giving it a market capitalisation of £2.8bn.
Just Eat Takeaway, whose shares have fallen almost a third so far in 2022, now has a market capitalisation of around £6.6bn, while Berlin-based Delivery Hero is valued at €11.1bn after falling by more than half in the first three months of this year.
Lockdowns boosted takeaway services’ revenues over the past two years but online delivery platforms are now facing a far tougher macroeconomic environment, as wage and food price inflation begins to bite.
Competition between Deliveroo, Uber Eats and Just Eat in the UK remains intense, as those companies also face fresh challenges from grocery delivery start-ups such as Getir and Gopuff.
Deliveroo said on Thursday that growth in transaction volumes would slow to 15-25 per cent this year on a constant currency basis, compared with 70 per cent in 2021.
Shu said that Deliveroo aims to reach break-even, on an underlying basis, “at some point” between the second half of 2023 and the first half of 2024.
“It is really important to put a stake in the ground not just for shareholders but internally as well,” Shu said, insisting that Deliveroo could become profitable while also continuing to grow. “This industry is obviously still early but it is maturing.”
Overall revenues at Deliveroo rose by 57 per cent in 2021 to £1.82bn, while pre-tax losses rose 40 per cent to £298.2mn. Orders grew 73 per cent to 300.6mn.
Source: Financial Times