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GrubMarket , the $ 3.6 billion food for thought speech and supply chain startup plump for by Tiger Global , BlackRock and nearly 100 other investor , has snapped up another food for thought delivery startup on its consolidation march : It is acquiringFreshGoGo , a New York - based , B2C platform selling Asian groceries and quick - made dishes .
Terms of the deal are not being disclosed , but we understand that the deal take a mixing of immediate payment and shares in GrubMarket . FreshGoGo had raised around $ 15 million from item-by-item investor , according to GrubMarket . FreshGoGo father Jianbing Duan will stay with the troupe and retain running the business .
The acquirement is coming close on the heel of another deal : sooner in August , GrubMarketacquired Good Eggsfor an unrevealed pith .
FreshGoGo has around 210,000 customer across 27 states , and generates one-year revenue of about $ 30 million from sale of grocery store , “ solid food lawcourt ” ready - made meals and other prepared and off - the - shelf food products . The troupe is not profitable .
The mountain underscore the ongoing evolution of the food logistics and delivery space . inauguration establish just before or during the COVID-19 pandemic found themselves riding high as much of the world stayed indoors and desire to spice up eating at home . These startups built apps to facilitate ordering , supplying - chain management and bringing logistics .
Typically , these startups were build as three - sided marketplaces involving food supplier , the people carrying out the delivery and terminal - customer buying food for thought . Collectively , they raised hundreds of millions of dollar sign in venture funding as investor hungrily eyed thriving consumer interest . And the startups take the terminal figure sheets to contend for byplay with rebate , gratis promotion and splashy ad campaign .
By 2022 , however , things had changed . Not only were people returning to pre - pandemic consumption patterns ( and going outside again ) , but the economy was shift . Inflation and unemployment were on the rise , place a lot of pressure on line of work selling nice - to - haves . Tech company focus on delivery services date growth tableland or even worsen .
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FreshGoGo had similar trouble , but it appear to have had some other issues , too : This story from 2022details the company ’s struggles to pay vendors — those selling intellectual nourishment on the platform — on fourth dimension .
GrubMarket , found out of Silicon Valley and incubated at Y Combinator , startle off with fresh produce , specifically pose itself as the digital interface for yield and vegetable growers who were looking for more efficient ways to connect with retailer and consumer . It eventually focused just on retailer and became a key provider to Whole Foods and other well - known section stores and grocer .
It has raisedover $ 600 millionto escort , according to PitchBook . And while a numeral of smaller companies fight with unit economics , GrubMarket grew and leveraged its newfound heave up to acquire those little companies . Its aim , say CEO and founder Mike Xu in an audience , is to desexualise what is n’t working in otherwise hopeful venture . For example , in the case of Good Eggs , Xu said that inauguration is now about to flex a lucre afterstrugglingfor years .
FreshGoGo is quite a turn away from Good Eggs , a mellow - profile Bay Area deary , and today ’s deal percentage point to how GrubMarket is exploring the longer tail of food distribution opportunities . Other culinary art - specific accomplishment GrubMarket has made cover Korean , South American , Caribbean and Greek food for thought .
Duan founded FreshGoGo in 2017 in New York , pink into the all-encompassing connection of independent food trafficker and solid food courts frequented by Chinese immigrant communities and adventurous epicurean on the search for reliable food that can be hard to find in most grocery memory or mainstream Asian eatery .
FreshGoGo ’s premise was to bring those products to more people , and it built a across-the-board logistics and online commerce patronage around that — it claimed that its median basketful size was more than $ 100 . It was a simple premise , but it seems it was challenging to execute , judging by the reputation of missed supplier payments and the stagnating growth that led to the company ’s sales agreement to GrubMarket .
Although GrubMarket bear on to be focused mainly on B2B , it will continue to pick up B2C companies opportunistically , as it did with Good Eggs and FreshGoGo , Xu enounce . If the company can transmigrate more cognitive process to its own platforms , GrubMarket and the companies it ’s buy will both get better economies of scale , Xu articulate .
“ We stay opportunistic about B2C accomplishment for those B2C companies who are solid financially and upper-case letter - effective , ” he impart , “ which either have been breakeven / profitable , or can be turned to breakeven or profitable quick after our takeover . ”
