According to a report by The New York Times on Thursday, April 14, Gopuff delayed its initial public offering (IPO). Instead, it is trying to raise $1billion in debt that could be converted into stock and lower California drivers’ minimum wages.
The company has had to make two rounds this year of job cuts, including last month when it laidoff about 450 people or 3% from its 15,000 workers. This proves that it is not immune from the struggles in an industry that has seen a lot of consolidation.
Instacart reduced its valuation last month from $39 billion a $24 billion. The report also noted that DoorDash and Grubhub, as well as other delivery services, have not been able to gain the same traction and growth as public companies.
These companies are fine in an extremely ebullient capital markets environment. Ken SmytheNext Round Capital Partners’ chief executive officer is, who advises investors on buying and selling shares in startups. The world has changed dramatically in the past 60-days.
Gopuff co-founder Yakir GolaAccording to the NYT, delivery is very complicated and takes a lot time. However, having warehouses and inventory is the only way for a company to make money over time. This means that the company can make money on the goods they sell, not just delivery fees.
Gola said that once you are able to execute, which is obviously hard, it wins over the long term.
Gopuff is delaying the IPO due to stock market volatility and the fact that it has enough cash in hand to avoid going public. According to the report, the layoffs are part a global restructuring plan.
Related: Gopuff Team with UK Grocer Morrisons to Deliver Instantly
Gopuff partnered in March with Morrisons UK supermarket giant to quickly bring thousands more goods to consumers across the nation as part of a multiyear deal. The deal adds fresh food, Morrisons-branded products and other brand products to Gopuffs platform.
——————————
NEW PYMNTS DATA: THE FUTURE BUSINESS PAYABLES INNOVATION STUDY, APRIL 2022
About: Over half of SMBs believe an all-in one payment platform can save time and improve cash flow visibility. However, 56% think it could be difficult for the solution to be integrated with existing AP or AR systems. The Future Of Business Payables Innovation Survey, a collaboration between Plastiq, PYMNTS, and Plastiq, surveyed 500 SMBs that had revenues between $500,000-100 million to see if all-in one solutions could meet their needs and help them plan for the future.