Gopuff, a startup that has helped to launch a new type of food delivery service in the U.S., offers instant delivery of essential groceries and home goods for a flat fee (just $1.95) 24 hours a days. It also recently closed a large tranche of funding to expand its services across the country. The Philadelphia-based startup has raised $1 billion in Series H funding that will bring it $15 billion.The round was supported by new backers Blackstones Horizons platform and Guggenheim Investments. Previous backers Fidelity Management and Research Company, Softbank Vision Fund 1 Atreides Management and Eldridge Capital also participated.This confirms the scoop we reported last week on Series H while it was still being closed.Gopuff stated that it will use the funding to expand in North America, Europe, the UK (where Fancy has already acquired a company and sources say it is purchasing another, Dija), as well as to hire more people and continue to build out its tech platform, which bridges the ecosystem of customers, drivers and suppliers.It operates approximately 450 locations in North America and the UK. This includes more than 285 dark shops (or micro-fulfillment centres in Gopuffs' words) as well as more than 185 retailers.Gopuff raised so much money because it is capital-intensive to build a food-based, logistics-driven, and transportation business.However, this effort to grow comes amid a strong surge in competition. Sequoia and other investors have supported Getir, which is expanding aggressively in Turkey. It was recently valued at $7.5 million. Flink, Glovo and Zapp are just a few of the European delivery giants that have been expanding aggressively. In the U.S. established delivery giants such as DoorDash will be expanding into Gopuffs territory.Gopuff believes that it can compete with all these companies and more. Gopuff was founded by Rafael Ilishayev, now co-CEOs, while still at university. It fills a need for students to find affordable ways to obtain essential items without having to go out.Gopuffs was quickly adopted by many people who were being asked or ordered by their municipal governments to keep the Covid-19 spread under control.However, Getir, a Turkish company that has been in business for many years and which provides instant delivery of essential products, has shown that the concept is viable. That is what Gopuff is also betting on.Scott Minerd (Global Chief Investment Officer at Guggenheim Investments), stated that Gopuff quietly built a strong business. He said that Gopuff continues to be the leader in this category. Rafael and Yakir focus on fiscal responsibility, while being able to execute on strategic growth opportunities. Gopuffs amazing offering and their measured approach have only scratched the surface. We are proud to support this company, and we look forward to continuing to be a part of Gopuffs' growth.Gopuffs strategy was to improve the basic instant delivery model of essentials with more efficient distribution and a wider view of what constitutes essentials.In addition to expanding local dark stores so that they can more easily distribute goods to customers who purchase them, this has also included the creation of Gopuff kitchens to prepare and deliver ready-made foods; purchasing alcohol retailer BevMo at $350 million in November 2020; as well as acquiring additional logistics technology in the form rideOS, which was purchased for $115 million.Gopuff has been on a fundraising spree to fund all this. It raised $1.15 Billion at an $8.9 Billion valuation in March, just months after it had raised $380 Million at a valuation of $3.8B. In a span of 10 months, the three most recent rounds have raised $2.5 billion. The idea is that there may be more.We are delighted to welcome new global partners and the support of long-standing investors as Gopuff continues to redefine the Instant Needs Economy. Ilishayev stated that this funding round will allow us to deliver an unparalleled customer experience and further validate our model's success.We have really doubled down on our business priorities. This includes accelerating our geographical expansion through entering new markets in the US, as well as innovating for customers. Yakir Gola said that we look forward to improving the customer experience and bringing the magic of Gopuff across the globe.
