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35 Pct Larger Than Grubhub Turkish Delivery Firm Getir Nets $7.5B Valuation

Turkish Delivery Firm Getir Nets $7.5B Valuation, 35 Pct Larger Than Grubhub

June 04, 2021 at 05:28PM
by PYMNTS

About a month after reaching $7 billion, Getir’s valuation keeps soaring. The Turkish grocery delivery service announced on Friday (June 4), with its Series D funding round bringing in over $550 million, that its valuation has topped $7.5 billion, and the company raised almost $1 billion of that since the start of 2021.

The company specializes in 10-minute delivery, enabled by its network of scooter drivers, hired either full-time or paid a fixed hourly rate, according to the Financial Times. Within Turkey, the company fulfills more than five million orders each month.

In recent months, powered by its massive fundraise, the company has been expanding to other countries, having already come to London in January, a launch it described as “hugely successful.” More recently, Getir debuted in Amsterdam in May. In the coming weeks, the delivery service will launch in Paris and Berlin, and down the line, it will come to select United States cities.

“Our model and approach to ultra-fast delivery is thriving, and this latest round of funding further enables us to deliver our best-in-class service to new customers in Europe, the United States and beyond,” Nazim Salur, founder of Getir, said in a statement. “There is a great appetite for Getir and rapid grocery delivery. As the pioneers of the market, we continue to stand out by constantly innovating to provide the industry standard.”

Competitor Gorillas, which also boasts 10-minute delivery times and operates in London and Paris, as well as in select cities throughout Germany and the Netherlands, recently hit $6 billion. The Berlin-based company will beat Getir to the potentially very profitable, albeit highly competitive, United States market — in late March, the service announced its American launch in select neighborhoods in New York City.

Gorillas Chief Executive Officer and Co-Founder Kağan Sümer said in a statement at the time: “As a result of the pandemic, online grocery delivery has seen steep momentum, but now that this industry has experienced the long-overdue propulsion into eCommerce, it will be here to stay.”

Grocery delivery is getting faster across the board. Instacart recently launched 30-minute delivery. New York City-based 15-minute delivery service Fridge No More recently raised $15 million in its Series A funding round. In April, French grocery giant Carrefour teamed up with Amazon-backed U.K. food delivery service Deliveroo for 30-minute grocery delivery in France, and the delivery service is also partnering with U.K. grocer Sainsbury’s to bring speedy grocery delivery — sometimes as short as 20 minutes — to 100 of the grocery chain’s stores.

The global e-grocery market is projected to hit $663 billion in 2024, growing by a whopping 25 percent per year, according to one analysis. Still, for all the demand from consumers and the interest from investors, grocery delivery is no golden goose. The economics of the model are notoriously difficult to manage — and as each new delivery service hits the market with millions or billions supporting its launch, the space grows increasingly competitive.

One major issue affecting the space is that companies relying on gig workers are beginning to face scrutiny from consumers and lawmakers, as low wages make headlines around the world. Consequently, new regulations may limit the ability of the model to be profitable — an issue that was likely partially responsible for Deliveroo’s IPO flop. With so many players, it remains to be seen which global e-grocers will be able to make grocery delivery profitable while maintaining a sustainable labor model and gaining consumers.

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