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The Case for 15-Minute Grocery Delivery is Questionable. So Why Did It Raise So Much Capital?

For about as long as I’ve been seriously watching the Internet industry, companies have been trying to make a business of home grocery delivery.

It started back in the late nineties when companies like Webvan and Homegrocer raised massive amounts of capital after convincing investors that food shopping would be largely done online in the future.

Webvan would raise almost $400 million in venture investing and another $375 million through an IPO. HomeGrocer raised $440 million in venture capital and almost $288 million going public.

None of it was enough. The two companies would eventually merge and went bankrupt less than a year later.

Of course, some online grocers survived, including some originating in the early days of the Internet. Ocado, conceived in the year 2000, continues to this day and is one of the biggest online grocers (and grocery automation technology companies).

But despite the occasional success story like Ocado, the reality is online grocery shopping is a tough business, one that seems to possibly work as part of a broader omnichannel market approach where grocers like Walmart, Kroger and now, yes, Amazon offer both in-person and online shopping experiences for the consumer. And even Ocado.com is essentially an omnichannel model, partnering in the early days with Waitrose.

Which brings us to the 15-minute grocery category, a model built around hyper-local delivery with distributed micro-fulfillment centers placed in dense urban markets like NYC, Philadelphia, and other locations. Startups in this space focus on convenience, offering a limited set of items, not unlike you might find in a convenience store like 7-Eleven (but usually with a little more fresh food sprinkled into the mix).

The market, which in some ways kicked off with GoPuff’s founding a decade ago, witnessed a whole bunch of new entrants enter the market over the past couple of years, including companies with similarly weird names like Gorillas, JOKR, Fridge No More, Weezy to name a few. These companies feasted on a downright frothy venture capital market, raising a breathtaking $4 billion last year alone:

However, with the worldwide economic climate facing significant uncertainty in the face of decades-high inflation, rising interest rates, and a war in eastern Europe, the easy money spigot has been shut off. As a result, some of these companies are either falling into the deadpool, getting scooped up by other competitors, or like JOKR and Gorillas, attempting to cut costs through layoffs and market pullouts to preserve capital runway as they try to survive what looks to be a long economic winter.

Of course, all of this begs the question: Why did all these startups get so much funding in the first place? As the early online grocers demonstrated, building out a network of stores and warehouses and a delivery infrastructure to get a basket of goods to consumers is an extremely expensive business.

Don’t believe me? This chart from a recent McKinsey report on online grocery shows just how tough the margins are for a standard online grocery business before we even consider the extra costs of accelerated delivery.

For a typical e-grocery business, COGS (cost of goods – i.e. groceries – sold) are the biggest expense, around 70% of a total order. The leftover 30% is eaten up by in-store and pick-and-pack labor, last-mile delivery expenses, and associated e-commerce fees. When it’s all said and done, a typical online grocery order has a negative 13% margin.

Of course, fast-grocery startups might offer slight markups in pricing and also make money through delivery fees (which range from $1.80 to $5 per order) and membership subscriptions, but what’s somewhat surprising in retrospect is that fast-grocery companies don’t have drastically different pricing or fee structures compared to that of traditional e-grocery prices.

Beyond the negative marginal profit of each order, the biggest expense driver for these companies and what likely ate the lion’s share of the billions of dollars in the collective capital runways is the buildout of their fulfillment centers and dark store networks. Being fast requires lots of points of presence to be within a 15-minute delivery window (or shorter, since fulfillment and delivery driver load-in takes at least a few minutes once the order comes through), which means lots of construction, equipment and technology costs.

Indeed, the venture community must have seen something here in a business – online grocery delivery – that has shown itself to be historically unprofitable. My guess is the rationalizations for writing these large checks fell in the following categories:

Customers will pay for convenience: We’re living busy lives and sometimes we just want what we want. If someone can get me a six-pack of beer, a steak, and a bag of chips to my house in 15 minutes, I’ll choose that option.

The pandemic changed the game and converted us into an e-grocery nation: In the early days of the pandemic and throughout 2020, we saw unprecedented conversion rates to online grocery as many consumers were forced to use it for the first time. Surely once they went e-grocery, customers wouldn’t return to the old way of doing things.

The siren song of the giant TAM: Food is a huge industry. I’m sure pitch-deck-making founders convinced investors they could convert a large enough percentage of food shopping customers to their business to take home a healthy percentage of the total available market (TAM) in the long run.

Long-term, technology & automation would drive costs down: I am sure many fast-grocery startup founders thought if they could just amass a large and loyal user-base, they could apply technology and automation to bring down the costs and increase margins as they moved past the large-scale infrastructure buildout of the early years.

These rationales for the fast-grocery business may make sense in a vacuum, and I am sure the impressive growth of early-growth pioneers like GoPuff helped convince many startup founders and eager investors there was some long-term gold to be found in those fast-grocery hills. But therein lies the problem: a closer look at these prospective businesses and anticipation of changing environmental factors – both in the form of the global macro-economic situation and the rise of competitors with built-in cost advantages – should have been enough to turn away some of the investors who jumped into this space.

Consider the e-grocery boom of 2020. While many of us thought that the rapid adoption of e-grocery would likely have some staying power even as the pandemic faded, it was never clear how just how much an average e-grocery shopping consumer would buy online once they had the opportunity to head down to their corner grocery store or load-up on staples at their warehouse store. From the looks of it, many consumers are returning to their local stores.

As for the promise of convenience, even if we assume sub-hour delivery time does offer some value to consumers, that value is reduced if there is a convenience store on the corner where one could just go pick up the goods instead.

And, say, a customer did occasionally use these services, was there any reason to assume they would continue to be that impatient? Amazon and Walmart often can usually deliver within an hour or two. Customers who want something quicker can always use a DoorDash or another food delivery app to get something to you quicker.

In reality, these adjacent competitors should have been the most significant reason investors stayed away from this space. These companies are all logistics-optimized, well-capitalized businesses that are eyeing the same TAM of the newer entrants. They also have legacy businesses with which they’ve built customer lists in the tens of millions in some cases.

We’ll see more consolidation of this market, and my guess is one or two of these startups have a chance to emerge on the other end as long-term survivors. With its early start and a warehouse network that’s largely built out, GoPuff looks like it could have enough of a customer base and capital in the bank to weather the storm. Gorillas, having just raised $1 billion late last year, may have sufficient runway if they can manage their burn rate through the downturn.

But no matter how this market shakes out, investors will be much more hesitant to sink capital in this market, particularly for companies with no discernible differentiation. Long-term, my guess is we might be talking about the fast-grocery boom of the early 20s for the next decade or more as a cautionary tale of a venture-capital fever investing, at least until the next boom cycle causes us to forget the lessons of the past once again.

Is The Regulatory Tide Turning Against Ultra-Fast Grocery’s Dark Store Model?

Every week last year, it seemed a new story dropped about a tens millions of dollars funding round going to an ultra-quick store concept.

These startups, often with funny names like Gorillas, JOKR, Buyk and GoPuff, utilize networks of dark stores nestled into residential or mix-used neighborhoods to ensure deliveries can get to consumers within the promised time.

Not surprisingly, as these apps have risen in popularity, existing brick and mortar stores like NYC bodegas have not been happy. Not only are these news apps taking away business, but the addition of new delivery riders are adding traffic and sometimes leading to confrontations with locals.

The pushback by store owners and some residents has been heard by local politicians. According to the New York Post, a New York politician named Christopher Marte is introducing legislation that would ban these companies from advertising 15 minute delivery times.

Another politician, NYC councilwoman Gale A. Brewer, thinks they’re illegal. “They’re going to kill the wonderful Latino restaurants, the wonderful bodegas, the wonderful delis, every single wonderful mom-and-pop supermarket,” Brewer said at a recent press conference. “These Gopuffs and JOKRs and Gorillas gotta go!”

And it’s not New York where there’s pushback. In Amsterdam, where there are 31 dark stores, citizens have started to launch petitions against the dark store networks and to track their behavior on Instagram. A recent story in Ars Technica details how one dark store startup named Zapp disrupted life on one narrow street in a neighborhood called Fagelstraat.

Alex, who has lived on the street for seven years and requested anonymity to avoid further conflict with riders, says there are now 10 to 15 deliveries each day, and giant lorries regularly block the narrow road. “It’s a 24/7 business,” he says, “so riders are coming in and out late at night and early in the morning. At 2 am, I often have people standing in front of my window, smoking and talking really loudly while they are taking a break.” After a month of this, riders and residents started squaring off as tensions boiled over, Alex says.

The growing push for legislation and pushback by consumers had led some investors to become more skeptical of the model. Kunal Lunawat, co-founder and managing partner of Agya Ventures, points to thin margins and the commitment to medium to long-term leases signed using venture funding.

“There appeared to be no consideration given to the economics of these leases over a 1-3 year period,” Lunawat said.

In some ways, the dark store startups are using the same ‘move quickly, break things, ask for forgiveness later’ model pioneered by other disruptive startups (think Airbnb and Uber) over the past decade. And just like home share and rideshare apps eventually saw a wave of new rulemaking at the state and city level, I expect that NYC and Amsterdam are both a sign that a similar wave of legislation and potential bans around dark store models is underway and could take years to iron out.

It will be interesting to see if consumers (and investors) will continue to believe in these new companies as they come under increasing fire.

DoorDash Enters Ultra-Fast Grocery Market, Hires Couriers in Break From Gig Worker Model

Today DoorDash announced it is entering the hyper-competitive ultra-quick grocery delivery market with the launch of a new DashMart location in New York City. According to the announcement sent to The Spoon, the new location will stock up to 2000 items and complete deliveries within 10-15 minutes of a customer’s order.

The new initiative follows the launch of DashMart, DoorDash’s own branded dark grocery network, in 2020. The expansion into hyper-fast is a logical next move, especially for a company with as robust a nationwide logistics and delivery network as DoorDash.

DoorDash’s new effort also represents a significant departure from the company’s traditional gig worker model. Instead of using freelancers to deliver groceries for its new effort, DoorDash will hire its own couriers for the first time. The company plans to hire sixty workers to staff the effort, each getting paid $15/hour plus benefits and tips to start. The new couriers will work for a new DoorDash subsidiary named DashCorp.

The move to hire a courier workforce is, in part, due to pressure from states like New York, which have begun to pass legislation placing greater protection on gig workers. The move also makes sense in that the ultra-fast grocery model requires a ready stable of couriers to deliver goods to consumers as they come in.

“Millions of people across the country turn to platforms like DoorDash to earn supplemental income when, where, and how they choose, providing them with unique flexibility and choice that is so valuable,” said company president Christopher Payne. “We’re proud to be a leader in providing economic opportunities that fit the lives of so many people. And now, we’re excited about the new employment opportunity that DashCorps offers for a different type of work.”

DoorDash’s latest moves follow discussions by the delivery giant to invest in Berlin-based fast-grocery pioneer Gorillas. The talks, which would have given DoorDash a buy option on the Berlin-based company, eventually fell apart, and it’s unclear how much of DoorDash’s newly launched fast-grocery initiative was a direct result of the fizzling effort between the two companies. Whatever their intention, it’s clear now with the launch of its first fast-grocery outpost and the launch of DashCorp that DoorDash is building infrastructure for roll-your-own strategy in this nascent but fast-growing market.

For Gorillas, JOKR, Gopuff, and others in this new space, DoorDash will undoubtedly represent a potentially significant new competitor. The delivery company commands a 55% market share in the US food delivery market and a year ago had 20 million monthly active users. While JOKR, Gopuff, and others have had no problem raising eye-popping amounts of venture funding, these companies have to invest much of their venture funds into user acquisition and logistics, areas which already have been well-developed by the more mature DoorDash.

The Week in Food Tech Funding: Perfect Day’s Big Raise & Gorillas Quits Monkeying Around

The week’s big news is a $350 million Series D raise by precision fermentation unicorn Perfect Day. There’s a whole lot packed into this announcement, so let’s get right to it:

First, the funding raises Perfect Day’s total to $750 million and sets the company on track for a possible IPO. The timing couldn’t be better, as tech startups continue to see rising valuations and the market is hungry for more food tech (see Oatly). And while Ginkgo Bioworks was the first company with significant precision fermentation (PF) capabilities to IPO, Perfect Day will be the first true future food PF pure-play to go public.

As part of the news, the company announced an expansion of its consumer products company, the Urgent Company (TUC). TUC, Perfect Day’s wholly-owned CPG company behind the Brave Robot ice cream brand, will add new “household staples” to its portfolio with Modern Kitchen, the second consumer brand under the TUC umbrella. Modern Kitchen’s first product will be dairy-free cream cheese, which the company will make with its animal-identical whey. As part of the announcement, TUC revealed Brave Robot is now in 5 thousand stores and that they’ve moved a million pints of ice cream.

Speaking of Brave Robot, it always struck me as a risky choice for a product name. Sure it stands out, but Brave Robot also doesn’t exactly make one think of tasty ice cream, which I think is the biggest challenge for a product that also wants to somehow communicate to the consumer it is made differently from traditional ice cream. With Modern Kitchen, I have to wonder if Perfect Day went purposefully conservative, choosing a brand this time around that doesn’t create extra work for itself.

Perfect Day also announced their third line of business (the other two being ingredient innovation and consumer products) in enterprise biology scale-up services. This move is a formalization of its enterprise biology efforts that started with the company’s 2020 acquisition of bioprocess scale-up facility SBF. With its new business line, Perfect Day hopes to help other food companies with technology transfer and scale-up consulting services.

“We first got into the ingredient business because food companies, big and small, were eager to work with the ingredients we had successfully scaled,” said Perumal Gandhi, Perfect Day co-founder, in the news release. “Today, something analogous is happening on the technology side. There are innovators all over the world with ideas and ambitions similar to our animal-free milk protein, but need help getting there. We’re standing up business models to be able to share our demonstrated capabilities in a way that maximizes upsides for all, yet ensures that Perfect Day remains at the forefront of our new industry.”

What struck me about the series of announcements is they illustrate how Perfect Day has matured in both its business and how it talks about itself. The addition of business services not only adds a new revenue line to the company, but it is a strategically savvy move that will set Perfect Day up with a pipeline of long-term IP licensing and ingredient supplier opportunities.

On the company messaging front, it wasn’t all that long ago that Perfect Day struggled to describe its technology and the animal-free dairy products that resulted from it. That’s changed, however, as this announcement brims with confidence. The company has clearly figured out how to communicate the benefits of its product while also giving just the right touch of details around the technology behind it all.

And now, the rest of this week’s funding news:

Cultured Meat

New Age Meats – $25 Million: California-based New Age Meats has raised a $25 million series A to help fund product development and ramp up production of its pork sausage products. Founded in 2018, the company hopes to bring its products to market next year as it uses the funds to double its workforce and build a first pilot production plant.

Ghost Kitchens/Virtual Restaurants

All Day Kitchens – $65 Million: Ghost kitchen startup All Day Kitchens announced this last week they’ve raised a $65 million series D to expand its distributed network of satellite kitchens. The company, which launched in 2018, focuses on helping small independent restaurants expand their reach via a unique model; Unlike traditional ghost kitchens with often treat restaurants like a landlord, All Day Kitchens helps to launch its new restaurant partners across its entire network of kitchens in a given metro area.

Plant-Based

Ripple – $60 Million: Pea-protein alt-dairy specialist Ripple has raised a $60 million Series E. Ripple, which basically is to pea milk what Oatly is to oat dairy products, has continued to grow its products ever since its 2015 debut and plans to use the funding to expand into even more new products and markets. While not all pea-protein products from Ripple have succeeded – see our review of the pretty-bad and now discontinued Ripple yogurt here – I’m intrigued to see what new products they bring to market (well, of course, except maybe yogurt).

Food Delivery

Avo – $45 Million: Israel-based food delivery startup has raised a $45 million Series B. Avo, which offers white-label food and consumer products delivery to landlords and employers, says it plans to use the funding to expand into 10 new metro markets over the next year. From the release: Avo’s mission is to deliver everything from groceries and alcohol to electronics and personal care items to millions of people daily. The company’s customizable amenity platform enables residential and commercial customers to obtain everyday items, the same day, without any minimum order size or incurring any delivery fees of any kind. The platform also excludes a tipping fee, as Avo has a full-time salaried team. Stemming from the COVID-19 pandemic, Avo is currently adding a new major market every month – a dramatic increase in growth that has helped drive revenue 1000% over the past two years.

HUNGRY – $21 Million: Chef-powered catering delivery company HUNGRY has raised a $21 million Series C from a mix of athletes, reality TV talent show singers, and the usual mix of corporate venture capital funds. The company, which lets companies cater food from chefs, works with a variety of high-profile chefs such as Tom Colicchi and has claimed it allows chefs to earn up to half a million per year on the HUNGRY platform.

Swiggy – Half a $Bil?: Indian food delivery startup Swiggy is reportedly in talks to raise a $500-$600 million funding round that would value the company at one Oatly ($10 billion). Invesco will likely lead, while others like Softbank will also throw in capital.

10 Minutes Grocery Delivery

Gorillas – $950 Million: Gorillas, the fast-growing, fast-grocery delivery business has raised an eye-popping $950 billion in funding. The news comes even as the company has reportedly decided to stop monkeying around with a US expansion, at least for the time being. According to Business Insider Germany, Gorillas has decided to scale back its US expansion plans outside of New York City and is laying off employees beyond the Big Apple. This funding comes in large part from Delivery Hero as Gorillas continues expansion in as Germany, the United Kingdom, Spain, and France.

Plant-Based Fish

Hooked – €3.8 Million: Sweden’s Hooked has raised €3.8 Million for its plant-based fish products. Like many new alt-protein funding rounds nowadays, Hooked’s with news of a celebrity backer, Swedish music star Danny Saucedo. The company launched its plant-based tuna brand Toonish into retail last month in the Swedish market.

Food Robots

Piestro – $4.7 Million: Piestro, a maker of robotic pizza-making kiosks, has raised just under $4.7 million via equity crowdfunding. The campaign, which the Wavemaker Labs portfolio company ran using StartEngine, will be used to fund the second-generation Piestro, which will be the first pizza robot from the company to be deployed in consumer-facing locations and take payments. The company hopes to have its new prototype deployed by December of this year. Wavemaker Labs, which describes itself as a “robotics and automation corporate innovation studio”, has shown a preference for using platforms such as StartEngine and SeedInvest to raise funds with its portfolio companies like Piestro, Miso Robotics, Future Acres and Bobacino.

Gorillas is Hiring Up to Expand its 10-Minute Grocery to San Francisco, LA and Chicago

As of now, New Yorkers have just about all the fun when it comes to super speedy grocery delivery in the U.S. Companies like Fridge No More, JOKR, Gorillas and, starting next month, Buyk are all building out a network of small, delivery-only grocery stores that promise to deliver your food in as few as ten minutes

But based on its current job listings, Gorillas is prepping to make a move out west. The company is currently hiring the following positions:

Germany-based Gorillas certainly has the cash to fuel such expansion. The company just raised $290 million in March, and has raised $335 million in total. There also currently isn’t that much competition in terms of speedy delivery grocery services on the West Coast. Food Rocket launched 15-minute grocery delivery in San Francisco at the end of May. Gopuff has a number of locations across California (and Chicago), though its delivery times are a comparatively “sluggish” 30 minutes.

Gorillas, like its rivals, operates dark stores in neighborhoods that have a limited delivery radius of typically one to one and a half miles. The economics of that certainly works in densely packed urban areas like New York, Chicago or even San Francisco, but Los Angeles is sprawling (though it does have a ton of people). I’m curious to see which neighborhoods Gorillas will start with and how it will expand.

As I’ve said before, I believe this new crop of speedy delivery services are not the next Kozmo.com’s. and they have the potential to turn grocery shopping into an on-demand utility. There is power in the idea of ordering a pint of ice cream and having it arrive at your doorstep 10 minutes later, and it could upend traditional notions of going to the grocery store in person (moreso than the pandemic did).

We’ll have to wait and see on that front, but in the meantime, one good thing about the Gorillas job openings is that they are all full-time with benefits, even the delivery driver position.

Gorillas is Bringing its 10-Minute Grocery Delivery to the U.S. Next Week

Germany-based Gorillas is launching its speedy grocery delivery service here in the U.S. on May 30. The service will provide on-demand delivery of groceries in 10 minutes or less in New York City, starting in Bushwick, parts of Williamsburg, Downtown Brooklyn, Cobble Hill and Boerum Hill.

Gorillas is part of a new wave of dark, delivery only grocery stores that are set up in dense residential areas. These stores carry fewer items than a supermarket, but because they are embedded in neighborhoods and have a limited delivery radius,they can process and fulfill and deliver orders quickly. A number of these speedy delivery stores have gotten funding throughout 2021, including Weezy in the U.K., Getir in Turkey, and Glovo in Spain. Gorillas has been among the most funded, having raised $335 million.

We are just starting to see this small, speedy, delivery only store model emerge in the U.S. Gopuff raised $1.5 billion this year to expand its 24-hour convenience store-like delivery service. In New York City, Gorillas will face more direct competition from Fridge No More, which operates basically the same type of store in the Williamsburg, Park Slope and Gowanus neighborhoods in Brooklyn.

As we’ve written before, all of these super-fast grocery stores have the potential to change our relationship with grocery shopping. Instead of weekly or twice-weekly trips to the store, getting groceries becomes more like a utility that you turn on whenever you need something at that moment. Snacks, milk, wine, whatever can be brought to your door in less time than it takes to put on your shoes and socks and get in the car.

Of course, this new model will only work in certain locations. It’s no coincidence that both Gorillas and Fridge No more operate in New York City. It’s a dense, urban environment with a lot of potential customers in a small geographic area. Ten-minute delivery wouldn’t work as well in more rural areas where houses are spread out. We’ll also have to watch and see how much equity is a part of these startups’ expansion plans. Will they only be delivering to affluent areas? Will New York City be a patchwork of delivery zones that exclude lower-income neighborhoods?

For it’s launch in NYC, Gorillas is teaming up with the non-profit Rethink Food to collect potential food waste from warehouses and turn it into meals for distribution through other community-based organizations.

Those living in its service areas will be able to try Gorillas out for themselves starting this Sunday. All orders will carry a flat delivery fee of $1.80 and there is no minimum order. Hours of operation at launch will be 8 a.m. to 11 p.m.

Food Tech Show Live: Sony Invests in our Robot Chef Future

The Spoon team recently got together on Clubhouse to talk about some of the most interesting food tech and future food stories of the week. This time around, we were also joined by food tech investor Brian Frank.

If you’d like to join us for the live recording, make sure to follow The Spoon’s Food Tech Live club on Clubhouse, where you’ll find us recording our weekly news review every Friday.

The stories we talked about this week include:

As always, you can find the Food Tech Show on Apple Podcasts, Spotify or wherever you listen to podcasts. You can also download direct or just click play below.

Germany: Gorillas Raises $290 Million for its Dark Grocery Store Chain

Gorillas, which operates a chain of dark grocery stores that offer fast delivery, has raised a $290 million Series B round of funding, according to TechCrunch. The round was led by Coatue Management, DST Global, and Tencent, with Green Oaks, Fifth Wall, Dragoneer, and Atlantic Food Labs also participated. Gorillas raised a $44 million Series A round of funding in December of 2020.

The Berlin-based Gorillas is among a cohort of startups building out small, delivery-only grocery stores deep inside residential neighborhoods. Thess dark stores carry a limited inventory (that can be customized per neighborhood location), and have a limited delivery radius, so orders can be fulfilled and dropped off, usually in less than fifteen minutes. Gorillas currently operates stores in more than 12 cities across Europe including Berlin, Munich, Amsterdam and London.

A funding round this big and this fast following a recent Series A for a grocery related startup is not at all surprising. As noted, Gorillas is just one player in the speedy grocery delivery space. Similar startups in Europe that have recently raised funding include Weezy, Jiffy, and Flink. Here in the U.S., DoorDash is building out a chain of DashMart stores, Fridge No More is making deliveries in New York City, and GoPuff, which delivers many household items in addition to groceries, raised $1.5 billion this week.

As we have written a lot lately, the big question for these stores is whether they can scale. On paper, the ability to get last-minute groceries delivered in just minutes is great. But it also needs a certain population density to make the economics work, and we have yet to see those economics scale on a national level. If Gorillas can use its funding to do so, then it could become, well, an 800 lbs gorilla in the space.

Germany-Based Gorillas Raises $44M for Speedy Grocery Delivery

German grocery delivery startup Gorillas has raised a $44 million Series A round of funding led by hedge fund Coatue, TechCrunch reports.

Gorillas promises super-speedy grocery delivery, with the company saying it averages a delivery time of 10 minutes. It does this by creating smaller, delivery only (or “dark”) grocery stores. These dark stores can be placed in neighborhoods closer to where customers live, and can be engineered to enable faster pick-and-pack orders only, instead of being set up to serve in-store shoppers as well.

The dark store concept is catching on with a lot of startups. Over in the U.K., Weezy promises fast grocery delivery thanks in part to its smaller neighborhood fulfillment centers. Here in the U.S., DoorDash created its own branded dark convenience store, and Fabric‘s automated fulfillment centers are meant to be built into smaller locations.

The global pandemic pushed people into grocery delivery earlier this year. And though sales have dipped from record highs earlier this year, e-grocery continues to be sticky with customers who are ordering more and more often online. Perhaps more importantly, online grocery sales are projected to keep growing and take up 21.5 percent of total grocery sales by 2025, reaching 250 billion dollars.

So it makes sense that we’re seeing a number of companies angling now to get your e-grocery business and hopefully your loyalty as the entire sector grows. And it’s not just startups either. Amazon and Walmart are aggressively touting speedy delivery and offering free grocery delivery as a perk for joining their respective membership services.

For it’s part, Gorillas told TechCrunch that it plans to use its new funding to roll out its service across more cities in Germany and throughout Europe, starting with Amsterdam in the Netherlands.