On-demand delivery service GoPuff announced today it has acquired fleet management company rideOS, with TechCrunch also reporting a $115 million price tag for the deal after speaking with sources familiar with the matter.
GoPuff, which raised $1.5 billion this past March, operates a delivery service that can fulfill orders — anything from food to baby products to alcohol — in 30 minutes or less, 24/7. To do this, the company operates micro-fulfillment centers in residential areas of cities. The company currently has these centers in over 650 U.S. cities.
As it grows both the number of markets in which it operates as well as the number of fulfillment centers in each city, GoPuff will need to further optimize its delivery operations and tech, which is where rideOS comes into play. For GoPuff, the rideOS deal means access to the latter’s proprietary delivery, routing, and logistics technology as well as the expertise to build new technologies that can further reduce delivery times and enable new modes of delivery.
GoPuff acquired alcohol retailer BevMo for $350 million in 2020 and the U.K.’s Fancy Delivery in May of this year.
The rideOS acquisition comes at a time when on-demand delivery startups are raking in the investment dollars and expanding services. Currently, that list includes Weezy, Glovo, and Getir in Europe, and Food Rocket, Fridge No More, Gorillas and JOKR in the U.S.
The concept will realistically only work in dense residential areas, where micro-fulfillment centers can be located within blocks of customers. Receiving an order, fulfilling it, and delivering it in under 30 minutes to a customer in suburban or rural areas seems less feasible given the greater distances couriers must travel. That means large swaths of the U.S. will likely never see extensive implementations of these services, while competition will increase in more concentrated urban areas.
GoPuff acquiring a fleet-management software platform could give the company a strategic edge in terms of being able to optimize routes for delivery, decrease fulfillment times, and possibly even handle more inventory.
GoPuff said it expects to “significantly increase” headcount by the end of the year and expand its presence in Silicon Valley, Pittsburgh, and Berlin.
