Amazon makes new investment in Deliveroo food courier business. Online giant Amazon made the announcement recently. Although the exact amount is unknown but so far amazon is Deliveroo’s biggest investor.
Deliveroo released a statement saying it would use the money for international expansion, improving its service and to grow its delivery-only kitchens business. Deliveroo conducted a fundraising to a total of $575m. This totals to $1.5bn invested in Deliveroo since it was founded in 2013 and the company is one of Europe’s fastest growing technology companies.
Deliveroo founder and chief executive Will Shuu says he is looking forward to working with “such a customer-obsessed organization” like Amazon. Amazon says the innovative technology service of Deliveroo is the reason it is interested in the business.
With Amazon’s investment in Deliveroo, it gives the company a great boost against its biggest competitor Uber Eats.
In 2016, Amazon flagged its own UK food delivery venture, Amazon Restaurants UK but closed just two years later.
“They [Amazon] weren’t able to compete within the market so they’ve gone for the buying option instead. They’ve got the money behind them to do that,” Louise Dudley, fund manager at investment firm Hermes, told the BBC’s Today programme.
“It [Deliveroo] is not just a food delivery company it’s very much a tech company. They have this tech platform that is seen is very attractive. They are able to expand into new areas and think about how people’s tastes are evolving and be able to predict what stores will be successful. That predictive growth is very attractive to Amazon”.
The investment in Deliveroo came after the attempt for an outright buy. Deliveroo currently operates in more than 100 towns and cities across the UK and delivers food from a wide variety of restaurants.
The co-founder of Deliveroo , Will Shu came up with the idea for the firm after moving from new York to London as a banking analyst. He saw the gap during the time he worked long hours and hardly found a food delivery service to use: a service he was used to in the US.
The firm’s founder used to deliver the food himself during the early days while the co-founder who has since left the business developed the booking technology from the US.
Deliveroo currently operates in the UK, Australia, Belgium, France, Germany, Hong Kong, Italy, Ireland, Netherlands, Singapore, Spain, United Arab Emirates and Taiwan. Global sales at the firm has more than doubled in 2017 as much as its losses continued to increase.
The firm uses more than 60,000 couriers mostly bikes or moped to carry out its delivery.
Deliveroo does not employ its riders directly but pays them per delivery.
Last year, a group of 50 UK Deliveroo couriers won a six-figure payout after claiming they had been unlawfully denied holiday and minimum wages.