Grocery and takeout delivery startup companies are growing in popularity as most restaurant menu items can be delivered to one’s home. The COVID-19 pandemic has reiterated the essential service these businesses provide for customers and restaurants. One takeout delivery startup app company, Deliveroo, recently revealed that it will be going public on the London Stock Exchange, or LSE.
About the Business
Founded in 2013 by Will Shu, Deliveroo is an ecommerce delivery startup and app company that primarily operates in the United Kingdom (UK). The idea behind the business came when Shu moved to London and discovered a variety of restaurants, but only a few of them actually delivered. The startup app company has 10 core values that all incorporate the idea of working together to create a positive experience for customers, restaurants, and Deliveroo staff.
According to Deliveroo’s website, due to the “Frank” technology created by the app business, the startup has been able to cut delivery times by 20%. The reduced delivery time has increased the number of deliveries and earnings for delivery riders as well as sales for restaurants. As a business bonus, customers receive their food faster. Restaurants like Five Guys, KFC, Pho, Wagamama, PizzaExpress, and Byron, among others, all use the service provided by the startup app company.
To date, Deliveroo has been able to raise $1.7 billion in financing across several funding rounds, with many different investors, such as Amazon, Fidelity Management & Research Company, Accel, and Durable Capital Partners.
Today it was revealed the startup app company would be going public through an IPO, or initial public offering, on the LSE.
$1.4 Billion IPO
Deliveroo announced at the beginning of March that the business had selected London as the host for a future public listing, as the startup app company has created 47,000 jobs in the city since launching in 2013.
At the time, Deliveroo founder and CEO Will Shu said, “...At Deliveroo we want to be the definitive food company, bringing consumers the best choice of foods, giving restaurants new opportunities to grow their businesses, and providing riders with great work. We are always focused on developing the best proposition for consumers, restaurants and riders and look forward to bringing our service to new parts of the UK as we continue to grow.”
It was confirmed early today that the company will officially be going public. The delivery app business will be selling $1.4 billion worth of shares. According to CNBC, Deliveroo was valued at $7 billion in July, but with the new IPO, the valuation could increase to around $10 billion.
Deliveroo will have two classes of shares, with Shu being the sole holder of “class B” stock, and his shares will account for 20 votes per share. Other shares remain as one vote per share.
The news of the IPO comes one week after Deliveroo revealed it lost $310 million last year, despite a 54% growth in sales.
McKenzie Carpenter is a graduate of Central Michigan University with a B.A.A. in Integrative Public Relations and French. McKenzie has previously worked for small businesses and nonprofit organizations.