Grocery Delivery Company Kolonial Rebrands as Oda After Raising $265 Million

By Mariliana Fotopoulou Thursday, April 8, 2021

Norway-based grocery delivery startup Oda, previously known as Kolonial, raised €223 million ($265 million) in a new funding round led by tech-focused investment giants SoftBank and Prosus.

A delivery courier handing off groceries.

Plans to Expand into Finland and Germany

Following the latest funding round, the startup company reached a business valuation of €750 million ($891.8 million), marking one of the largest-ever financing rounds for a Norway-based startup company.

Last year, Oda grew by 100% and garnered €200 million ($237.8 million) in business revenues. The startup company currently represents 70% of the online grocery delivery market in the country.

Karl Munthe-Kaas, chief executive of the grocery delivery business, claims his startup company has established the most operationally efficient warehouse system in the world, with more than 212 UPH (average units processed per labor hour), far ahead of its competitors.

“We’ve reached unprecedented levels of efficiency. And that entirely changes the ball game,” he said.

At the moment, the business holds around seven thousand goods in stock, which is similar to a physical supermarket. Customers can also choose between the same-day and next-day delivery, while charging fees up to €6 ($7.13). Oda customers on average spend roughly €119 ($141.50) per order.

As a result, the startup company is comparable to other online grocery delivery companies in Europe, such as Sweden’s MatHem, Picnic in the Netherlands, and Rohlik from the Czech Republic. Just like its rivals, the online grocery business is also fighting for its market share of traditional supermarkets and discounters.

Online grocery delivery sector in Norway represents just 1.5% of the entire grocery market, compared to the United Kingdom (UK) where online grocery accounts for 13%, and France with 7%.

Grocery delivery companies have been struggling to lure more customers to online shopping as most of them still offer in-store picking and packing in-store, which proved to be very inefficient. Munthe-Kaas says that this approach has about three times smaller operational efficiency than Oda’s model.

“Having all that volume in one spot makes the upstream extremely efficient. Produce comes directly from farms, so nothing has time to expire. The supply chain is shorter so there’s less than 0.5% waste.”

The startup company plans to use the new proceeds to expand in Finland by the end of 2021 and is already building its first warehouse there. Oda also wants to expand into Germany next year and is holding talks with suppliers from those two countries.

Just like at home, Oda will provide services to its customers who live within a two-hour driving radius of its warehouses. Munthe-Kaas said that is one of the reasons why Germany is a very appealing market, apart from its grocery sector being worth about €200 billion ($237.8 million).

“Germany is fantastic because it has a uniformly distributed population. With one warehouse you can easily cover five, six, seven million people. That’s two or three times more people than we cover from our warehouse in Norway,” Munthe-Kaas said.

Summary

Grocery delivery business Oda raised €223 million ($265 million) in fresh funding led by SoftBank and Prosus to hit a post-money valuation of €750 million ($891.8 million).

About the Author


Headshot of Mariliana Fotopoulou

Mariliana has an MSC in Consumer Analytics and Business Strategy. She has a special interest in fast-moving industries and Big Data.

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