Deliveroo, the London-based food delivery company, has raised $180 million in a funding round led by Fidelity Management and Research Company. The funding round, which also included participation from existing investors Durable Capital Partners and Amazon, values Deliveroo at $7 billion.
This latest funding round comes as Deliveroo has seen a surge in demand for its services during the COVID-19 pandemic. With restaurants closed or limited to takeout and delivery, more people have turned to food delivery services like Deliveroo to get their meals.
Deliveroo plans to use the new funding to expand its services globally, particularly in Europe, the Middle East, and Asia. The company currently operates in 12 countries, including the UK, Australia, and Spain.
One of the ways Deliveroo plans to expand is by partnering with more restaurants. The company already has partnerships with over 140,000 restaurants worldwide, but it plans to add even more to its platform.
Deliveroo also plans to invest in technology and innovation. The company has already developed its own delivery-only kitchens, called Editions, which allow restaurants to expand their reach without opening a physical location. Deliveroo plans to expand its Editions concept to more cities around the world.
While Deliveroo has seen a surge in demand during the pandemic, it still faces challenges. One of the biggest challenges is competition from other food delivery companies like Uber Eats and Just Eat.
Deliveroo also faces regulatory challenges in some markets. In the UK, for example, the company has faced criticism over its treatment of delivery drivers. Some drivers have complained that they are not paid enough and do not receive benefits like sick pay or holiday pay.
Deliveroo has responded to these criticisms by announcing plans to offer its drivers benefits like sick pay and accident insurance. The company has also launched a new feature called “Thank You” that allows customers to tip their delivery drivers.
The Future of Food Delivery
The COVID-19 pandemic has accelerated the shift towards online food delivery, and companies like Deliveroo are well-positioned to take advantage of this trend. With its new funding, Deliveroo is poised to expand its services and compete with other food delivery companies around the world.
However, the future of food delivery is not without its challenges. As more people turn to food delivery services, there are concerns about the impact on the restaurant industry. Some restaurants have complained that food delivery companies charge high fees that eat into their profits.
There are also concerns about the environmental impact of food delivery. Deliveroo and other food delivery companies rely on a fleet of delivery drivers who use cars and motorcycles to transport food. This can contribute to air pollution and traffic congestion in cities.
Despite these challenges, the demand for food delivery services is unlikely to go away anytime soon. As more people work from home and avoid crowded restaurants, food delivery will continue to be a popular option for getting meals.
Deliveroo’s latest funding round is a sign of the company’s continued growth and success in the food delivery market. With its new funding, Deliveroo plans to expand its services globally and invest in technology and innovation.
However, Deliveroo still faces challenges from competitors and regulatory issues in some markets. The future of food delivery is also uncertain, with concerns about the impact on the restaurant industry and the environment.
Despite these challenges, Deliveroo and other food delivery companies are likely to continue to grow as more people turn to online food delivery as a convenient and safe way to get their meals.