Earlier this year, two of the biggest food delivery companies, Grubhub and Seamless, combined to form one big giant company called, fittingly and conveniently, Grubhub Seamless.
Now comes the inevitable bad part: consolidation. Specifically, that means the closing down of its office in Salt Lake City, it has been confirmed to VatorNews.
"GrubHub Seamless is transferring all Salt Lake City functions to our New York and Chicago offices and will be closing the Utah office by the end of 2014. We have offered relocation packages, and it is our hope that Utah employees consider transferring to Chicago or New York," a Grubhub Seamless spokesperson said.
"Given our high rate of growth, closing an office was a very difficult decision. We believe the consolidation of office locations allows GrubHub Seamless to more effectively serve diners and restaurants while positioning the company for continued growth."
The move will affect 100 employees, and the spokesperson noted that the company is"still aggressively hiring out of our Chicago and New York offices."
It should be noted that these two companies have deep roots in these two cities: Seamless was founded in New York, while GrubHub was founded in Chicago.
In a memo from Matt Maloney, CEO of GrubHub Seamless, to employees that was obtained by VentureBeat, which first reported this news on Friday, he explained the rationale behind the decision.
"For our tech team, we made the decision to move to a single technology platform to optimize for scalability and organizational focus. We will be housing these Java/Open Source skills in NY and Chicago, where we can co-locate with product. For operations and care, we will be consolidating the functions in Chicago," he said.
"Fundamentally, this decision was based on efficiency of workflow and systems – not people."
As per the deal to merge in May, Maloney , the co-founder and CEO of GrubHub, became the company’s CEO, while Seamless CEO Jonathan Zabusky became President.
GrubHub’s President, Mike Evans, became the combined company’s Chief Operating Officer, while GrubHub CFO Adam DeWitt remained in place as the combined company’s CFO. Seamless CIO Sanjay Tiwary will be the new company’s CIO.
By combining, Seamless was able to gain access to GrubHub’s user base and technology, while GrubHub was able to tap into Seamless’s strong base in many of the larger U.S. cities.
In 2012, the two companies generated a combined $875 million in gross food sales, resulting in over $100 million in revenue.
Online food delivery is a space with a lot of money flowing into it lately, and a lot of competition. There have been numerous companies that have raised money over the last couple of years.
Last year, subscription meal delivery service Fresh Dish launched with $500,000, while UK-based online food ordering site, Just-Eat, picked up $64 million round, a year after raising a venture round of $48 million.m AB Kinnevik and Phenomen.
(Image source: http://www.metro.us)