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Delivery Hero raises another $88 million in funding

The company raised big rounds in each of the last three years, with total funding of nearly $200M

Financial trends and news by Steven Loeb
January 13, 2014 | Comments
Short URL: http://vator.tv/n/3454

Oh, online food delivery websites. If the Internet suddenly shut off forever tomorrow, and never came back, I would miss you most of all. I would miss the countless Sundays when the pizza I ordered from you was the only reason I had to put on pants. I would definitely long for the rainy and snowy (back when I was on the east coast) days when I knew that I would remain safe from anything wet because you were there waiting for me.

The only problem I can see with online food delivery at this point, in fact, is picking the right one. I typically use GrubHub because they have the absolute best customer service I have ever experienced. (My food has been only five minutes late and they have still given me a discount). But the food delivery space is an especially crowded one, with big companies like GrubHub and Seamless fighting it out with newcomers like Eat Club and PlateJoy 

One company that has proven especially enticing to investors, though, is Delivery Hero. It has now raised a big funding round for the third year in a row.

The company has raised a Series E round financing of $88 million, it was announced on Monday, with Insight Venture Partners leading the round.

This new round comes only six months after it raised $30 million from Phenomen Ventures and other unnamed institutional investors in July of 2013, which came less a year after it raised $50 million from Kite Ventures and Kreos Capital in August of 2012.

The company has now raised close to $200 million in total funding. It says that the new money will put toward its efforts "to fuel growth in its existing markets and expanding its position as an innovation leader." 

VatorNews has reached out to Delivery Hero to get a better idea of what that means, and will update this story once we learn more.

Founded in 2010, the Berlin-based Delivery Hero now serves 55,000 restaurants in 14 countries including Germany, Sweden, UK, Korea, China and India. It is used by 6 million customers, and it says that its revenue doubled in 2013, making the company profitable for the first time.

“Delivery Hero has a strong market position globally and we looked for an investor that could add to our ambitious vision," Niklas Östberg, CEO of Delivery Hero, said in a statement,

"Insight Venture Partners has experience with marketplace businesses that are expanding internationally, and we believe their capabilities marry well with our long term vision.”

Food delivery space

As I said earlier, the food delivery space has seen many company receive funding over the last few years. 

In April of 2012 Just-Eat raised $64 million round is its biggest yet, and brings the total amount raised for the company to $129.4 million. Then, in November of 2012, Fresh Dish, a subscription meal delivery service launched with $500,000 from Battery Ventures.

Last year saw Eat Club raise $5 million in a Series A round led by August Capital, and then Relay Foods raised $8.25 million from unnamed investors, in April. 

In May of last year, Rocket Internet’s FoodPanda raised $20 million from AB Kinnevik and Phenomen.

Yelp also decided to get into the food delivery business as well, launching Yelp Platform in July. It allows users to connect with local businesses and buy directly from them online. The first category on the Platform was food, where users could have it either delivered or can go pick it up themselves.

But the biggest news in food delivery last year was not a funding story, but the merger of two of the biggest companies. 

Back in May, GrubHub and Seamless combined to create one giant mega food ordering service, later named, what else, Grubhub Seamless. 

The merger gave Seamless access to GrubHub’s user base and technology, while GrubHub gained access to Seamless’s strong base in many of the larger U.S. cities.

(Image source: http://www.deliveryhero.com)


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