Online food delivery is seeing more consolidation as GrubMarket, a B2B powerhouse in produce and grocery logistics, has acquired Good Eggs, a fresh food delivery startup that struggled in recent times. The terms of the deal, which was a stock transaction, remain undisclosed but GrubMarket’s valuation was marginally higher than Good Eggs’ last valuation of $22 million.
Good Eggs will now be led by Keith Brewer, the COO of GrubMarket-owned Daylight Foods. While some Good Eggs staff will transition to GrubMarket, the future of Rodrigo Arevalo, Good Eggs’ current CEO, is uncertain. This acquisition signifies a shift in investor sentiment towards unprofitable startups, as Good Eggs, once valued at $365 million, saw a drastic devaluation to $22 million post-COVID-19.
In contrast, GrubMarket has a valuation of $3.5 billion and has raised over $560 million. The company, eyeing an IPO, is focused on its B2B strategy, with a potential for more financing announcements. GrubMarket’s success in the grocery logistics space contrasts with Good Eggs’ struggles, showcasing the varying outcomes in the industry.
Both companies started in consumer delivery but GrubMarket’s pivot to B2B, serving major clients like Whole Foods and Walmart, has led to profitability through strategic acquisitions and strong relationships with suppliers. CEO Mike Xu emphasizes profitability as a core value, with a focus on sustainable growth. The acquisition of Good Eggs is seen as an optimistic move to leverage GrubMarket’s scale in exploring B2C opportunities again.
The volatile landscape for grocery delivery startups has seen challenges for players like Getir, while GrubMarket emerges as a consolidator to improve efficiency. Instacart’s upcoming earnings may set the tone for the industry’s performance moving forward.
