Food delivery is an interesting category. It’s not a new concept, but tech has enabled it to be done more efficiently on the consumer end. Lots of startups have popped up in the space in recent years, they’ve become popular among consumers, and many companies have grown extremely fast.
Crunchbase News has written plenty about food delivery companies before, including about how one even managed to make an adjusted profit. But as the year ends, we wanted to take a look at how much venture capital love (i.e. funding) the space had received so far this year.
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A couple of caveats about the data: the numbers focus on venture capital and exclude non-venture funding (private equity, venture debt, grants, etc.) and include companies tagged with “food delivery” in Crunchbase’s data set. It’s possible there’s a lag in reporting funding, so the data may not be perfect, but it’s a pretty good guiding metric. Lastly, Q4 of 2019 isn’t over yet, so it’s possible that food delivery companies could receive a flood of cash in the next month or so and significantly change the funding totals for this quarter and this year.
So far in Q4 this year, food delivery companies have received nearly $387 million in total venture capital funding. That’s significantly less than during the same period last year. Between Oct. 1, 2018 and Nov. 26, 2018, food delivery companies brought in almost $6.2 billion in VC dollars. For all of Q4 2018, food delivery companies received close to $7.3 billion in funding.
That’s pretty different from the situation this year. In 2019 so far, food delivery companies have received around $3.8 billion in funding, which is less than how much companies in the space received in just Q4 of last year. Last year, food delivery companies received around $11 billion in funding over the course of the whole year (it was about $10 billion by Nov.26, 2018), while so far this year, it’s about $3.8 billion.
Colombia’s Rappi had the largest venture capital funding round of food delivery companies in 2019, with the startup bringing in $1 billion in its Series E round. This year has also seen DoorDash pull in huge chunks of cash, with the company raising $1 billion in venture capital this year through its $400 million Series F in February and its $600 million Series G in May.
Food delivery hasn’t been without its fair share of problems and speculation this year: DoorDash came under fire for its tipping practices and we’re still waiting on Postmates to go public.
So while the funding totals for this year lag behind last year, high-profile companies are still pulling in serious cash.
Illustration Credit: Li-Anne Dias