LONDON, May 7 (Reuters Breakingviews) - Concise insights on global finance.
GOTOUGH. The British grocery business is getting a bit more chaotic. GoPuff, a $9 billion SoftBank-backed (9984.T) U.S. rapid delivery start-up, made its first lunge across the Atlantic, buying UK-based delivery rival Fancy for an undisclosed price. Promising to deliver goods in 20 minutes or less, the “rapid grocery” delivery sector has drawn over $8 billion of venture capital cash this year, according to PitchBook.
The money is primarily destined for warehouses and sourcing products directly from suppliers like Reckitt Benckiser (RKT.L), which are then sold at hefty markups. The business model still needs proving, and the competition is fierce . There are at least 10 delivery players operating in Europe, plus Uber Technologies (UBER.N) and supermarkets. DoorDash (DASH.N) and Amazon.com (AMZN.O) are prowling Europe for potential acquisitions too. GoPuff’s Fancy deal is a mere appetiser for what’s to come. (By Karen Kwok)
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