GoPuff, a Philadelphia-based digital delivery company, announced Tuesday it raised $1.15 billion in a Series G round led by an existing investor, D1 Capital Partners. Other investors include Fidelity Management and Research Co., Baillie Gifford, Reinvent Capital, Luxor Capital and SoftBank Vision Fund 1. The grocery delivery platform has raised a total of $2.4 billion and is now valued at $8.9 billion.
Co-founders and co-CEOs Rafael Ilishayev and Yakir Gola created the platform in 2013 while attending Drexel University in Philadelphia as a way to conveniently order everyday products. Unlike many delivery applications, goPuff took a vertically integrated approach that allows them to control inventory and fulfillment processes.
The company buys products directly from a manufacturer and distributes those goods throughout more than 250 micro-fulfillment centers. With its contracted driver network and a flat fee of $1.95, goPuff promises 30-minute delivery 24/7. In November, the company acquired the chain BevMo!, adding 160 alcoholic beverage stores to their network.
“GoPuff is truly in a league of its own. We believe that the company’s vision and differentiated model drive industry-leading economics and sustainable growth,” said Daniel Sundheim, founder and CIO at D1 Capital Partners, in the release. “Since we initially invested in goPuff last fall, we have been consistently impressed by the team’s ability to successfully execute against its growth plans. The company’s potential is tremendous, and we look forward to the unique opportunities that lie ahead.”
GoPuff is available in more than 650 cities and plans to use the funds to continue U.S. expansion and to enter international markets. The company will focus on adding to its product catalog and has recently launched categories including “better for you,” beauty and baby. It has also created “curated mystery boxes,” a recent trend that gives consumers a way to shop their for favorite brands with remarkable savings and gives retailers a way to offload excess inventory.
“We’re actually seeing the fastest year-over-year growth in these new innovative categories rather than kind of the traditional core goPuff categories that we launched with,” said Ilishayev in an interview with CNBC.
The company has also launched goPuff Marketing Solutions to help brands run media campaigns both on and off goPuff’s platform. This solution will enable goPuff brands to meet repeatable and predictive ROI for long-term growth.
“GoPuff’s proven business model has yielded strong, sustainable results in growing and developing a new category of instant needs that it continues to define,” said Chris Evdaimon, investment manager at Baillie Gifford. “We are thrilled to support goPuff as the company expands its market position and propels itself to new heights.”