Wolt, Finland’s answer to DoorDash, was on a steep trajectory before COVID. The pandemic has acted like a catapult for the company. So much so that Wolt has just raised a whopping $530 million. This despite having more than $100 million of cash on hand from earlier funding rounds.
Wolt has raised $662 million over the past year and $856 million since the company launched in 2015, serving just 10 restaurants in Helsinki. One of last year’s investors was Lukasz Gadowski, co-founder of German-based DeliveryHero, which operates a network of local delivery brands worldwide. The latest funding round was led by ICONIQ Growth.
Wolt isn’t exactly a household name in North America, but it has become a global force in the delivery space. The company currently operates in 129 cities around the world and has relationships with 30,000 restaurants.
In 2020, Wolt seized the moment and leaned into the opportunities the pandemic presented. The company expanded its business into delivering groceries and other essentials. It has formed relationships with more than 1,500 grocery retailers thus far, on top of its network of restaurants.
As a result, the company more than tripled its revenue in 2020 to $345 million. It did generate a net loss of $45 million for the year. Wolt has so much cash on hand from raising nearly a billion since launch that it has ample dry powder to invest in people, product development, distribution, time to think about where to take the business. Whatever it needs.
Last year the company had 700 people in 20 countries. Now it has 2,200 people in 23 countries. Wolt is reportedly preparing for an IPO.
“We raised this round of financing to further strengthen our balance sheet, allowing us to think long-term and double down on building even stronger positions across our markets while continuing to expand our offering beyond the restaurant,” Miki Kuusi, CEO & co-founder of Wolt said in a statement.
Taking on Amazon, Alibaba
Wolt describes itself as a technology company. Not a logistics or an eCommerce company. And it has ambitions to be much more than the euro version of DoorDash, which recently raised $3.3 billion in its own IPO. In a recent interview, Wolt’s Co-founder and EO Miki Kuusi said the company’s true ambition is to become an eCommerce enabler for small businesses.
“The opportunity is to equip brick and mortar stores to compete with Amazon and Alibaba — and be better than them,” Kuusi said in the interview.
However, the company only just added grocery delivery last year. It says it wants to master that craft before turning its turret toward the broader retail market.
However, Wolt doesn’t appear to be going after the eCommerce giants via the “dark store” approach. A dark store is basically the retail version of a “cloud kitchen.” It’s a store that has one customer class. Delivery apps.
Another European player, Glovo, has gone down this path. The Spanish company recently invested more than $120 million in dark stores as part of an effort to own the local delivery space. Wolt plans to stick with its strategy of working with established retail partners.
Of course, when you think of it, Amazon’s warehouses are kind of a vertically integrated version of the dark store.
