Helping merchants of any size out prime Amazon Prime is an emerging business. And it stands to reason. The pandemic has sharply accelerated consumer eCommerce adoption. And it has unleashed thousands of new online merchants into the wild. And those providing the tools that make eCommerce function have experienced their own acceleration.
One such beneficiary is Deliverr, a San Francisco-based company launched in 2017 by Michael Krakaris, just two years after graduating from Northwestern University. And of course, he’s on one of those “30 Under 30” lists.
So Deliverr has a very simple proposition. Its mission is to “democratize fulfillment” by giving merchants of “any size” access to Prime-worthy delivery service.
This week, Deliverr announced a $170 million funding round. This brings its total haul since launch to $240 million. The latest funding round breaks down this way. Coatue led a $135 million in Series D round. And Brookfield Technology Partners, along with existing investors including Activant Capital, 8VC, and GLP., funded a $35 million convertible note.
Any Merchant, Regardless of Size
So this is what Deliverr says in the funding round announcement about its mission.
“Our mission — to enable any merchant, regardless of size, to delight their customers with ultra-fast and cost-effective fulfillment — has become more meaningful than ever in the last year. At the start of the pandemic, day after day we surpassed our all-time highs in order volume, as people depended on online merchants for essentials. We delivered face masks, vitamins, sanitary products and more to millions of households across the U.S.
“It has become clear that the initial spike we saw in online shopping will not subside — eCommerce now makes up more than 20% of total retail sales, up from 15% a year prior, and continues to trend upward. 2020 was our biggest year ever, as Deliverr fulfilled millions of orders through our network — over 6 times more than the year prior.”
We’re not very surprised that investors are bullish on Deliverr, and the space it occupies. Also, $240 million is likely not the end of what a company in the logistics space will need to scale. After all, without companies like Deiverr, smaller merchants would struggle to compete in eCommerce. Amazon Prime has become the de facto fulfillment experience for consumers. And delivering an experience that is clearly subpar is a clear path to failure.
One of Deliverr’s investors echoed this point in the funding announcement.
“Fast delivery is no longer a nice-to-have, with legacy retailers needing to rapidly evolve their eCommerce strategy in order to stay competitive,” said Josh Raffaelli, Managing Partner at Brookfield Technology Partners. “Deliverr’s ability to arm retailers with Prime-like delivery is a game-changer and a big reason why Brookfield, which has extensive relationships across its retail footprint, is thrilled to partner with Deliverr.”
A Curated Walmart Partner
Localogy Insider reported yesterday that eCommerce SaaS player BigCommerce and retail giant Walmart have partnered to improve their respective eCommerce offerings and better compete with Amazon. For a while now, Walmart has been shaping into Amazon’s leading online retail rival. Here is what my colleague Mike Boland wrote about that deal.
“[BigCommerce’s] merchants will get additional distribution on Walmart’s online marketplace. That includes access and exposure to 120 million monthly active users who shop on Walmart.com.
“The way this will work is that BigCommerce merchants have the choice to opt in to Walmart.com distribution. If the additional scale isn’t incentive enough, BigCommerce merchants will get their standard e-commerce fees and revenue-share waived for the first month that they’re active on Walmart.com.”
We also found this recent Chain Store Age article, showing Deliverr as one of Walmart’s “curated” partners for fulfillment.
Starting Wednesday, Feb. 24, Walmart Marketplace is available as a new channel on BigCommerce. By activating the Walmart Marketplace channel, U.S. retailers will be able to track products, orders, inventory and fulfillment from one central location. They will also gain access to a curated network of complementary partners. These include CedCommerce, Codisto Channel Cloud, Feedonomics, SureDone, Zentail, Tinuiti, Teikametrics, and Deliverr – to support their listing, order and inventory management, advertising and fulfillment needs.
Now, what happens with all that money? Deliverr says it will invest the new funding in building out its logistics platform.
“We plan on rapidly expanding our next-day delivery coverage across the country, providing an excellent, Prime-like customer experience for our merchants,” the company said. “Moreover, we plan on growing our existing network of 50 warehouses. And launch new fast shipping programs with leading sales and marketing channels.”