Wolt, the Finnish food delivery app start-up, just raised $530 million in a financing round led by ICONIQ Growth.
The company which already operates in 23 countries and has some 700 employees plans to use the funds to speed up its retail delivery services.
Wolt has been steadily expanding its network of retailers and seems to be prepping for an IPO as well.
In 2019, Wolt reported a turnover of over €87 million delivering food across 129 cities. Revenues were even higher in 2020 ($345 million).
It’s not the only company looking to expand from food delivery into the grocery sector. Plenty of delivery companies have made the move. So what’s driving them?
The COVID pandemic has undoubtedly had an influence as a growing number of consumers began to order their groceries online and with supermarkets running out of delivery slots fast it’s a prime opportunity for food delivery apps to jump in to fill the gap.
Wolt is looking to expand its logistics network to deliver medicines, pet foods and even cosmetics eventually.
It hopes to allow smaller stores to compete more effectively with heavyweights like Amazon by making the move. But the company admitted that grocery is a difficult battle field because the margins are relatively narrow.
Among its existing retail partners are grocery store chains Spar and Carrefour. Together with them, Wotl looks to set up small local delivery chains for now and later branch out int more complicated orders.
It remains to be seen how the app can stack up against competitors in this space, but as the first half of the year is shaping up to continue with lockdowns Wolt stands a good chance.