Delivery of just about everything became mainstream during the pandemic, and has rapidly evolved to include the so-called ultrafast delivery. But now that market is faltering.
Buyk, a New York-based 15-minute delivery service that delivered groceries and essential items, filed Chapter 11 earlier in March after ending operations in its 39 stores in New York City and Chicago. Manhattan-based instant grocery delivery startup 1520 closed up shop in December after less than a year. Meanwhile, Fridge No More, a Brooklyn-based service delivering groceries in New York City and Boston, has also shut down business “due to growing competition and other industry related issues,” the company tweeted March 11.
Venture capitalists invested nearly $4 billion in the ultrafast global delivery market in 2021, up from $500 million the year before, according to data from PitchBook, a market research firm. But now investors’ appetite for unprofitable delivery companies has waned, and they are looking for a clearer path of profitability in anticipation of higher interest rates. On March 24, Instacart said that it had cut its valuation by almost 40%, to $24 billion.
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Originally published on Quartz : Original article