Hyperlocal delivery startup Grofers
is in talks to buy Bengaluru based SpoonJoy, as the food ordering app struggles
to raise money from new and existing investors. Grofers, run by Locodel
Solutions Pvt. Ltd, is expected to sign a acqui-hire deal with SpoonJoy.
Operations of SpoonJoy will be shut down once the deal is done.
As investor interest starts to ebb
in the crowded food ordering sector, the market is expected to see more such
consolidation or strategic investments. Since the start of the year, investors
have pumped $150 Million into 20 food ordering startups. The acquisition of
SpoonJoy is expected to largely to be a stock deal with some component of cash
being involved.
About 40 people from SpoonJoy are
expected to join Grofers in the tech and operations departments. SpoonJoy was
launched in July 2014 by IIT graduates. The company is backed by Flipkart
co-founders Sachin Bansal and Binny Bansal. In May, the company raised $1
Million in a Series A funding from SAIF Partners.
There are early signs of a slowdown
and startups in overcrowded sectors will either fail to get higher valuations
in their next rounds or not find fresh funds, leading to cost cuts and
consolidation over the next one year. However, Food tech companies will not
disappear, given the large markets for home deliveries in large cities.
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