The three main players have, in just the last few years, recorded millions of dollars in funding, but also in losses.
The food delivery app war in Singapore is heating up. The three main players – Deliveroo, Foodpanda and UberEATS – have, in just the last few years, recorded millions of dollars in funding – but also in losses – as they invest in promotions, technologies and even real estate to win the food fight.
London-based Deliveroo in September announced that it has raised a record US$385 million in Series F funding, giving it a valuation of over US$2 billion and helping it compete better with publicly traded rivals such as Delivery Hero (which acquired Foodpanda in 2016) and the world’s most valuable unicorn, Uber (which runs UberEATS).
Foodpanda, which is based in Berlin and backed by startup incubator Rocket Internet, had raised some US$318 million in funding before its acquisition by Delivery Hero, which has a market cap of 6.65 billion euros (S$10.6 billion) today.
UberEATS, based in San Francisco, enjoys Uber’s funding war chest of over US$11.56 billion and reported valuation of nearly US$70 billion.
Notably, these food delivery apps are incurring losses and could continue to do so in the next few years as they focus on customer acquisition – a most costly undertaking which usually involves aggressive promotions and unsustainable discount deals – as opposed to profits.
Asked how it plans to dominate the food delivery space here, Deliveroo’s Mr Shanker, said: “Our focus is on delivering the most-loved food, with the best service for both consumers and restaurants. We have invested heavily in technology, like our new despatch algorithm tool, Frank, which has reduced service times by 15 per cent.”
