TechCrunch reports that grocery delivery startup Food Rocket made a "funding deal with Alimentation Couche-Tard Inc. that puts its 15-minute grocery delivery service in more than 14,000 Circle K convenience stores and Couche-Tard locations … The new $25 million in Series A investment, led by Alimentation Couche-Tard via its Circle K Venture Fund, will enable Food Rocket to deliver in 26 countries and territories, including more than 7,000 U.S. locations. In all, the company has raised $30 million to date."
According to the story, "Food Rocket uses AI-enabled technologies to manage warehouse stocks, forecast demand and optimize delivery time by predicting the closest store that offers the fastest delivery time and the lowest costs of putting together and delivering the order."
Food Rocket founder and CEO Vitaly Alexandrov tells TechCrunch that it is a partnership that should enable "the company to grow faster and more efficient and be able to reach profitability faster than others. It will also be able to leverage Circle K’s size and scale, consumer insights, marketing expertise, procurement network and supply chain, while Circle K can tap into Food Rocket’s proprietary software for forecasting stock levels and employee workloads.
"Alexandrov also said the funding will be invested into expanding its service in both Chicago — to open around 15 stores there — and San Francisco, and into other cities, including Boston, Philadelphia and Los Angeles. Food Rocket plans to create over 2,000 jobs in new areas and continues to be one of the few startups offering full-time employment to all of its riders, he added.
"In addition, he plans to launch a dark kitchen aspect of the business that will deliver foods that can be prepared in minutes — think coffee, bagels and pizza, that could still be delivered within 15 minutes. He also wants to take a step further eventually and deliver other items like phones."
- KC's View:
It was just two months ago that Circle K signed a deal with online pure-player Farmstead, with the goal of exploring "innovative supply chain, distribution, e-commerce fulfillment and marketing models." So there appears to be a pattern here - Alimentation Couche-Tard positioning itself to be far more competitive in the grocery marketplace, going beyond the traditional lanes occupied by c-stores.
By the way, the "dark kitchen" component of this makes a lot of sense to me - c-stores, if they can up their food game, are well positioned to tap into this trend.
I remain a little skeptical about the while 15-minute promise being made b y so many companies. I think that it does not allow for small problems like traffic, and creates a potential over-promise-and-under-deliver scenario. But my skepticism aside, this seems to be a value proposition of them moment, at least until someone starts offering 10 minute delivery or product teleportation.