Amazon is investing $575 million in Deliveroo, a UK online food delivery company, the Financial Times reported. According to the British media, Deliveroo might announce the deal in the next few days.
Amazon declined to comment on the deal. According to the Financial Times, Deliveroo said on Friday that Amazon was the biggest investor in its funding round. Its existing investors including T Rowe Price, Fidelity, and Greenoaks also took part in the funding.
Amazon investing in Deliveroo will help the latter compete with Uber Eats and UK-based Just Eats. The three food delivery startups are mired in a stiff competition to control the UK market.
Deliveroo founder and chief executive Will Shu said, “Amazon has been an inspiration to me personally and to the company, and we look forward to working with such a customer-obsessed organisation.” Deliveroo also said in a statement that it plans to ‘invest heavily’ in its technology team in an effort to build new products. However, Shu said that the company would use the money in the direction to grow and create more choices for its customers.
“We’re impressed with Deliveroo’s approach,” said Doug Gurr, Amazon’s UK country manager. “Will and his team have built an innovative technology and service, and we’re excited to see what they do next.”
Founded in 2013, Deliveroo had a valuation of $2 billion in a funding round two years ago. Last year, it was hoping to achieve a valuation of $4 billion in its talks with Uber, the Financial Times reports.
Deliveroo had doubled its revenue in 2017, and it was the first to launch bricks-and-mortar kitchens where restaurants can cook food for delivery. Thereafter, many competitors have modeled this approach.