Grocery delivery start up shuts down after burning through $11m in 8 months.
Reported on news.com.au Australian online grocery delivery start-up Voly appears to have abruptly shut down, leaving customers trying to place orders completely in the dark. The company based in Sydney with warehouses in Crows Nest, Manly, Maroubra and Alexandria, which raised $18 million in funding at the end of 2021, suddenly began displaying a “closed until further notice” message to users of its app on Friday. Social media accounts for the brand, including on Facebook, Instagram and Twitter, have been closed down with no explanation.
Launching in July 2021 with the promise of grocery delivery 15 minutes or less it didn’t take them long to start laying off staff with the first round occurring in June with half their office staff being let go and then again last week. While the brand sold itself on the promise of groceries delivered in 15 minutes or less, delivery times were extended to 20 minutes and plans to expand into Melbourne were paused indefinitely.
It was understood the sector was struggling to compete with supermarket giants Woolworths and Coles. The start-up – founded by Mark Heath and Thibault Henry – delivered to about 42 suburbs. The duo told staff earlier this year the business had enough funding to see it through until February 2023. Mr Heath last week confirmed more staff had been let go, but he could not “comment further because we’re engaged in a couple of transactions”, the Australian Financial Review reported. Voly’s trouble comes after the collapse of rival service, Send, which went into voluntary administration less than 12 months after launching.
An administrator’s report revealed the start-up had burned through a whopping $11 million in just eight months. Another outfit called Quicko, which promised deliveries within two hours, also went under in mid-March.
Meanwhile, in June, the $75 million-backed grocery delivery start-up Milkrun sent out an astonishing email to customers apologising if they feel “let down” by it, which its CEO said could include late delivery or poor service. Leaked investor pitch documents obtained by The Sydney Morning Herald and The Age show that Milkrun, one of Australia’s most feted startup businesses, was as recently as March losing about $13 per order at one of its best locations. In the documents and commentary Milkrun says it is generating more than $4 million in revenue each month and is aiming to hit the annualised equivalent of $100 million in revenue by the end of 2022.
