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Philadelphia startup GoPuff, founded by Drexel grads, raises $1 billion

Joseph N. DiStefano, The Philadelphia Inquirer on

Published in Science & Technology News

GoBrands, the Philadelphia-based delivery company that wants its GoPuff warehouse and delivery service to replace student runs to Wawa, beer and CBD stores, has raised $750 million plus a pledge of $250 million more if it does well this year, according to two people close to the company.

The investment round was led by the Japanese-run, Saudi Arabia government-funded Softbank Vision Fund, the people said.

That kind of money would enable GoPuff to accelerate its growth against rivals including other venture-backed startups, as well as giants such as Amazon Prime and Uber Eats.

The billion-dollar bet by Softbank Vision and another venture capital firm, Accel Partners, was first reported Friday by The Information, a San Francisco-based, subscriber-funded news service, citing unnamed sources.

GoBrands did not offer any comments, and SoftBank has not publicly named GoBrands among its investments.

Accel, a Silicon Valley firm that backed GoBrands in a smaller, earlier funding round, has a history with delivery start-ups: Accel also backed Bucknell grad Marc Lore's Quidsi delivery service, which was purchased by Amazon in 2010 for more than $500 million, and Lore's warehouse-delivery service Jet.com, bought by Walmart in 2016 for more than $3 billion.

 

That build-local, sell-to-giants model, if successful, could make GoPuff's investors rich alongside its founders, Drexel grads Yakir Gola and Rafael Ilishayev.

The Softbank and Accel-led investment would make GoBrands among the best-funded Philly software startups in recent history. SoftBank Vision is also an investor in Fanatics, Conshohocken-based investor Michael Rubin's sports-gear supplier, among many other retail-tech firms.

For SoftBank, which is used to betting billions, going heavy on GoBrands looks like a hedge on earlier bets: SoftBank has also invested in GoPuff's food service rival DoorDash, notes Bob Moul, a veteran Philadelphia area tech CEO (he now heads data-intelligence start-up Circonus) and a close observer of the Philly venture-capital scene.

Along with successful investments such as China's AliBaba and promising ones such as Uber and Fanatics, SoftBank has made some famously bad bets, writing down $4.6 billion in valuation losses last year on office-sublet company WeWork, now called The We Company.

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