It feels like the zombie-like resurgence of Urban Fetch and Kozmo from the late 90s, but delivering stuff to your house, like right now, is so hot… right now. Thus SF startup PostMates is trying to crack the model locally, while big guys like Amazon Prime and eBay poise to try to hoover it all up nationally. But there’s one player that today reveals its hand and has a platform interesting enough to attract the attention of an outfit that understands how to deliver stuff: UPS. Thus, UK-based Shutl, has secured a $2 million investment from the UPS Strategic Enterprise Fund, and existing investors Hummingbird Ventures and GeoPost. It will use the new investment to expand the team, acquire new retail partners, and prepare to launch its service in the US in early 2013.
Tom Allason, founder and CEO of Shutl has spent this last year taking Shutl national across the UK. He says “we are ready for the U.S., a market that we estimate will be worth around $26bn by 2016.” Allason previously founded and exited from eCourier.co.uk so he knows what he’s talking about.
The UPS Strategic Enterprise Fund is the private equity strategic investment arm of UPS. GeoPost operates in more than 30 countries and is Europe’s third largest provider of express delivery. Hummingbird Ventures is a seed and early-stage venture capital running out of London but investing extensively in the Middle East
Shutl is currently used by big UK high street stores Argos, Aurora Fashions, B&Q Tradepoint, Karen Millen and Maplin. It works as a platform that connects retailers to local same-day courier companies, enabling online and in-store customers to receive their shopping within as little as 90 minutes or within a 1-hour window of their choice. It claims to hold the record for the world’s fastest e-commerce delivery; a shopper taking receipt of their goods within 15 minutes of checking out online. But alas, that’s not been independently verified. That said, it would appear a jokey PR release they made about offering 100 metre Olympic champion Usain Bolt equity in the company may yet come true.
Shutl’s U.S. launch comes in the context of Amazon’s view that same-day delivery is going to be key to them (and important enough to give up their sales tax advantage). However, it’s not fully launched yet so there is a window for startups right now.
Amazon would also need to put warehouses in every town or city to make it work. Meanwhile – as Allason points out – Amazon will drive merchant and shopper expectation for same-day delivery.
eBay is not really in this space as they are competing with our retailers for shoppers, not delivery firms.
Postmates is basically using same model as eBay Now but in a less scalable manner, however, as they are not yet innovating on the retailer side and using individual couriers rather than courier companies, a little like Uber uses drivers (note that a single courier has limited capacity particularly when they are already working for a courier company). They are also just operating in SF right now.
And consumers don’t generally shop though a dedicated application in order to be able to receive quick or convenient delivery.
“Our view is that our merchants have been innovating on their own for buying experience and so there was no need for us to re-invent the wheel. Instead we have been working for almost 3 years to solve a really difficult problem and we’ve solved it now in 60+ towns across UK,” says Allason.