Investors have recently piled millions into same-day delivery startups such as New York’s Zipments and San Francisco’s PostMates, and now Palo Alto firm Deliv has become the latest beneficiary, with plans to use a $6.85 million series A investment to hire new staff and roll out services to hundreds of retailers located in shopping malls across America.
Upfront Ventures and RPM Ventures, who have previously funded retailers including Costco, Office Depot, and Starbucks, led the investment round in Deliv, whose technology integrates directly into the retailer’s e-commerce properties allowing customers to select the same-day delivery option at the time of checkout. Prices are similar to that of standard delivery.
Deliv founder and CEO Daphne Carmelli told TechCrunch the funding would be used to execute on the recent partnership with shopping mall manager General Growth Properties, where the firm also manually coordinates deliveries for in-store customers. For example, aggregating and delivering mall-wide purchases for a patron that commutes via public transport. The service is currently available in four GGP malls and is expected to be available nationwide by the holidays.
Carmelli said retailers are the key to demand and scale.
“Once we sign a retailer all we need to do is add zipcodes to our database and we have same day delivery demand in a city,” she said.
Investment in the space is heating up. Earlier this week, New York based retailer-courier marketplace Zipments raised $2.25 million to expand its same-day services beyond its three core cities of New York, Chicago, and Grand Rapids, Michigan, where smaller and individual operators, such as bicycle couriers, are using the technology to more efficiently service retailers’ delivery needs. In March, San Francisco’s Postmates raised $5 million from the Founders Fund to expand its services to Seattle and New York, and now boasts nearly 300 couriers, who buy goods on behalf of customers and reimbursed upon delivery. Deliv has raised $7.85 million in total, following a $1 million seed investment from Redpoint Ventures, Trinity Ventures, General Catalyst Partners, PivotNorth Capital and The Operator’s Fund.
Companies like Deliv and Zipments are using marketplace and logistics systems to provide a faster, cheaper way for retailers to deliver goods; while on-demand services such as Postmates and TaskRabbit combine technology with feet-on-the-ground to create a new channel for customers to buy products from local high-volume retailers, such as restaurants.
Deliv is aiming to seamlessly connect the customer, retailer, and courier and Carmelli said the crowdsourced courier model provides a more efficient way for customers to transact with retailers — rather than introducing a new delivery mechanism like Postmates and Taskrabbit, which directly manage hundreds of couriers.
“Those two business are terrific but they are marketplaces so they need to generate demand in every city they go. The reps or agents do the buying, whereas with Deliv we retain the integrity of the retailer-consumer relationship. We are just the cost efficient last mile.”