While rumors have been circulating for weeks now, Turkey’s ultrafast grocery service Getir has officially announced the acquisition of Berlin-based Gorillas for $1.2 billion, giving the combined group a $10 billion valuation. The deal is reportedly mostly comprised of equity, with around $40 million in cash being paid out to investors. However, as reported by the Financial Times' Tim Bradshaw, "given the drop in valuation, it is likely some Gorillas backers will be left with little or no return on their investment."
Gorillas once held a $3 billion valuation when it raised $1 billion from investors, including Tencent, AMYP Ventures, and Coatue in September of 2021. With Gorillas end price valued at $1.2 billion, Getir’s acquisition is a blatant sign that the era of cheap capital has come to an end.
With investors plowing massive sums of money into the space, ultrafast delivery services were able to effectively offer rock-bottom prices, with incredibly tight margins, all knowing full well that they were playing the “who can stand the longest” game. And, as it seems, Getir seems to be moving into the checkmate position, as only Germany's Flink and US-based Gopuff remain standing.
As noted by Bloomberg just a few days ago, another round of job cuts at Gorillas seems most likely, due in part to the overlap of dark stores warehouse both companies hold in cities including London, Paris, Amsterdam, and Berlin. Gorillas once held a $3 billion valuation when it raised $1 billion from investors, including Tencent, AMYP Ventures, and Coatue in September of 2021.
Alongside market consolidation and the drying up of investor money, Gorilla’s troubled past does nothing to add to the final sticker price. Since its founding in May of 2020, the startup has seen issues ranging from employee labour disputes which culminated in a wildcat strike, to new market entries and retreats, to allegations of co-founder Kağan Sümer being ousted from previous jobs due to drug use, land at its doorstep.
This past May, Gorillas fired almost half of its HQ staff, and noted that the closing of several national markets including Spain, Italy, Denmark, and Belgium was under consideration. At present, of those under consideration, only Denmark remains operational.
As for Getir’s long game, the startup is stocked with close to $2 billion in funding, and at its peak, valued at north of $12 billion, a figure that's now been cut to approximately $8.8 billion. They’ve already acquired competitors in Spain, Blok, and the UK, Weezy, as well as snapping up France's ready-to-eat meals and groceries service Frichti. However, as the market continues to consolidate and investor interest wanes, the question left to be answered is, just how far at to what end does Getir intend to go?