After raising $125M, Munchery fails to deliver

On-demand food delivery startup Munchery is shutting down, the startup announced in an e-mail to customers on Monday.

On-demand food delivery startup Munchery is ceasing operations effective immediately, the startup announced in an e-mail to customers on Monday.

Founded in 2010, the San Francisco-based business had raised a total of $125 million in venture capital funding, reaching a valuation of $300 million with an $87 million round in 2015, according to PitchBook. Munchery was backed by Greycroft, ACME Ventures (formerly known as Sherpa Capital), Menlo Ventures, e.Ventures, Cota Capital, M13 and more.

“Since 2010, we have been committed to bringing fresh, local, and delicious meals into your homes along with all our customers across the country,” the company wrote in today’s e-mail announcement. “We’ve been delighted to work with world-renowned chefs, experiment with diverse and unique ingredients and recipes, and be a part of your holiday feasts and traditions. We have also enjoyed giving back to our community through meal donations, volunteer service, and so much more.”

The news comes as little surprise considering Munchery laid off 257 employees, or 30 percent of its workforce, in May after shutting down its Seattle, Los Angeles and New York operations. At the time, the company said it planned to double down on its biggest market, San Francisco, which would help it “achieve profitability on the near term, and build a long-term, sustainable business.”

Munchery, however, failed to deliver on those promises. On top of the 2018 layoffs, Munchery for years struggled to navigate the challenging plains of on-demand food delivery. To stay afloat, the startup shape-shifted quite a bit from originally launching as a ready-to-eat meal delivery service to delivering meal-kits to creating an $8.95 a month subscription plan for repeat customers and finally, opening up a shop inside a San Francisco BART station in a bid to win over the commuter crowd.

Munchery is just the latest in a line of food delivery startups to shutter. Doughbies, an on-demand cookie delivery business, closed its doors in 2018. Sprig, Maple and Josephine are amongst the others to falter under the pressure of a crowded market.

After raising $125M, Munchery fails to deliver

On-demand food delivery startup Munchery is shutting down, the startup announced in an e-mail to customers on Monday.

On-demand food delivery startup Munchery is ceasing operations effective immediately, the startup announced in an e-mail to customers on Monday.

Founded in 2010, the San Francisco-based business had raised a total of $125 million in venture capital funding, reaching a valuation of $300 million with an $87 million round in 2015, according to PitchBook. Munchery was backed by Greycroft, ACME Ventures (formerly known as Sherpa Capital), Menlo Ventures, e.Ventures, Cota Capital, M13 and more.

“Since 2010, we have been committed to bringing fresh, local, and delicious meals into your homes along with all our customers across the country,” the company wrote in today’s e-mail announcement. “We’ve been delighted to work with world-renowned chefs, experiment with diverse and unique ingredients and recipes, and be a part of your holiday feasts and traditions. We have also enjoyed giving back to our community through meal donations, volunteer service, and so much more.”

The news comes as little surprise considering Munchery laid off 257 employees, or 30 percent of its workforce, in May after shutting down its Seattle, Los Angeles and New York operations. At the time, the company said it planned to double down on its biggest market, San Francisco, which would help it “achieve profitability on the near term, and build a long-term, sustainable business.”

Munchery, however, failed to deliver on those promises. On top of the 2018 layoffs, Munchery for years struggled to navigate the challenging plains of on-demand food delivery. To stay afloat, the startup shape-shifted quite a bit from originally launching as a ready-to-eat meal delivery service to delivering meal-kits to creating an $8.95 a month subscription plan for repeat customers and finally, opening up a shop inside a San Francisco BART station in a bid to win over the commuter crowd.

Munchery is just the latest in a line of food delivery startups to shutter. Doughbies, an on-demand cookie delivery business, closed its doors in 2018. Sprig, Maple and Josephine are amongst the others to falter under the pressure of a crowded market.

Braavo raises $6M for its app financing business

Braavo, a startup that provides financing to mobile app developers, is announcing that it has raised $6 million in Series A funding. The might not seem like much compared to the $70 million that Braavo announced raising last year, but that was debt financing, used to loan money to developers. This new round is equity […]

Braavo, a startup that provides financing to mobile app developers, is announcing that it has raised $6 million in Series A funding.

The might not seem like much compared to the $70 million that Braavo announced raising last year, but that was debt financing, used to loan money to developers. This new round is equity financing, used to fund Braavo’s own operations and growth.

Co-founder Mark Loranger told me Braavo was founded in 2015 in response to the “new dynamics” of mobile app businesses. And it’s worked with developers including Verv, Fanatee and Pixite.

“The data is there to create ways to provide financing to companies that otherwise would have to raise more [venture funding] and dilute themselves,” Loranger said.

For its first financing product, Braavo looks at Apple App Store and Google Play data, specifically the amount of money already earned by an app but not yet paid out. It can then provide an advance on some of that revenue.

Loranger described Braavo’s newer product as “more exciting” and “more data-driven.” It looks at user acquisition, user engagement and revenue, projecting how revenue would grow if a developer had more money for user acquisition — and then it can provide debt financing for that growth.

Braavo subscriptions

Braavo gets paid back as “a fixed percentage of future earnings,” Loranger said, so its incentives are aligned with the developers: “We only make our money back as they earn more revenue in the future.” And if app revenue doesn’t grow as anticipated, that just means Braavo gets paid back more slowly.

“We’ve never, ever lost a dime,” he said.

The company is also announcing the launch of a new analytics product that will allow businesses to track key metrics like the lifetime value of their customers.

Loranger said this will be available for free to anyone to anyone with a “revenue-generating mobile app business.” Rather than charging for the product directly, the goal is to “create more success for mobile app business that may end up qualifying for funding.”

The new round brings Braavo’s total equity financing to nearly $8 million. It was led by e.ventures, with participation from SWS Venture Capital (founded by Green Dot CEO Steve Streit) and Shipt CEO Bill Smith.