Madison's grocery e-commerce software company GrocerKey Inc. was acquired by Stamford, Connecticut-based Point Pickup Technologies for $42 million, according to a Thursday announcement.
The deal marks a successful exit for GrocerKey's investors — the company raised around $7.1 million in equity financing, according to GrocerKey CEO and co-founder Jeremy Neren.
Through its cloud-based platform and network of drivers, Point Pickup Technologies provides same-day delivery capabilities to retail customers including Walmart and Pick 'n Save parent Kroger. In buying GrocerKey, Point Pickup will enable its customers to white-label their e-commerce experience from purchase to delivery and present their own branding to consumers, rather than relying on third-party services such as Instacart.
"Retailers no longer want to give away last-mile business to other consumer-facing platforms," said Point Pickup Technologies founder and CEO Tom Fiorita. "We listened to our clients and now with the integration of GrocerKey's technology into our last-mile delivery platform, they can reclaim their brand and revenue while maintaining control of their e-commerce data and customer experience from start to finish."
Neren will become Point Pickup's senior vice president of e-commerce strategy. He and Fiorita met a couple of years ago when they were both on a panel discussion about e-commerce grocery, Neren said. Their views about the future of the industry were aligned, and they kept in touch. About six months ago, they began discussing the acquisition deal.
"We have really synergistic products and services, so we just felt like it was the right time to begin tackling the market collaboratively," Neren told the Business Journal. "Being able to provide brands with complete control over their e-commerce services from point of sale to delivering to customers' homes is a game-changer," Neren said in a statement.
GrocerKey raised $2.4 million in 2020 from Cleveland's Comeback Capital, according to a Wisconsin Technology Council report. In 2018, GrocerKey announced it had raised $2.5 million from investors including Janesville-based Woodman’s Markets and London's dunnhumby Ventures. The company was also part of gener8tor's equity-based accelerator program in Madison in 2015.
"Jeremy, he's been a Wisconsin-based startup, and a Wisconsin-based success story now," said gener8tor co-founder Joe Kirgues. "The company has grown from scratch to this publicly disclosed outcome that I think is a mutual success for everyone involved."
GrocerKey was founded in 2014, but the company picked up steam during the pandemic as grocery delivery spiked in popularity.
