In an up-and-down year for venture capital fundraising and tech companies, the Philadelphia area's largest startups hit highs and lows.
After breaking records for venture capital raised in the first half of the year, funding plunged and IPO markets nearly froze. Still, unicorns dbt Labs, Misfits Market and Gopuff, three of the fastest-growing startups to come out of the Philadelphia area in the past decade, all made headlines in 2022.
Each discussed the prospect of an initial public offering this year, but unfavorable market conditions put the focus on continued growth instead.
That is, except for Gopuff. The delivery startup had a rocky 2022 that saw it cut staff and scale back following a period of rapid growth. The Callowhill-based company issued a $1.5 billion convertible note in December 2021, followed by a report that an IPO was imminent.
Gopuff brought Disney's Bob Iger on as an investor and advisor in March, also poaching executives from giants like Amazon, PepsiCo and Beyond Meat. It looked like the Philadelphia company was trending toward becoming the nation's next delivery behemoth.
But in July, reports came out about the company enforcing widespread staff cuts and closing 76 warehouses. More layoffs hit in October, with both rounds part of a 10% workforce reduction that affected some 1,500 workers.
Gopuff co-CEO Rafael Ilishayev, who founded the company with Drexel classmate Yakir Gola, told the Business Journal in September that the company's goal is to get back to profitability in 2024. Ilishayev said an IPO could be on the table once the capital markets open up again but that Gopuff is taking "big, bold steps — frankly, uncomfortable steps" with the goal of getting back to profitability.
Throughout the distress of 2022, Gopuff also leaned into its own private label. It launched its Basically line in January, launched a plant-based snack food brand called Good Eat’n with NBA star Chris Paul and rolled out an over-the-counter line of health and wellness products in October.
Fellow food delivery startup Misfits Market also made noise this year after hitting a $2 billion valuation in late 2021.
Delanco, New Jersey-based Misfits Market acquired its main competitor, Silicon Valley-based Imperfect Foods, in September. Both companies employed about 1,300 people and served some 250,000 customers per month at the time of the deal. Combining with Imperfect Foods helped Misfits Market immediately scale across the country.
It also allowed the company to move up its timeline for profitability about a year to 2024, according to CEO Abhi Ramesh. From there, Ramesh wants to take the company public, which he said could be in 2024 as well, or "soon after integration" of Misfits Market and Imperfect Foods.
Dbt Labs was also weighing an IPO at one point in 2022. The data analytics startup raised a $222 million Series D round, jumping its valuation to $4.2 billion, the region's second highest valuation behind Gopuff at $15 billion.
The company had plans to increase its headcount from 225 at the time of the fundraising in February to 500 by the end of the year. There are more than 400 people that currently list dbt Labs as their place of work on LinkedIn. The firm had just 16 employees at the start of 2020.
