A grocery distribution startup in San Francisco that's valued at more than $3 billion has gobbled up Oakland-based Good Eggs, its eighth acquisition this year alone.
GrubMarket bought Good Eggs for an undisclosed price and the transaction has closed, GrubMarket CEO Mike Xu confirmed via email, though he declined to provide additional details.
It was an all-stock deal, according to TechCrunch which first reported the news on Tuesday.
Good Eggs had raised more than $285 million since it was founded in 2011, according to PitchBook, and was most recently valued at $22 million last year — a fraction of its valuation four years ago which peaked at $365 million.
“Profitability is in our DNA,” Xu told TechCrunch. “We know how to get things profitable. It’s a systematic approach.”
Fresh grocery delivery is a notoriously difficult sector to get right both in terms of profitability and logistics.
GrubMarket initially focused on consumer delivery when it launched in 2014 but, unlike Good Eggs, switched to providing grocery distribution services for businesses.
Good Eggs currently operates in the Bay Area and Los Angeles. The company relaunched in Los Angeles two years ago after shutting down its Southern California operation in 2015, Eater previously reported.
That expansion came after Good Eggs raised a $100 million round in 2021, and it also relocated to Oakland from San Francisco that year.
GrubMarket's acquisitions this year include other produce distributors and grocery technology companies such as San Francisco-based Butter Technologies.
GrubMarket has raised more than $555 million itself including a Series G round which valued the company at $3.5 billion on a premoney basis, according to PitchBook.
Both GrubMarket and Good Eggs were among a wave of new grocery and meal delivery startups that exploded in the 2010s, after the sector imploded in the wake of the first dot-com bubble bursting.
Webvan notoriously shuttered in 2001, two years after its IPO and after burning through more than $800 million. Several former Webvan leaders went on to launch Amazon's grocery delivery service known as Amazon Fresh in 2013, Reuters previously reported.
Fremont-based Weee, founded in 2015, specializes in delivering Asian grocery boxes and has raised more than $816 million, including a $425 million Series E round which valued the company at over $4 billion in 2022.
Over the past few years, several startups tried to go after rapid same-day grocery delivery services, often promising to deliver within 15-minutes or 24 hours, including Palo Alto-based Food Rocket which shut down last year and San Francisco-based Feed, formerly known as Popcorn.
