Deliverr Secures New Funding to Enhance Inventory Placement

Supply Chain Resilience Drives Deliverr's $250 Million Funding Round

Despite indications of diminishing global supply chain issues, a return to pre-disruption normalcy isn't anticipated for some time. Deliverr’s technological infrastructure was specifically engineered to provide merchants with cost-effective, next-day e-commerce fulfillment, even amidst ongoing logistical challenges. Consequently, significant investor interest is being demonstrated in supporting the company’s continued growth.

Valuation Doubles in Seven Months

The San Francisco-based firm revealed on Monday a $250 million Series E funding round, elevating its valuation to $2 billion. This represents more than a doubling of the valuation achieved just seven months prior, when a $170 million round was led by Coatue.

Predictive Analytics and Strategic Warehousing

Deliverr offers fulfillment solutions to e-commerce businesses operating on platforms such as Shopify, Walmart, Amazon, eBay, and Target. The company leverages predictive analytics to forecast product demand, considering factors like demographic data and geographic location. Items are then strategically positioned near anticipated demand centers.

According to co-founder and CEO Harish Abbott, supply chain limitations are becoming increasingly pronounced. To mitigate these issues, Deliverr maintains a network exceeding 80 warehouses, cross-docks, and sortation facilities located close to consumer demand. This reduces transit distances and lowers fulfillment costs, resulting in a 90% year-over-year growth rate for Deliverr’s merchants.

Pandemic-Fueled E-commerce Growth

Elevated demand levels stemming from the pandemic continue to persist. Constraints within the labor market prompted innovative partnership strategies and expansion plans as e-commerce solidified its position as the dominant sales channel, while traditional brick-and-mortar retail experienced limited growth.

Deliverr’s gross merchandise value has increased substantially year-over-year and is projected to surpass $2.5 billion by year-end. The company has also expanded its warehouse and carrier network to facilitate one-day fulfillment services to major metropolitan areas. Notably, half of the U.S. population resides within a 100-mile radius of a Deliverr network facility.

Expansion of Merchant Base and Team

Alongside network growth, Deliverr has broadened its merchant base and doubled its workforce, establishing offices internationally.

E-commerce Fulfillment Market Outlook

The global e-commerce fulfillment services market is currently valued at $86.4 billion and is forecast to nearly double to $168.7 billion by 2028. Given increasing consumer expectations for faster, more dependable shipping, Deliverr is favorably positioned to capitalize on these trends and ongoing supply chain disruptions, Abbott stated.

Investment Landscape

The e-commerce fulfillment sector is currently attracting significant investment globally. Recent funding announcements have been made by companies including Hive, Fabric, Sendbox, and ShipBlu. Tiger Global spearheaded Deliverr’s latest investment, with participation from existing investors 8VC, Activant, GLP, Brookfield Technology Partners, and Coatue.

Strategic Partnership with Tiger Global

Despite already being “well funded” from earlier fundraising efforts, Abbott explained that increased investor interest led to a partnership with Tiger Global, citing their “exceptional track record” in identifying and nurturing promising companies into industry leaders.

Future Investments

The newly acquired capital will be allocated to ongoing technology and product development, employee recruitment, and the expansion of next-day delivery capabilities.

“These investments ultimately enhance conversion rates and deliver superior customer experiences,” Abbott added. “We will also focus on developing new functionalities, such as returns processing, prep services, LOT tracking, and temperature-controlled logistics, to establish Deliverr as the most user-friendly fulfillment solution available to brands.”

Tiger Global's Perspective

John Curtius, a partner at Tiger Global, commented in a statement that Deliverr is uniquely positioned to lead the e-commerce fulfillment space due to converging market dynamics.

“No other company combines cutting-edge fulfillment infrastructure and technology to simultaneously address logistical disruptions, offer merchants next-day delivery, and reduce their costs,” he concluded.