Longevity hasn’t been enough to save nine-year-old Melbourne delivery service YourGrocer, which closed its doors Friday just weeks after trying to raise more than $1 million through crowdfunding.
YourGrocer CEO Morgan Ranieri, co-founder of profit-for-purpose company, Thankyou, launched his grocery business in 2013, with a more boutique approach, working with approximately 85 independent grocers, fruit growers, butchers and fishmongers to supply Melbourne. The company had about 60 employees and launched a crowdfunding campaign on Birchal last month.
The campaign fell short of the $1 million success funding threshold, attracted approximately $225,000 from 60 willing funders, and fell through.
Last week, Ranieri wrote to customers saying “it is with a heavy heart” that YourGrocer would be “closing for good,” last Friday, December 16.
“As hard as we’ve tried, we can’t keep the business going any longer, so we’ve been forced to stop working,” he said.
“We sincerely apologize for the inconvenience and disappointment.”
YourGrocer had a strong and loyal following citywide and generated $9.2 million in sales in FY 2022, grossing nearly $2.9 million, but posting a loss for the fiscal year of just over $680,000.
Average customer spend was $158 per order, 4% higher than the average weekly grocery spend for an Australian household.
The prospectus for the Birchal campaign, which raised up to $1.5 million, acknowledged that the company is not yet profitable. YourGrocer performed well during the pandemic and lockdowns, generating its first profit, but reinvesting that money into expanding its tech business development capacity.
Ranieri was a minor shareholder in the company with a 16.8% stake. He was 23 when he founded YourGrocer.
The collapse follows the recent closures of Sydney grocery delivery startup Voly, which shut down last month just 12 months after launching, and Send, which shut down in May.
The Australian arm of global food delivery company Deliveroo went into receivership last month after its London Stock Exchange-listed parent company withdrew its support for local operations. Last week it emerged that Deliveroo was losing about $3 million a month locally as revenues fell this year in the wake of the 2021 pandemic lockdowns.