DoorDash acquires Finnish food delivery scale-up in €7bn deal

10 Nov 2021

Image: Wolt

The agreed deal will see DoorDash launch an international arm and bring its local logistics infrastructure to the European market.

NYSE-listed DoorDash has entered into an agreement to acquire Wolt Enterprises, a takeaway and grocery delivery start-up founded in Helsinki.

DoorDash will acquire Wolt in an all-stock transaction valued at about €7bn.

Tony Xu, co-founder and CEO of delivery platform DoorDash, said the two companies have a “shared vision” and commended the leadership of Wolt co-founder and CEO Miki Kuusi.

“By joining forces, we believe we will accelerate our product development, bring greater focus to each of our markets, and improve the value we provide to consumers, merchants, as well as Dashers and couriers around the world,” said Xu.

Founded in 2014, Wolt has scaled to a team of more than 4,000 across 23 countries, mainly in Europe. As of a nine-figure raise in January, it had raised a total of $856m and was ranked among Europe’s unicorn start-ups.

Founded in 2013, DoorDash operates in more than 7,000 cities across the US, Canada, Australia and Japan. Its total orders in its most recent quarter grew 47pc to 347m.

Following the acquisition, Kuusi will become head of DoorDash International, reporting directly to Xu. Kuusi is expected to deliver on global growth of the business as well as product development.

“DoorDash has built an incredible business in one of the most significant markets in the world,” said Kuusi. “We came from a small home country and had to master the art of expansion very early on. During this process, we’ve come to appreciate the many similarities of our two teams, cultures and companies, as we’ve been moulded by similar circumstances.”

The announcement came as DoorDash issued its Q3 earnings. The acquiring company announced revenue of $1.28bn, an increase of 45pc year on year.

Xu said the combined company will become a global force for “local commerce in the internet era”.

“Joining forces with Wolt will deepen our pool of superb talent and allow us to accelerate our international growth, while elevating our focus on the US,” he added.

The deal has been approved by the boards of both companies and is expected to close in the first half of 2022.

It comes in the context of heightened activity in the local logistics sector.

Just months after finalising a merger with Dutch business, Just Eat Takeaway announced that it would also be taking over US food delivery player Grubhub, forming a global food delivery giant.

Uber Technologies completed its $2.65bn acquisition of Postmates, a rival of its own Uber Eats, in late 2020.

Outside of mergers and acquisitions, the sector has seen Deliveroo take on one of the biggest IPOs on the London Stock Exchange in many years. However, a disappointing start on the stock market was attributed by some to concerns about the company’s working practices and its gig-economy model.

Meanwhile, Spanish delivery start-up Glovo, which achieved unicorn status in 2019, recently committed to establishing clearer pay structures and rights for its couriers.

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Elaine Burke is the host of For Tech’s Sake, a co-production from Silicon Republic and The HeadStuff Podcast Network. She was previously the editor of Silicon Republic.