Uber’s High-Price Grocery Delivery Bet

Greetings!

It’s boom time for lazy people! Well, at least those people who couldn’t be bothered leaving the house to buy a bottle of beer or pick up the groceries. Delivery service GoPuff today struck a deal to buy Liquor Barn, an alcohol retailer, its second such purchase in a few months. Uber, meanwhile, said it would spend $1.4 billion in stock to buy full ownership in grocery delivery service Cornershop. The Cornershop deal, in particular, underlines how much money is being poured into the delivery of groceries at steadily escalating prices.

Consider that Uber already paid $484 million in cash and stock to buy 53% of Cornershop, a deal done mostly last July. Today’s deal, for the rest of Cornershop, implies the firm’s valuation has risen to $3 billion from about $900 million in 12 months. To be fair, both GoPuff and Instacart, the big dog of grocery delivery, have seen their self-worth inflate in the past year. Instacart, for instance, saw its valuation double to $39 billion between October and March. No doubt about it, Covid made grocery delivery a good business, particularly in the eyes of investors.