Deliveroo reveals that it lost $ 309 million in 2020 before the London IPO

LONDON —Deliveroo, the Amazon-backed food delivery service, revealed that it posted a loss of £ 223.7 million ($ 309 million) last year on fluctuation plans on the London Stock Exchange that were published on Monday .

Deliveroo’s losses are substantially less than they were in 2019, when the London-based company posted a loss of £ 317 million. Although the eight-year-old company is still in the red, its revenues rose to £ 4.1 billion in 2020, from £ 2.5 billion in 2019.

The date for Deliveroo’s initial public offering has not been officially announced, but it is likely to be in the coming weeks. Goldman Sachs and JP Morgan Cazenove were appointed as joint global coordinators.

Deliveroo can be valued at around $ 10 billion on the stock market listing, according to reports. He recently raised $ 180 million in new funds, giving him a valuation of $ 7 billion. Along with Amazon, Deliveroo is also supported by Durable Capital Partners, Fidelity, T. Rowe Price, General Catalyst, Index Ventures and Accel.

In the company’s document “Expected Intention to Float”, published on Monday, Deliveroo’s CEO, Will Shu, said that “he never intended to be a founder or CEO” and that “he did not read TechCrunch”.

“I’m not one of those Silicon Valley types with a million ideas,” said the former Morgan Stanley analyst in a letter included in the lawsuit. “I had an idea. An idea that was born out of personal frustration. An idea that I was fanatically obsessed with: I wanted good food to be delivered in amazing London restaurants.”

Deliveroo went from almost a failure in 2020 amid a review of competition in Amazon’s minority investment, to operating profitability at the end of the year, thanks to the increased demand for online delivery services driven by the coronavirus block.

Today, Deliveroo claims to have more than 115,000 food merchants and 100,000 restaurants and millions of consumers in 12 countries. The process shows that six million orders are placed at Deliveroo every month.

But Deliveroo “is still starting,” according to Shu.

“Our ambitions have increased as we begin to really understand and execute the opportunity ahead of us in online food,” he said.

The order includes details on Deliveroo’s two-class share structure, which will result in Shu obtaining 20 votes per share, while all other shareholders will be entitled to only one vote per share.

This structure, which will give Shu more voting rights and more control over the company’s direction, will be in place for three years.

It comes after a government-backed review calling for reforms to the London listing regime, including the ability to list shares of two classes that were initiated by Google and Facebook.

Deliveroo is planning to set aside £ 50 million in shares for customers across the UK.

“We are proud to allow our customers to participate in a future float and have a chance to buy shares,” said Shu. “Your loyalty and customs have helped to build our business. I want you to have a chance to share our future.”

Deliveroo said it will use IPO resources to enhance its application, expand its “Editions” kitchens for delivery only and deepen on-demand grocery deliveries, which are currently offered by supermarkets such as Waitrose, Co-op, Londis, Aldi and Carrefour .

Deliveroo is also planning to donate £ 16 million to its pilots through a new “Thank You Fund”, with a handful of loyal pilots receiving payments of £ 10,000. Others will receive £ 1,000, £ 500, £ 200 or £ 100, depending on how many orders they have delivered. The average payout will be £ 440.

Over the years, some of the company’s passengers have complained about how much they are paid by Deliveroo and have campaigned to be classified as workers rather than contractors, making them eligible for benefits like sick pay and holidays.

Amazon supported Deliveroo in May 2019, leading a $ 575 million financing round in exchange for a 16% stake in the business.

In July 2019, the UK antitrust regulator, the Competition and Markets Authority, argued that Amazon’s Deliveroo cash injection could reduce competition by removing the possibility of the e-commerce giant re-entering the market, while Deliveroo could “cease to be distinctive.” It froze the investment for almost a year while investigating.

Much to the disappointment of rivals Just Eat and Domino’s Pizza, the deal was approved by the CMA in August, after Deliveroo said it could close without the capital.

– Additional reporting by Ryan Browne of CNBC.