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Amazon takes stake in Deliveroo as part of $575m funding round

Online food delivery service provider Deliveroo has announced that Amazon is leading a new $575 million Series G preferred shared funding round.

Alongside existing investors, T. Rowe Price, Fidelity Management and Research Company, and Greenoaks, Amazon looks set to gain an influential share in the business as part of a move which takes the total Deliveroo has raised to date to $1.53 billion.

Deliveroo said the new round of funding will help it improve its platform, offer more work for riders, and help restaurants to grow their businesses by reaching new customers.

Plans are now in place to grow Deliveroo's engineering team based at its London headquarters, expand Deliveroo's delivery reach, and support new propositions, such as Deliveroo’s delivery-only super kitchens – called "Editions". The online food delivery company has also promised more tools “to offer riders flexible and well-paid work”.

Research group NPD Group predicted at the end of last year that 2019 would see more demand for so-called ‘virtual restaurants’ run from ‘dark kitchens’ owned by companies such as Deliveroo, Just East and Uber Eats. These virtual restaurants are typically run from an industrial estate rather than a traditional retail location, and Amazon's investment in Deliveroo may well support more of these facilities in the months ahead.

Will Shu, founder and CEO of Deliveroo, commented: "This new investment will help Deliveroo to grow and to offer customers even more choice, tailored to their personal tastes, offer restaurants greater opportunities to grow and expand their businesses, and to create more flexible, well-paid work for riders.

"Amazon has been an inspiration to me personally and to the company, and we look forward to working with such a customer-obsessed organisation. This is great news for the tech and restaurant sectors, and it will help to create jobs in all of the countries in which we operate."

Doug Gurr, Amazon UK country manager, added: "We're impressed with Deliveroo's approach, and their dedication to providing customers with an ever increasing selection of great restaurants along with convenient delivery options.

“Will and his team have built an innovative technology and service, and we're excited to see what they do next."