Rapid delivery start-up Getir valued at more than Sainsbury’s

Published On: March 21, 2022Categories: Latest News2.6 min read

Getir, the six-year-old rapid delivery startup that generated $1 billion (£760 million) in revenues in 2021 has been valued at $11.8 billion (£9 billion) in its latest fundraising round. The valuation means Getir is now worth significantly more than the £6.2 billion market capitalisation of Sainsbury’s, the UK’s second-largest supermarket chain. Sainsbury’s generated revenues of £28.8 billion last year.

The investment round, backed by the Emirati sovereign wealth fund Mubadala Investment Company, the Abu Dhabi Growth Fund, the New York-based asset manager, Alpha Wave Global and Silicon Valley venture capitalists Sequoia Capital, saw Getir raise $768 million at the eye-watering valuation.

The start-up, which last November acquired British rival Weezy for an undisclosed sum, has raised a total of $2 billion to date. However, the size of the latest valuation achieved by the still loss-making company has raised eyebrows.

Getir, whose name means “bring” in Turkish, the company was founded in Turkey in 2015, offers the rapid delivery of thousands of items across 81 towns and cities in its domestic market and another 48 across the USA and Europe. The company was founded by 60-year-old Turkish entrepreneur Nazim Salur.

The start-up says its app has been downloaded around 40 million times across the nine countries it currently operates in and it delivers almost one million orders a day. Items are stocked in dark stores which are not open to the public and act purely as fulfilment centres from which delivery riders run orders.

Getir’s £9 billion valuation means it is now worth far more than not only Sainsbury’s but probably also the UK’s third and fourth-largest supermarket chains, Asda and Morrison’s. The former was sold for £6.8 billion last February and the latter for £7 billion in October last year. Only Tesco, the UK’s largest supermarket with a market capitalisation of about £21 billion and 2021 revenues of £53.4 billion, is worth more.

Getir has, however, been caught up in the fallout of Russia’s invasion of Ukraine due to financial links to Vladimir Potanin, who is reportedly Russia’s richest man and a close acquaintance of Vladimir Putin. The pair have played ice hockey together. He is said to have masterminded the auctions that saw the oligarchs gain control of state-owned Russian companies at knock-down prices in the 1990s through a “loans for shares” scheme.

Labour MP Margaret Hodge this month named the 61-year-old on a list of oligarchs she dubbed “cronies of Putin”, though he has not been sanctioned yet. Last week he left Russia after criticising Kremlin plans to confiscate the assets of international companies pulling out of the pariah country.

Last week leaflets calling on consumers to boycott Getir, claiming its “global expansion is fuelled by Putin’s ice-hockey buddy”, we handed out around European cities where the start-up operates. Winter Capital, a Russian investment vehicle that has been funded by Potanin’s fund Interros, holds a small stake in Getir but the company said it did not participate in the latest funding round. If the fund is hit with sanctions, Getir has said it will reassess its relationship with it.

Sector analysts believe the lofty valuation achieved by Getir shows investor sentiment has been encouraged by the start-up’s success in achieving high rates of growth, demonstrating the business model’s potential. The challenge will be turning a profit with a notoriously low-margin business model.

A chunk of the new funds raised is expected to finance further acquisitions to allow Getir to firmly establish itself as the leader in a competitive market that is starting to consolidate.

About the Author: Jonathan Adams

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