Getil, the quick grocery delivery company that boomed during coronavirus lockdowns, has announced it will close its operations in the U.S. and Europe, another major exit by a pandemic darling.
The company aims to deliver groceries and other small convenience items in as little as 10 minutes, and said it would refocus on its home base of Turkey. His Getir, a privately held company, expanded rapidly, acquiring competitors and giving him operations in nine countries, and at its peak he was worth nearly $12 billion.
The company announced the decision in a short statement on Monday, adding that its U.S. subsidiary, Fresh Direct, will continue operations.
“Getir generates only 7% of its revenue from the markets it exits,” the statement said. “This decision will allow Getil to focus its funds on Turkey.”
Getir was all about speed. Gettil employees, dressed in purple and yellow, cycled through cities in the United Kingdom, Germany, the Netherlands and the United States, including New York and Chicago. The company's expansion has been rapid, and until 2021, Getir only operated in Turkey. Within a year, it was held in six European countries. The company's valuation rose from less than $3 billion a year ago to $11.8 billion in 2022.
In mid-2021, just five months after Blok was founded, it acquired rival companies such as Spain's Blok. It has also acquired well-known brands such as Britain's Weezy and Germany's Gorillaz. In 2021, Getir founder Nazim Tharoor said the company's expansion was a “race against time” until competitors caught up.
Before expanding into Europe, Getir built a stable business in Turkey for over five years, with operations in all major cities. The company's international boom was fueled by a series of factors that proved temporary.
Despite the grocery delivery industry's inability to find sustainable profitability, venture capitalist capital has flowed in amid low interest rates. Pandemic lockdowns have led consumers to use more delivery services while stuck at home. And Getir used deep discounts to attract customers.
However, all this started to ease after the lockdown. Central bankers aggressively raised interest rates starting in mid-2022 to curb high inflation. With the rising cost of living, consumers suddenly had less disposable income. And the return to socializing and the simple freedom of going to a convenience store meant fewer people were willing to pay a premium to have their groceries delivered to their home. .
Other companies that grew during the pandemic, such as Peloton and Zoom, also faced reversals in fortunes after the lockdown ended.
Last July, Getir closed its operations in Italy, Spain, Portugal and France. In September, the company's valuation was cut to just $2.5 billion, the Financial Times reported. At the time, Gettil was raising money during a widespread recession for venture capital-backed tech companies. During this recession, thousands of private companies went out of business as investors stopped funding many companies with only the promise of success.
Thousands of jobs are expected to be lost once Mr. Gettil completes his withdrawal to Turkey. Unlike other delivery companies, Getir employed its passengers and warehouse staff as employees and provided holiday pay and pensions. As of August, the company was reported to have approximately 23,000 employees, but some staff reductions have already been made as the company began withdrawing from European cities late last year.
