LAVAL, Quebec — Alimentation Couche-Tard is the lead investor in the latest round of funding for Food Rocket, a 15-minute grocery delivery service. The $25 million series A investment round will be used to expand the service in Chicago and other cities throughout the United States as well as reinforce its artificial intelligence (AI)-enabled software and enhance the team.
- Couche-Tard is No. 2 on CSP’s Top 40 update to the 2021 Top 202 ranking of U.S. c-store chains by store count. Watch for the full 2022 Top 202 ranking in the June issue of CSP magazine and in CSP Daily News.
Through the partnership, Food Rocket is working with Circle K to explore ways in which the c-store chain can extend its brand experience and offerings to customers beyond its physical stores through e-commerce and delivery. Meanwhile, Food Rocket expects to benefit from Circle K’s size and scale, consumer insights, marketing expertise, procurement network and supply chain efficiencies. The startup has launched a system that enables forecasting stock levels and employee workloads in its operations.
“By bringing the retail expertise of our investors, we will be able to significantly improve the unit economics by reducing the purchase costs of goods and marketing costs. In the grocery delivery market, this is a unique opportunity to stand out from competitors. Moreover, our AI-based algorithms analyze the users’ purchases to increase the retention of each customer. We continue to build our team internationally by recruiting people from giant companies such as goPuff and DoorDash,” said Vitaly Alexandrov (pictured), CEO and founder of Food Rocket.
In California, where Food Rocket launched in 2021, 60% of customers order a second time for a $30 average order value. Earlier this year, the startup launched delivery operations in Chicago. The team plans to create more than 2,000 jobs in new areas. Food Rocket continues to be one of the few startups offering full-time employment to all of its riders. This ensures workers a guaranteed income as well as benefits.
Couche-Tard’s equity investment in Food Rocket comes through its Circle K Venture Fund, which was established to invest in companies developing transformative solutions that are shaping the future of convenience.
“Food Rocket has an amazing, entrepreneurial team and technology with the potential to disrupt the delivery space,” said Kevin Lewis, chief marketing officer at Couche-Tard. “We are excited to partner with them as we continue to explore and pursue different and innovative new ways to serve our customers and make their lives a little easier every day.”
Palo Alto, Calif.-based Food Rocket is a rapid grocery delivery startup that provides fast grocery delivery, promising door-to-door delivery within 10-15 minutes of the order’s placement. Its business model is based on AI-enabled technologies to manage warehouse stocks, forecast demand and optimize delivery time by predicting the closest store that offers the fastest delivery time and the lowest costs of putting together and delivering the order.
Laval, Quebec-based Couche-Tard’s 26-country global network includes approximately 9,300 c-stores in North America, with more than 7,100 in the United States under the Circle K and Holiday Stationstores banners in 48 states, and approximately 2,100 in Canada under the Circle K, Mac’s and Couche-Tard banners. It has a worldwide total network of approximately 14,200 stores.
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