Delivery Hero, the online food ordering startup based in Berlin, has seen a surge in its valuation, which topped over $5 billion after the company went public in a listing on the Frankfurt stock exchange.
The listing is touted to be the largest by a European technology business in almost two years and the fourth by a food delivery group since 2014.
Through this IPO, Delivery Hero raised almost €1bn. It was more than 10 times oversubscribed by investors. The rise gave the six-years-old company market capitalization of around €4.5 billion, or approximately $5.1 billion.
As per the report, the startup will net €465m from the listing. It will use the money to pay back loans and then for the expansion.
Alexander Frolov, founder of Target Global, which invested in Delivery Hero in 2013, said,
My view is that some of the business models in technology are overrated, as though they [have] a monopoly over the internet. I just think that food delivery, where there are lifetime-long customers, is good.
Niklas Östberg, co-founder and chief executive, said that the company wanted to break even or become profitable from next year. He said, “We’re going to invest and continue to grow and take growth into profitability.”
Delivery Hero, founded in 2011, is currently operating across more than 40 countries and has plans to expand in newer markets with less competition. It operates in Germany, UK, Austria, South Korea, Sweden, Finland, Poland, Australia, Switzerland, China, India, Colombia, Mexico, Argentina, Chile, Uruguay, Brazil, Peru, Venezuela, Panama and Puerto Rico.
The company reportedly has more than 1000 employees globally, with 400 working from its Berlin Headquarters.
Till now, Delivery Hero has raised more than $1.8 billion in funding rounds from several investors, including Rocket Internet, Kite Ventures, Point Nine Capital, etc. In 2014 alone, the company received $523 million in investment.
So far, Delivery Hero has acquired 13 companies, which include 9Cookies, PedidosYa, Sinimanes, ClickDelivery, Pizza.de, Subdelivery, DameJidlo, Yemeksepeti, Efood.gr, foodora, Suppertime Australia, and Foodpanda.
With this IPO, Delivery Hero has now become the fourth major online food delivery company to go public in recent years. It is following the footsteps of Just Eat, Takeaway.com and GrubHub – which have all seen their share prices surge since listing.