US eCommerce giant Amazon announced that the company has invested in the latest fund raising of Roofoods Ltd. a UK based online food courier company. Roofoods Ltd which operates in nearly 200 cities across Europe, United Arab Emirates, Hong Kong and Taiwan is branded as Deliveroo.
While the exact amount of Amazon’s investment is undisclosed, reports says that the US online shopping leader is the major investor in the $575 million that Deliveroo amassed. In 2016 Amazon started its own food delivery company called Amazon restaurants. However unable to compete with a existing players such as Uber Eats, Just Eat, GrubHub and Deliveroo the Amazon restaurants food delivery venture was shut down in 2018.
With Amazon backing Deliveroo is expected to increase its market share in an already fiercely competitive British online food delivery market. Analysts believe that what attracted amazon to Deliveroo is that it is a tech company that has the potential to grow to other areas. As one of the fasted growing company in Europe, it is the company’s predictive growth has become the major selling point.
Deliveroo was established in 2013. According to a study conducted in December 2017, since its date of establishment the company has created 7200 jobs in restaurant industry. The company now has a total investment of approximately US$1.5 billion. It’s main rival, JustEat is the market leader in UK with nearly 4 times share. The Amazon announcement caused a drop of 8% in JustEat’s stocks.