JOKR confirmed Tuesday that it has withdrawn its on-demand food delivery operations in both Santiago, Chile and Medellin, Colombia, letting go of 22 employees and 19 employees, respectively, in those markets.
The company said via email that the move will “further tighten our geographical footprint to those markets that have achieved the highest scale and hence, strengthen our path to profitability. As difficult as these changes are, they will help us become a more successful, sustainable and enduring company.”
Profitability challenges among grocery delivery startups are not new. Companies have struggled to come up with a business model that could generate meaningful revenue even as customers just ordered a bunch of bananas or a gallon of milk.
Co-founder and CEO Ralf Wenzel revealed in April that JOKR hit gross-profit status, but that high didn’t last long. He was back in the news a few months later saying that the company was shuttering its U.S. presence to focus on Latin America, where it was operating in countries including Mexico, Colombia and Peru.
The closing of the Santiago and Medellin markets isn’t a complete surprise.
In September, The Information reported that JOKR was talking to investors with a goal of raising up to $50 million that would value the company at $1.3 billion. This would be a slight bump from the company’s $1.2 billion valuation from its $260 million raise announced last November.
The Information’s article also noted that the company was losing nearly $10 million a month and that even if it raised the whole $50 million, the capital would not give the company much runway. Excluding that fundraising effort, JOKR has raised a total of $430 million, including debt.
Meanwhile, the company said it “remains focused on the large opportunity in our current markets and are confident about our unique value proposition in this region.”
“JOKR is deeply grateful to its team as well as our customers and local communities for their unwavering support and is committed to assisting employees in their transition,” it added.
Source @TechCrunch
