Lack of Funding Drives Food Rocket to Shut Down
CHARLOTTE, N.C. — Rapid grocery delivery startup Food Rocket ceased operations in the United States, citing the company exhausted its funding.
Despite overall profitability, Food Rocket ran out of capital while struggling to raise additional funding, and build a bridge between the capital market and its investor retail company, Alimentation Couche-Tard Inc.
"We believe that the rapid delivery industry has disrupted the retail market and changed consumer behaviors. Unfortunately, current economic conditions reshuffled the tech market and presented significant challenges in the venture capital market," said Vitaly Alexandrov, CEO and founder of Food Rocket. "The decision to cease operations was incredibly hard, and we put in 100 percent up until the very last day, trying to stay afloat for our customers and team members."
Couche-Tard became the lead investor in Food Rocket through a $25 million series A investment last year. The funding was used to expand the Food Rocket service, reinforce its artificial intelligence-enabled software and enhance its team.
The equity investment came through the Circle K Venture Fund, which was established to invest in companies developing transformative solutions that are shaping the future of convenience, as Convenience Store News previously reported.
Most recently, Circle K, the global convenience store banner of Couche-Tard, teamed up with Food Rocket to pilot its quick delivery business model at two Charlotte c-stores. All orders were delivered from two micro-fulfillment centers that occupy between 170 and 500 square feet within the Circle K stores, located at 8505 S. Tryon St. and 8008 Harris Station Blvd.
Food Rocket launched in San Francisco in spring 2021, followed by a Chicago expansion in February 2022. It takes two to three minutes to process an order, with delivery taking around 10 minutes. Food Rocket guarantees delivery within a timeframe specified in the app, or it will be free.
Laval, Quebec-based Alimentation Couche-Tard Inc. operates in 24 countries and territories, with close to 14,300 stores, of which approximately 10,900 offer road transportation fuel. With its well-known Couche-Tard and Circle K banners, Couche-Tard is one of the largest independent c-store operators in the United States, and is a leader in the c-store industry and road transportation fuel retail in Canada, Scandinavia, the Baltics and Ireland.