Quick commerce startup Grovy has finalized a €3 million financing round led by Lighthouse Ventures. The funds will be used for further expansion across Central and Eastern Europe, with offices already running in Prague and Bucharest.
The startup has already established traction in the crowded German market by focusing on customer service, a positive and fair work culture, and sustainability.
The rise of same-day (and same-hour) grocery delivery in Europe has been rapid and not without teething problems.
First, many players in the space still rely on significant mark-ups, which can be as high as 20%. Second, many delivery companies depend on gig workers, who are often underpaid and overworked. Lastly, supply chain inefficiencies and food waste have plagued the grocery industry for decades, leaving plenty of room for improvement in sustainability.
Grovy is looking to improve retail grocery in all three of these areas. Grovy leverages a network of strategically located dark warehouses to bring supermarket products to people within 10 minutes.
While a 15-20% markup from supermarket prices is normal in grocery delivery, Grovy has pledged to never go beyond a 5% markup. Now, Grovy sets its sights on Central and Eastern Europe, where the startup envisions to become the regional market leader.
“Frankfurt and Mainz, with their high demand for quick commerce solutions, served as the perfect sandbox. But rather than replicate our model in other German cities, we are bringing it to larger cities across the CEE region, where 10-minute delivery is still a novelty and the potential to scale is massive. There are millions of urbanites in the region who can benefit from not having to stand in line at the supermarket every other day,” said Justin Adam, co-founder and CEO of Grovy.
According to Adam, such cities as Bucharest, Prague, and Warsaw provide the perfect storm for grocery delivery startups thanks to a combination of high population density, a relatively young, digitally savvy population, and lower costs of labour.
Grovy delivers only on bikes and EVs, sourcing from renewables whenever possible. The company is also participating in a carbon offset program and makes every effort to lessen the use of plastic throughout operations.
It also offers discounts on “ugly” produce and soon-to-expire perishables, helping to cut down on runaway food wastes. By also working with food waste startups such as Too Good To Go, Grovy is able to keep food wastes under 1%, in an industry where 30% food waste is not uncommon.
To be effective, Grovy uses a dense network of dark stores in larger urban centres to ensure no rider is further away than 8 minutes from their destination, as well as proprietary technology to ensure inventory accuracy and that products can be found within 90 seconds.
