Backed by Blossom, Creandum and Index, grocery delivery and dark store startup Dija launches in London – TechCrunch

Dija, the London-based grocery delivery startup, is formally launching in the present day and confirming that it raised £20 million in seed funding in December — a spherical that we first reported was partially closed the earlier month.

Backing the corporate is Blossom Capital, Creandum and Index Ventures, with Dija seemingly capable of increase pre-launch. In reality, there are already rumours swirling round London’s enterprise capital neighborhood that the upstart could also be out elevating once more already — a determine as much as £100 million was mooted by one supply — because the race to develop into the early European chief in the burgeoning “dark” grocery store house heats up.

Delivery Bag DIJA

Image Credits: Dija

Over the previous couple of months, a number of European startups have launched with the promise of delivering grocery and different comfort store gadgets inside 10-Quarter-hour of ordering. They do that by constructing out their very own hyper-local, delivery-only fulfilment centres — so-called “dark stores” — and recruiting their very own delivery personnel. This full-stack or vertical method and the visibility it supplies is then supposed to supply sufficient provide chain and logistics effectivity to make the unit economics work, though that half is way from confirmed.

Earlier this week, Berlin-based Flink introduced that it had raised $52 million in seed financing in a combination of fairness and debt. The firm didn’t escape the equity-debt break up, although one supply informed me the fairness part was roughly half and half.

Others in the house embody Berlin’s Gorillas, London’s Jiffy and Weezy, and France’s Cajoo, all of which additionally declare to concentrate on contemporary meals and groceries. There’s additionally the likes of Zapp, which remains to be in stealth and extra targeted on a doubtlessly higher-margin comfort store providing just like U.S. unicorn goPuff. Related: goPuff itself can be seeking to develop into Europe and is presently in talks to acquire or invest in the U.K.’s Fancy, which some have dubbed a mini goPuff.

However, let’s get again to Dija. Founded by Alberto Menolascina and Yusuf Saban, who each spent quite a lot of years at Deliveroo in senior positions, the corporate has opened up store in central London and guarantees to allow you to order groceries and different comfort merchandise inside 10 minutes. It has hubs in South Kensington, Fulham and Hackney, and says it plans to open 20 additional hubs, protecting central London and Zone 2, by the summer time. Each hub carries round 2,000 merchandise, claiming to be bought at “recommended retail prices”. A flat delivery charge of £1.99 is charged per order.

“The only competitors that we are focused on are the large supermarket chains who dominate a global $12 trillion industry,” Dija’s Menolascina tells me after I ask about opponents. “What really sets us apart from them, besides our speed and technology, is our team, who all have a background in growing and disrupting this industry, including myself and Yusuf, who built and scaled Deliveroo from the ground up”.

Menolascina was beforehand director of Corporate Strategy and Development on the takeout delivery behemoth and held a number of positions earlier than that. He additionally co-founded Everli (previously Supermercato24), the Instacart-styled grocery delivery firm in Italy, and additionally labored at Just Eat. Saban is the previous chief of employees to CEO at Deliveroo and additionally labored at funding financial institution Morgan Stanley.

During Dija’s soft-launch, Menolascina says that typical clients have been doing their weekly meals store utilizing the app, and additionally fulfilling different wants, corresponding to last-minute emergencies or late evening cravings. “The pain points Dija is helping to solve are universal and we built Dija to be accessible to everyone,” he says. “It’s why we offer products at retail prices, available in 10 minutes — combining value and convenience. Already, Dija is becoming a key service for parents who are pressed for time working from home and homeschooling, as one example”.

Despite the thousands and thousands of {dollars} being pumped into the house, quite a lot of VCs I’ve spoken to privately are skeptical that contemporary groceries with close to immediate delivery may be made to work. The pondering is that contemporary meals perishes, margins are decrease and basket sizes received’t be massive sufficient to cowl the prices of delivery.

“This might be the case for other companies, but almost everyone at Dija comes from this industry and knows exactly what they are doing, from buying and merchandising to data and marketing,” Menolascina says, pushing again. “It’s also worth pointing out that we are a full-stack model, so we’re not sharing our margin with other parties. In terms of the average basket size, it varies depending on the customer’s need. On one hand, we have customers who do their entire grocery shop through Dija, while on the other hand, our customers depend on us for emergency purchases e.g. nappies, batteries etc.”

On pricing, he says that, like all retail enterprise, Dija buys merchandise at wholesale costs and sells them at beneficial retail costs. “Going forward, we have a clear roadmap on how we generate additional revenue, including strategic partnerships, supply chain optimisation and technology enhancements,” provides Menolascina.

Dija testing on Deliveroo

Image Credits: TechCrunch

Meanwhile, TechCrunch has discovered that previous to launching its personal app, Dija ran quite a lot of experiments on takeout market Deliveroo, together with promoting numerous comfort store gadgets, corresponding to potato chips and over-the-counter prescription drugs. If you’ve ever ordered toiletry merchandise from “Baby & Me Pharmacy” or bought chocolate sweets from “Valentine’s Vows,” you may have possible and unknowingly shopped at Dija. Those manufacturers, and quite a lot of others, all delivered from the identical handle in South Kensington.

“Going direct to consumer without properly testing pick & pack is a big risk,” Menolascina informed me in a WhatsApp message a number of weeks in the past, confirming the Deliveroo exams. “We created disposable virtual brands purely to learn what to sell and how to replenish, pick & pack, and deliver”.

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