A Food Rocket Comes Down to Earth As Another Fast Food Startup Closes Its Doors
It seems almost a lifetime ago when, in 2021, a bunch of fast food startups with interesting names like GoPuff and Gorillas are raising gonzo prices for money.
We all know what has happened since the days of financing the rapid growth of grocery. While I wouldn’t call last year’s pullback a canary in the coal mine, it was one of the first parts of the broader food technology market to send a signal that the era of easy money is over.
And so last week, in the midst of the ongoing financial crisis, we got the news that Food Rocket, the fast food restaurant that launched service in San Francisco in 2021, has closed its doors.
Here’s the full statement from the company:
Food Rocket, an instant grocery delivery startup, ceased operations in March 2023 after ending its funding. Despite all the profits, Food Rocket ran out of money while struggling to raise more money. The recent downturn in the stock market made it difficult to find a bridge to its investor Alimentation Couche-Tard, and the founding team made the difficult decision to close its operations in the United States.
“We believe that the fast delivery industry has disrupted the retail market and changed the behavior of consumers. Unfortunately, the current economic conditions have reshaped the technology market and brought major challenges to the business capital market. The decision to stop working was very difficult, and we put 100% until the last day, we try to stay working for our customers and members of the Alexandrov group, Road CEO Vita and the group.
At this point, almost no one is surprised by the closing of one of the youngest players in the division. The grocer’s well-publicized problems during the financial downturn and broader questions about the segment’s business case were the writing on the wall for companies like Food Rocket. Combine that with the fact that the company closed during the week when everyone’s attention was elsewhere, and the sound of the company’s doors closing didn’t make a whisper.
Ironically, Food Rocket’s closure comes at a time when company founder Vitaly Alexandrov predicts fast-food grocery will become mainstream.
“In one or two years, it will be like a commodity,” Alexandrov told The Spoon in 2021. “Everyone will deliver in ten minutes.”
Although his prediction is not really possible – mainly because many things do not need to be delivered with that level of urgency and same-day delivery for most of our needs – I think that the big players like Amazon and Walmart have made progress in building their fast delivery capabilities. In the long term, the introduction of new delivery and micro-manufacturing technologies will likely accelerate the speed at which consumers can satisfy their needs almost immediately.
Unfortunately for Food Rocket and many of its peers, they won’t be around to see the day when near-instant delivery becomes ubiquitous.
