Fulfillment startup Deliverr raises $40M to grow staff, improve tech

Dive Brief:

Deliverr, an online order fulfillment startup, announced on Wednesday it raised $40 million in a Series C funding round led by Activant Capital, bringing the total amount of capital raised to $70 million.
The funding will enable the company to improve its machine learning capabilities so that it can stock warehouses in line with demand predictions, create fast and affordable shipping programs for new online marketplaces and build its team across the company's three offices in San Francisco, Chicago and Toronto, the company said in a blog post.
Over the past year, Deliverr quadrupled its warehouse footprint and increased the number of merchants it works with, the company also said.

Dive Insight:

Deliverr is one of many companies trying to perfect the online delivery formula. As noted in its funding announcement, the company is trying to provide Amazon-like fulfillment capabilities to online retailers regardless of their size, so that they can compete with larger marketplaces and meet consumers' expectations.

"We now live in a world where consumers expect their online purchases to arrive at their doorstep almost instantaneously," Steve Sarracino, founding partner at Activant Capital, said in a statement. "While massive businesses like Amazon have the scale and expertise to make this a reality, the vast majority of online retailers simply can't meet this expectation on their own. ... Deliverr is filling the gap between what shoppers demand and what online retailers offer."

Amazon has played a critical role in changing consumers' order fulfillment expectations. The e-commerce giant's ability to fulfill orders within a day has helped drive sales. Other major retailers, such as Office Depot, Best Buy and CVS have improved their fulfillment times to less than two days, per research from Accenture Strategy.

As has been the case with the holiday season, efficient delivery can be a major distinguishing factor among retailers. And as a result, retailers have been working to improve their fulfillment efforts through strategies like using their physical stores as fulfillment centers and creating their own distribution operations within the company.