Spanish food delivery app Glovo has raised 150 million euros ($167 million) in a fresh round of funding to ramp up hiring and expand internationally.
The financing effort was led by Mubadala, the sovereign wealth fund of Abu Dhabi, and was also backed by existing investors including Germany's Delivery Hero, Swiss investment company Drake Enterprises and European venture capital firm Lakestar, which was an early investor in Spotify.
It lifts four-year-old Glovo's valuation across the $1 billion mark, bringing it into the ranks of Europe's growing club of unicorn companies. The firm is now Spain's second start-up to achieve unicorn status, according to CB Insights, the first being ride-hailing service Cabify. It speaks to the level of interest from foreign investors in Europe's tech industry, which according to Atomico, had lured in over $34 billion in venture capital as of November this year.
The extra cash will be used to help Glovo grow its workforce, said co-founder and CEO Oscar Pierre, with plans to hire 300 new engineers and developers by mid-2020. The Barcelona-based firm also wants to use the additional capital to expand into new territories after entering Poland through the acquisition of local operator Pizza Portal. Glovo said that 40 engineers and 50 tech and product experts would be posted at its new Warsaw office.
Glovo's platform is mostly known for its takeout and delivery service, but the firm also offers a range of other products that are delivered by its 50,000 couriers "on-demand" — typically in under 30 minutes. Food delivery has become a particularly crowded market, with a range of players looking to compete from DoorDash, Postmates and Uber Eats in the U.S. to Deliveroo and Just Eat in the U.K.
"When we started the company we believed that the concept of on-demand had the potential to become a very big part of the way people purchase goods and services," Pierre told CNBC. "Our vision, from day one, has been to become the 'everything app' for city living, giving our customers access to anything they wish to purchase, and then delivering it."
Glovo's boss said that groceries was its second-most ordered product category. The firm signed a deal with French retailer Carrefour earlier this year to provide the latter with fast home delivery. Other than groceries, Glovo also sells pharmaceuticals and has an aptly-named "anything" category where users can request any item. The firm's app is available in 26 countries across Europe, Latin America and Africa.
It hasn't been that long since the company last raised equity financing, with its last fundraising being a 150-million euro investment round announced in April. The rush of venture capitalists into fast-growing tech companies has been tested of late with the plummeting share price of Uber and WeWork's botched initial public offering (IPO). Both firms have been plagued by concerns over their cash-burning business models.
Pierre put to bed any suggestion that his firm might be running out of money. He claimed Glovo had actually reached operational profitability in its home market of Spain, though the overall business remains lossmaking. As for an IPO, Pierre says he hasn't given it any consideration. "It's not a priority for Glovo right now and not something we're thinking about," he said.
The news also marks a further drive from the United Arab Emirates into the tech sector. The oil-rich country has been increasingly moving to diversify its economy, plowing hundreds of millions of dollars into local start-ups. Despite Abu Dhabi's wealth fund being the lead investor in the round, Glovo's CEO said there were no plans to expand into the Middle East. But, he added, "we never say never."