Groupon has acquired OrderUp, a food delivery service that caters to over 40 cities and 25 states in the United States.
The price of the deal was disclosed, but the six-year-old food service company, which claims to have served over 10 million people, couldn’t have come with a cheap price tag.
Groupon saw a slow decline in the past few years as the “daily deal” concept, making the company thrive, got some competition.
CEO of Groupon Eric Lefkofsky said,
“The potential in delivery and takeout is apparent –especially with the growth of mobile – and OrderUp’s operational ability, coupled with Groupon’s engaged customer and merchant base, bring tremendous scale to the space.”
The company has long since been established in the coupon giving business, ideal for large groups of people who are on a budget.
What makes OrderUp different from its competitors such as GrubHub and Eat 24 Hours is that it has its own delivery system.
OrderUp allows for restaurants who don’t normally deliver to have drivers do it for them; this is especially the case for places that don’t have enough staff or the capability to set it up. Without this feature, restaurants limit themselves to only certain cliental and the money that’s to be made off of delivery costs.
Owner of Di Pasquale’s Marketplace Joe Di Pasquale said,
“When I heard about OrderUp, I was very hesitant. Customers asked us all the time about delivery. However we didn’t have the staff or know-how to organize our own delivery service. OrderUp is the perfect fit for Di Pasquale’s. It’s the easiest way to start a delivery service. Honestly, I should have done it earlier.”
OrderUp uses contracted drivers who can either accept or deny a potential delivery based on their own hours.
In the announcement, OrderUp wrote that Orlando and Cincinnati will be two of the newest cities to have access to the delivery service.
Revolution Ventures managing partner Tige Savage, who is an investor in OrderUp said,
“Consumers love the convenience of ordering online. Yet, outside the major metropolitan markets, its shockingly difficult to find online food delivery options.”
OrderUp sees this acquisition as a great opportunity for the company to expand its outreach.
CEO of OrderUp Christ Jeffery said,
“Groupon’s reach and ability to connect supply and demand at scale make it the perfect destination for us to grow even faster and expand in our targeted local markets. We look forward to bringing the thousands of great restaurants that we feature to hungry Groupon customers across the country.”
Despite the acquisition, OrderUp will still function as a standalone company and will keep their headquarters which are set in Baltimore. This will all be done while still promoting themselves through Groupon’s merchant pages, called Pages, which were created in 2014.
In a press release, it’s described as giving users access to
“ratings, tips, money-saving opportunities and other useful information for local businesses in the United States.”
The feature is similar to that of Yelp and will be a great feature to help promote OrderUp.
This is not the first combination between food delivery services. GrubHub and Seamless are two takeout food establishments that primarily generate business through computer and phone.
The thing that makes this merging of Groupon and OrderUp so different is that they are each bringing something to the table, with Groupon having a background in a variety of deals and OrderUp’s delivery feature.
Image: Via OrderUp