Blue Apron on Its IPO Screw-Up at Codecommerce

blue-apron-codecommerce

Since Groupon has there not been a similarly botched IPO as we witnessed this year with Blue Apron. The meal-kit company wanted to go public for $3 billion, went actually public for $2 billion and today is worth $1 billion.

At this week’s Code Commerce conference, Blue Apron founder Matt Salzberg talked about this and other issues:

“We’re not going to go and be a head-to-head mass-market grocer like Amazon and Whole Foods are trying to be,” he said. “We don’t want to be everything to everybody. We are a curated brand with a point of view on home cooking … and that lifestyle that surrounds that.”

“We’re going after a gigantic, gigantic market opportunity, and we think we’re in the very earliest innings of a gigantic transformation of the offline food industry,” he later added.

Watch the full interview here:

Matt Salzberg is confident and expressed amazement at the public disregard for the company’s entrepreneurial performance. He sees the main challenge now in getting comfortable with the new situation as a publicly traded company.

Meanwhile, other meal-kit companies in the US explore exits in the wake of the Blue Apron IPO which explicitly don’t include going public. The Information (paywall):

Executives at Albertsons Companies, which owns Safeway, have recently discussed buying meal-kit startup Plated, according to two people familiar with the matter. It’s unclear whether the two sides are close to an agreement. […]

Investors say enthusiasm for companies that deliver grocery ingredients has cooled in part because of a high rate at which customers have halted their subscriptions. Their potential profitability also has been an open question. The services still need to justify that it is less expensive and more convenient than grocery shopping or eating at restaurants, according to a March report from Raymond James. There also is debate over how large the potential market is of people who want to regularly use these services. […]

Consumer-packaged goods companies are another possible buyer of meal-kit firms. Some are already investors in the startups. Nestlé led a $77 million funding round in June for Freshly, which ships prepared food to homes, while Campbell’s Soup Company has invested in Chef’d, a Blue Apron competitor that doesn’t require customers to book a weekly subscription and also worked with companies like The New York Times to sell branded meal kits.

This ‘panic’ seems a bit premature. Meal-kits are still a fascinating way to bundle food and create a service and business around that bundle.

HelloFresh, no. 2 in the US and internationally active, may or may not go public as well this year. Investor Rocket Internet certainly could use an IPO exit by now, but the Blue Apron IPO made this one far more complicated and uncertain.

After Blue Apron’s numbers shenanigans we could certainly use another set of numbers on the meal-kit business. (HelloFresh is already publishing some numbers. See for example this latest quarterly report from June (PDF).)

By Marcel Weiß and Jochen Krisch

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