Dive Brief:
- Avo, a startup that offers same-day delivery of groceries and other products to occupants of office and residential buildings, has raised $45 million in a Series B round of funding, bringing the total amount it has raised to $84 million, according to a Wednesday press release.
- The company, which does not have a minimum order requirement or charge a delivery fee, plans to use the funds to broaden its operations to 10 unidentified "major markets" during the next year.
- Avo is taking a unique approach to the fast-growing convenience delivery space by appealing directly to business clients instead of consumers.
Dive Insight:
Founded in 2017 as a distributor of baby food to nurseries in Tel Aviv, Israel, Avo has sought to distinguish itself by bundling delivery services as part of a package of amenities building owners can offer to employees and tenants.
The company's vertically integrated business is centered on delivering groceries, alcohol, personal care products, electronics and other items. Avo also provides event programming in addition to gifting and recognition services.
Avo now serves thousands of residential projects, corporations, hospitals and universities in New York, New Jersey, Houston and Chicago, according to the press release. The company, which also operates in Israel, said it is adding new markets every month and has seen its revenue increase by 1,000% during the past two years.
Dekel Valtzer, Avo's CEO and co-founder, said in the release that office and residential landlords are seeking perks like grocery delivery in order to draw tenants as the pandemic drags on. Valtzer told Business Insider Avo makes its business work financially by bringing multiple orders to a building at once.
Avo is up against a range of companies hoping to draw interest from people looking for grocery delivery, including online convenience leader Gopuff and quick-delivery firms like 1520 and Jokr that promise fulfillment in 20 minutes or less. Grocers including The Giant Company and Kroger, meanwhile, have recently launched 30-minute delivery services with Instacart.
In July, Shipt announced that it was working with landlord Springs Apartments to offer free memberships to residents of almost 60 multifamily developments in states such as Colorado, Florida, Illinois and Texas.
Avo's latest funding round was led by Insight Partners, a venture capital and private equity firm that has also invested in companies like Fridge No More and e-grocer Imperfect Foods. Venture capital firm Kleiner Perkins and JLL Spark, which focuses on property technology startups, also participated.
