Gorillas is set to raise $250m in funding from existing investors at a reduced valuation, Business Insider reported Friday. Two people with knowledge of the negotiations also confirmed to Sifted that it has ended work with JP Morgan, the investment bank that the scaleup commissioned to help find new funding sources or secure a buyer.
The speedy grocery company has been trying for months to raise funding in order to extend its runway as a downturn in public markets makes private investors more cautious, especially in loss-making companies.
At the end of May, Gorillas cut 320 jobs and this month closed down a rider platform, Street Fleet, which provided riders to Gorillas and Delivery Hero.
Gorillas shot to fame during European lockdown in 2020 and hit unicorn status just nine months after launching — at the time the fastest company to achieve that feat. To this day, it has raised $1.3bn in funding from big names like Tencent, DST Global, Coatue and Delivery Hero.
But market jitters and inflation have proved tough for a company that requires so much cash to run, causing the company to pivot away from an expansion strategy (it recently closed down its market operations in Italy, Spain, Denmark and Belgium) to focus on profitability.
In response, Gorillas said: "Please understand that as a general rule, we never comment on market rumours. Hence, we will not comment on the issue you have raised."
At the end of May, a source told Sifted Gorillas was burning through €60m per month and had just €300m left in the bank. The company last raised funding of $1bn at a $3bn valuation in October last year.
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