Grocery delivery startup MilkRun collapses, blaming economic conditions
Fast delivery company MilkRun will close this week and all staff made redundant after the much-hyped startup failed in its quest to change the way people receive their groceries.
The Australian Financial Review first reported on Tuesday that one of the local pioneers of the ultra-fast delivery model would shut down after its founder, Dany Milham, blamed worsening economic conditions.
“I’m writing to let you know that we have made the difficult decision to wind down the business, and as a result, MilkRun will cease trading this Friday,” he said in an email to staff.
Milham said that while the business had performed well, market conditions had deteriorated.
More than 400 employees will be made redundant.
Rapid grocery delivery companies gained popularity around the world during the early pandemic years, with venture capitalists ploughing cash into a sector promising to get groceries to their urban customers often within 10 to 20 minutes.
Backed by fleets of either push bikes, electric bicycles or mopeds, the startups are now collapsing in large numbers after funding ran dry in a global economy grappling with high inflation.
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Milham, who formerly headed mattress and furniture company Koala, helped secure a $75m investment in the company early last year, which included backing from the billionaire Atlassian founders, Scott Farquhar and Mike Cannon-Brookes.
MilkRun launched in Sydney before expanding to Melbourne, using a network of warehouses to store groceries near customers. The company began significant job layoffs in February as financial pressures mounted, just months before announcing its plans to shut down entirely.
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