How Gopuff Works: Gopuff Business Model And Revenue Resource

Getting items ordered and delivered makes our lives much easier and simpler as the retail on-demand delivery sector evolved magnificently in a shorter span of time. Moreover, other segments are not so far in terms of adopting a digitized form. At the same time, Gopuff is a type of venture that delivers daily household essentials within 30 minutes at its consumer’s doorsteps.

According to sources, the grocery delivery market is said to witness huge demand in the future by analyzing the current bolstered figures of the market. Especially after the arrival of the COVID-19 pandemic, the retail delivery market sky-rocketed considerably. Eventually, people adopted the usage of tech stuff in their lives to avoid getting infected by viruses, and since then, they are significantly using this method to meet their needs.

Similarly, by supporting the same methodology, Gopuff offers its customers a range of items online across the entire US. Here in this article, we will cover some information about Gopuff, its history, how it makes money, its business and revenue model.

What is Gopuff?

It is a company running its venture as a virtual retail store providing delivery of household utility products, including food and groceries to app users in a minimal time of 30 minutes. Moreover, Gopuff is situated in Philadelphia, Pennsylvania, founded by students of Drexel University: Rafael Ilishayev and Yakir Gola in 2013.

Formerly, a firm started its venture by offering hookah delivery services, then later, with further advancements, they began to deliver goods and foods which are sold in the provision stores. It has also occupied Fancy, a UK-based meal delivery service, Liquor Barn, a chain of alcoholic beverages, and RideOS for $115 million in 2021.

GoPuff’s History:

Launched in: 2013
Founders: Yakir Gola, Rafael Ilishayev
Headquarters: Philadelphia, Pennsylvania, US
Total Funding Rounds: 11

Announced Date Transaction Type Number of investors Funding Amount Investors
June 3, 2016 Series-A Gopuff 2 $8.25 Million Young, Vicki M.
December 1, 2016 Series-B Gopuff 2 $13 Million Headline
December 1, 2017 Series-C Gopuff 3 $42.5 Million Valor Equity Partners
November 1, 2018 Series-D Gopuff 2 $108.5 Million Accel
August 8, 2019 Series-F Gopuff 4 $377.5 Million Accel, D1 Capital Partners
March 23, 2021 Series-G Gopuff 8 $1.2 Billion D1 Capital Partners, Fidelity Management, Research Company
July 30, 2021 Series-H Gopuff 9 $1 Billion Not Disclosed Yet
December 14, 2021 Venture Round Gopuff 1 Not Disclosed Yet Not Disclosed Yet
December 23, 2021 Series-D Gopuff 1 Not Disclosed Yet Not Disclosed Yet
May 18, 2022 Funding Round Gopuff 1 Not Disclosed Yet Robert Iger

Total Amount Received in Funds: $3.4 billion (Source: Crunchbase)
Industry: Retail

How Does GoPuff Make Money?

Finally, when earning money comes into picture, the company earns from different streams of revenue mentioned below, which is about $1 billion approximately.

Markup:
The company’s revenue stream is quite unique when compared to other market players. Gopuff purchases the products in a lot stores them, and sells them in a straightaway manner to buyers, and that’s how they make money.

A firm earns on receiving each order. As there is simple logic behind the generation of enormous revenue, that is the difference between actual price and other charges inclusive of purchasing and storing items through which a firm capitalizes its income.

Fam Subscription Plan:
Gopuff generates revenue on each Fam subscription of its users. The company charges some amount of value from its customers by offering the delivery of products free of cost to them, twice the points on each order, and by providing other deals to its Fam members exclusively.

Delivery Charges:
It charges delivery fees in fixed proportion from its consumers, who are not a part of Fam described above. A firm earns money through each order it receives and also an extra amount as a commission from the user for providing them with an alcohol delivery.

They don’t charge any delivery fee for products at the customer’s doorsteps on orders beyond $49. Besides that, they generate decent revenue on below $49 purchases.

Advertising:
Gopuff makes an income through various brands which are interested in posting advertisements of their products on an application. There must be tons of people visiting an application on a daily basis, companies ranked on top through ads can prove to be beneficial for them.

GoPuff’s Business Model: Take A Glance At Its Various Tactics Implemented


A firm promises to provide the delivery of particular ordered items within a period of 30 minutes; if they fail to do so, they will allow you to refund the amount of the products ordered. To offer timely delivery, they have set up micro centers for fulfillment and an enormous delivery man network across various locations.

Besides this, let’s understand the tactics followed by Gopuff.

Value Propositions:

The business model of Gopuff contains value propositions for its three stakeholders, which include: buyers, delivery providers, and merchants. The consumer orders essentials through an application, instead of merchants packing the ordered items and forwards to deliver them, here, providers are assigned to deliver products by picking them from nearby inventories within half an hour to their customer’s location.

Customers:

  • Can order daily household utilities required
  • Get them delivered within a shorter time period
  • Receive options to choose from a vast range of products

Delivery Provider:

  • Can work according to their availability as Part-time or Full-time
  • Receive more orders to deliver
  • Can get additional tips from customers

Merchants:

  • Can receive orders in bulk quantity
  • Eases down the management
  • Simpler access to the various components of the enterprise

Final Words:

If we talk about a rivalry in the delivery sector, then there are many competitors in the market ready to beat newly entered ventures in a particular segment. Hence, to stay afloat in the market, mobile solution is an effective platform for your business to step into the online delivery segment. We provide the customized solutions created with an appropriate technology that helps the platform to satisfy the necessities of your enterprise. Contact us to know more.

Having More than three years of experience, Nirav is an outreach expert at Elluminati Inc. Having a keen interest in communication, content, and digital marketing, he has worked with many brands and helped entrepreneurs to establish an online presence that drives their business forward.