A local network up for grabs
Online food delivery in Latin America is there to stay. Over the past few years, it evolved into a disruptive force within the corporate finance and startup landscape. A striking example is the Colombian on-demand delivery service, Rappi, which secured over two billion U.S. dollars in funding between 2016 and 2022, positioning itself as Latin America's best-funded online food delivery platform.Rappi's expansion has shaken the region's delivery industry, forcing rivals to find new ways to stay competitive. One notable contender is Berlin-based Delivery Hero, strategically seeking to dominate the market through a series of mergers and acquisitions. To tighten its grip on the regional market, Delivery Hero acquired the Latin American operations of Spanish unicorn Glovo in 2020. A year later, it purchased the Salvadoran super app Hugo for about 150 million U.S. dollars. In addition, Delivery Hero's former brand, Domicilios.com, merged with Brazilian iFood in mid-2021.
Pronto is priceless
Not only did the global pandemic reveal a new appetite for restaurant food delivery, but it also exposed other opportunities hidden beneath the surface. In Latin America, some major players in the sector extended their domain to include a wider variety of products, such as groceries and essential commodities. Following the global trend, ultra-fast product delivery services, better known as Quick commerce, flourished across the region.In mid-2020, PedidosYa launched PedidosYa Market, a fully online supermarket with ultra-rapid 15-minute deliveries. A year later, Rappi joined the trend with its q-commerce service Turbo-Fresh. As of 2023, PedidosYa Market operated 175 dark stores, while Turbo-Fresh exceeded this number, boasting over 430 dark stores in 2022. Other regional players, like iFood and Yummy, have also established themselves as speed-based delivery unicorns. Amid such fierce competition, food delivery companies must continuously enhance their offerings, striving to provide more, better, and faster delivery options.
