The infusion of capital will be used to support Deliv’s growth, enhance its product depth and breadth and broaden its national footprint.
Deliv founder and chief executive officer Daphne Carmeli said the funds will “allow us to rapidly scale and advance our position in this multibillion-dollar same-day delivery market. We’re building a significant business.”
Asked about the significance of UPS’ involvement, Carmelli said, “They’re the largest transportation carrier in the world. Our business is unique in that we’re not a consumer type of solution. We’re the plumbing behind the scenes when you check out of a Macy’s or Express. We’re the guys picking up and delivering.”
Establishing an early partnership with the shopping mall owners and operators has been key to Deliv’s platform, allowing the company to bundle all of the deliveries from one pickup location. “It gave us access to retailers and helped with the delivery economics,” Carmelli said. “[UPS] understands logistics. They’re so interested in learning about our business. For example, what is real-time route optimization and how can we disrupt in this last mile? It made tremendous sense to have a strategic investor. It adds another level of insight than another financial investor would have.”
Carmelli said that Deliv’s asset-free logistic network has paid off. The company in 2015 more than doubled the number of markets it serves to 17, including 100 cities. The popularity and demand for the service has increased ten-fold, she said. Deliv has expanded its service to include e-commerce sites such as Google, Farfetch, Bouqs and Plated.
The charge for same-day delivery from macys.com or bloomingdales.com is a flat $5 above standard ground shipping fees. Runners pick up the packages once the mall receives a notification of the order. The runner picks up parcels from other stores, then turns them over to a driver. Deliv also handles returns for many retailers.
“Our Strategic Enterprise Fund continues to invest in companies that have innovative business models,” said Alan Gershenhorn, executive vice president and chief commercial officer of UPS. “We look forward to gaining further insights into the market dynamics of same-day delivery.”