Getir bets big on the U.S. even as it bleeds cash

Getir bets big on the U.S. even as it bleeds cash

In late 2021, Turkish startup Getir entered the fiercely competitive U.S. market with ambitious plans to disrupt the quick commerce industry. However, as we fast forward to today, Getir is grappling with significant challenges and a substantial drop in its valuation.

Getir made its mark in the U.S. with a splash. The company, which once boasted a valuation of over $12 billion, dazzled American consumers with promises of ultra-fast grocery delivery, often within minutes, even in unfavorable weather conditions. The startup’s strategic approach included hiring Gen-Z brand ambassadors, flooding the streets with advertisements, and partnering with major sports teams like the New York Mets.

Despite the initial hype and lofty valuation, Getir’s journey in the U.S. has been a turbulent one. The startup’s valuation has plummeted by nearly 80%, now resting at $2.5 billion, reflecting the challenging times it’s navigating. While Getir managed to secure a $500 million cash injection in September, it’s reported to be hemorrhaging around $100 million each month.

In an industry known for fierce competition and thin profit margins, Getir’s challenges are not unique. To achieve long-term viability, the startup will need to tackle fundamental issues with its business model. Unlike some of its competitors like Instacart, which aggregate orders from various stores, Getir takes on the role of both retailer and distributor. This approach enables speedy deliveries but could weigh it down as it scales. Getir’s goal of providing 10-minute deliveries hinges on keeping costs low, which is proving to be an ongoing challenge.

To weather the storm, Getir has taken measures like layoffs and market exits, but these actions only address the symptoms, not the root problems. Getir’s business model struggles to break even, with reports indicating losses of up to $20 per order, making it heavily reliant on customer acquisition through discounts.

In a bid to stay afloat, Getir will need to forge partnerships with more extensive players and reduce its capital investments. The emergence of same-day delivery services from U.S. retail giants like Amazon further intensifies the competitive landscape, making it challenging for smaller players like Getir to compete effectively.

For Getir’s employees, the current situation is a mixed bag. While some have raised concerns about the quality of the e-bikes provided, with complaints about faulty batteries, rusty brakes, and unrealistic delivery time expectations, others see potential for improved efficiency. In-store workers, in particular, have cautiously optimistic views of Getir’s management following the merger.

While the path forward for Getir in the U.S. remains uncertain, the startup’s determination to redefine quick commerce is evident. Success in this fiercely competitive industry is a challenging feat, but if Getir can pivot effectively and adapt to market dynamics, it may yet secure a place as a significant player in the U.S. quick commerce space.

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