Business Startups Venture

Tracking The Juno, Plated Shutdowns As The Startup Funding Boom Continues

In a year that’s seen a number of large rounds and success stories (and some drama too – WeWork, we’re looking at you), there’s inevitably going to be some stories that fall in the not-so-successful category.

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Today, we’ll look at two companies that have ceased certain operations over the past week: Plated and Juno. A tweet shared by NPR reporter Mary Childs shares a screenshot of ride-hailing app Juno’s “sad” announcement of its “service coming to an end” from this morning. Childs also shared a screenshot of meal-box subscription service Plated “closing down” its subscription operations after its “last box ships on November 26.”

The news of Juno’s demise is not entirely shocking as Quartz had reported earlier this year that the company was seeking a buyer.

In a press release issued today, Juno parent company Gett announced the news while at the same time unveiling a “strategic partnership with Lyft  to enable Gett’s corporate clients to access rides in the United States beginning next year.”

In the release Gett CEO Dave Waiser said this move reinforced his company’s “strategy to build a profitable company focused on the corporate transportation sector.”

The company also blamed “the enactment of misguided regulations in New York City earlier this year.” It noted that Juno drivers would be paid in full by Juno for all rides completed by Juno’s service end-date, and that “all Juno riders will be invited to join Lyft.”

Juno was founded in 2015 and raised its Series A in June 2016, according to Crunchbase. It was acquired by Gett for $200 million in April 2017.

Gett, which has raised $813 million in total funding, according to Crunchbase, has made three acquisitions to date: Juno, StreetSmart, and RadioTaxis.

Business Insider covered the news of Plated’s closure on November 13, saying the company was “shifting the brand to become one of the grocery retailer’s [Albertsons Companies] private label products.”

In a November 12 press release, Albertsons said the phaseout was “giving way to a sharper focus on how the brand can help deliver a differentiated in-store experience.”

“Our vision for Plated includes an expanded set of products that goes far beyond a dinner-based solution and into a comprehensive in-house culinary brand,” said Geoff White, EVP & Chief Merchandising Officer, in the press release. “With a broader scope of offerings, we see Plated solving customer demands around convenience, lifestyle, and cooking experience, while adding yet another layer of interest to our in-store journey.”

Before being acquired by Albertsons for $200 million in 2017, Plated had raised a total of $56.4 million in venture funding from the likes of Greycroft and Formation 8.

Meal delivery is not for the faint of heart. Earlier this year, we covered the news of prepared meal delivery service provider Munchery abruptly shutting down. Founded nearly a decade prior, the company had raised $125.4 million from the likes of Menlo Ventures, Greycroft, and Northgate Capital.

The Market Moment

Seeing startups shut down is not, by itself, very notable. Something that is worth considering, however, is that we’re still seeing the shaking-out of two startup categories that were once the darlings of the venture market.

Prepared meal delivery was once attracted hundreds of millions of venture capital before the Blue Apron’s implosion stuck a fork in the entire enterprise; as it turned out, meal delivery had pretty rough customer churn. That fact turned a cohort of businesses that appeared to be worthy of a high valuation multiples into a set of companies that lost money and were actually worth about as much per dollar of revenue as a grocer. Which is to say not much.

On-demand ride startups feel much the same. Once they were the hottest companies on the planet, accepting a rising tide of venture dollars that lifted a whole group of boats. Now, as Uber and Lyft struggle to carve a path towards profits as their shares drag and Didi itself having a rough time, seeing shutdowns isn’t a huge surprise.

So while we’re merely looking at two somewhat modest closings, the pair feel more like end-caps on prior market enthusiasm. Who knows, perhaps they mark the nadir of their respective startup categories and better days ahead.

Illustration: Li-Anne Dias

 

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