The company says the downturn has had a “dramatic impact” on its local commerce fast delivery business.
Almost a year to the day after the close of a major seed round, Toronto-based GoodGood ceased operations after failing to secure additional capital. The local commerce fast delivery startup announced the news Nov. 21 in a statement posted on its website.
GoodGood closed an initial funding of C$6.5m in November 2021 at a valuation of c.$30m, amid clearer economic skies and a much warmer venture capital funding environment. Over the past 18 months, the company has built five cafes and a delivery network covering much of downtown Toronto.
“While we were confident that our business would be able to overcome many of these challenges, we were unable to secure the capital necessary to continue bringing our vision to life.”
But this year, market conditions have deteriorated significantly and GoodGood has been forced to contend with high interest rates, inflation and the prospect of what could be a prolonged economic downturn. According to GoodGood, although these conditions had a “dramatic impact” on the company, GoodGood’s inability to secure more funding in a much more difficult venture capital environment ultimately led to the company’s loss of fast trade.
“The economic realities of rising interest rates, inflation and an impending recession – economic factors that were not a reality when we began this journey – have had a dramatic impact on our business” , GoodGood wrote in the statement. “While we were confident that our business would be able to overcome many of these challenges, we were unable to secure the capital necessary to continue bringing our vision to life.”
When contacted by BetaKit, GoodGood declined to provide further comment. BetaKit has also reached out to some of the company’s investors for additional comment, but none have responded as of press time.
Fast delivery startups in particular have been hit hard by the economic downturn. Bigger space companies like Gopuff and Getir have been laying off staff en masse and scaling back operations, while other Canadian upstarts like Vancouver-based grocery delivery company Tiggy, which closed 6.3 million dollars last year around the same time as GoodGood, suspended services in Toronto and Vancouver this summer.
RELATED: Ritual Alumni Launch GoodGood With $6.5M To Grow Business For Local Food & Beverage Makers
GoodGood was founded in April 2021 by two former employees of Toronto-based social ordering app Ritual, co-founder Robert Kim and senior director of partnerships Kris Linney. Kim and Linney started the fast local trade company after realizing that despite the increased demand for local trade during COVID-19, there was a gap in the market in terms of accessing and discovering handcrafted items like beer and specialty snacks.
“By nature, the [craft] the industry is quite fragmented, and it’s actually hard, relatively hard, to get all of these products easily,” Kim told BetaKit last year.
Backed by a list of top investors including BKCM, Golden Ventures, Maple VC, Tet Ventures, Shopify’s Farhan Thawar and Digital Main Street’s Chris Rickett, GoodGood’s vision was to help communities “easier access and more quickly to local artisans’ products, by operating physical cafes around Toronto and delivering goods to customers in 30 to 60 minutes. According to LinkedIn, GoodGood had 27 employees this week.
“As GoodGood ceases operations, the emerging makers you love will continue to thrive,” GoodGood wrote in the release. “Over the coming weeks, we will be sharing ways to continue supporting these manufacturers by ordering directly or visiting local retailers who share a similar mission of supporting up-and-coming local manufacturers.
Feature image courtesy of GoodGood.
#Year #Raising #Million #GoodGood #Shuts #Find #Money