Blue Apron, a thriving meal-kit delivery service, is reportedly interviewing banks who want to work on the company’s initial public offering. Is this a smart move in such a crowded marketplace? Will their success continue, or is it just a trend?
Is Blue Apron Ready For IPO
There’s been a shift in food culture in the last decade. With the advancement of technology has also come more options for customers when it comes to dining. Americans are no longer limited to ordering pizza or Chinese at home. Apps like Favor, Amazon Now, Postmates, etc. all let users order what they want when they want it. Consumers can even order groceries through Instacart.
And it’s working.
Blue Apron is only four years old yet is on track to surpass $1 billion over the next 12 months. As a result, the company is in talks with banks to launch an IPO with a $3 billion valuation.
Why take the company public now?
While the company is growing quickly, there are definitely problems. Specifically, in the warehouse. Blue Apron was recently the subject of an investigative piece by BuzzFeed News for its warehouse facility in Richmond, California. To compete with rising demand, Blue Apron was accused of loose hiring practice and negligence.
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Employees reported being injured using equipment they were never certified for. There have been fights, threats, and hiring issues galore. Blue Apron eventually cut back on marketing costs to improve labor and hiring practices. But there are still issues in the warehouse. Now the question is can those issues be controlled with an influx of cash? In a crowded marketplace, Blue Apron has been able to set itself apart as the team to beat. With an IPO, the company will have more assets and resources available, as well as a team of experts to get them on the right path.
Watch Blue Apron video in building a better food system from scratch:
Blue Apron will be just fine. The company will launch an IPO, and when it does, be prepared to buy.
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