Investment in app
Ex-Sainsbury’s CEO King backs Snappy Shopper
Justin King: investor
Former Sainsbury’s boss Justin King has taken a stake in a Dundee-based grocery delivery app.
The Snappy Group said Mr King was now a senior adviser to it and had made “a significant personal investment” as the fast-growing convenience technology platform looks to scale up through a £12m Series A fundraising.
The group’s Snappy Shopper app service offers goods from local convenience stores in 30 minutes.
Founded in 2017 by Mike Callachan, Alan Reid and Scott Campbell, Snappy now has 1,150 local store owners signed up to its platform, from just 220 in 2019.
It has been boosted by lockdowns, and is one of a number of emerging rapid delivery operators aiming to fulfil growing online food and drink demand.
A similar service for supermarkets is provided by Deliveroo while there are other start-ups in the sector such as Weezy, Dija, Zapp and Getir.
However, Snappy cover smuch more of the UK, with most of its rivals currently confined to parts of London and selected other cities.
It partners with convenience stores including Spar, Nisa and Costcutter, directing users of its app and website to the nearest local participant.
Mr King told The Sunday Times: “They are fantastic distribution assets, but they don’t have the wherewithal to go online.”
Mr King, who was chief executive of Sainsbury’s between 2004 and 2014, will become a non-executive director once its current fundraising round is complete.
As a tech platform, Snappy Shopper is attempting to level the playing field with supermarkets by giving smaller players the same opportunity they have to reach shoppers at home.
Mr King, who is also a non-executive director at Marks & Spender, told The Grocer: “I have been hugely impressed by Snappy Group’s affordable solution, leadership team and rapid growth.”
Snappy has also developed a Hungrrr app, which offers restaurants, pubs and hotels a ‘white label’ alternative to the likes of Deliveroo and Just Eat, with Hilton Hotels, BrewDog and Subway among its clients.
The Series A fundraising follows several seed capital investment rounds backed by Scottish investors, including Kelvin Capital, Scottish Enterprise and Mercia Asset Management.
The latest cash call is understood to value Snappy Shopper at £50m-65m, with King’s stake between 1%-5% depending on share option performance.
King added: “This is an exciting and pivotal time for the business and I believe I will be able to add significant value. I look forward to working with the management team as the business continues its expansion and grows its market share further within the thriving UK convenience market and beyond.”
The founders were behind web development company mtc, whose customers include BrewDog, Umbro, Innis & Gunn, and Macdonald Hotels & Resorts.
Chairman Mr Callachan said Snappy Shopper was excited to have been able to attract Mr King’s interest and investment.
“Prior to the pandemic, the Snappy Group was already established in both hospitality and grocery home delivery,” he said.
“The lockdown has served to accelerate the online trend, but we strongly believe that the shift in consumer behaviour will persist in the long term.
“While we expect the rapid rate of growth in deliveries to slow slightly as lockdown eases through the summer months, the online market is a long way from maturation.”