Gopuff to cut hundreds of jobs

Gopuff, the Philadelphia-based service whose drivers deliver beer, snacks, and other products, is cutting 6% of its workforce, founders Yakir Gola and Rafael Ilishayev told staff in a memo early Thursday.

Gopuff officials declined to say exactly how many people still work for the company, or the number of people who will be let go. Managers told staff that “we’ll know by 2 p.m.,” said a Gopuff employee who works at the company headquarters on North Third Street. The employee spoke on the condition they not be named.

Those facing termination will be summoned to remote meetings with their bosses. Gopuff has pledged severance pay, continued health care for a time, and even equity ownership for laid-off staff, no matter how long they worked.

“This effort will be centered on the reduction of our US corporate workforce,” the founders said in their statement to staff. “This is difficult and not something we take lightly. You all bleed blue [Gopuff’s brand color] and we will be forever grateful.”

The company, which in 2022 employed around 15,000 after raising more than $4 billion from private investors — including SoftBank, Guggenheim, Fidelity Investments, and Disney CEO Bob Iger — now employs fewer than 10,000.

Backers hoped Gopuff would sell shares to public investors in a multi-billion-dollar initial public offering (IPO) like the stock sales that enriched the founders of Uber, DoorDash, and other delivery services.

But that hasn’t happened. Slowing growth and investor pressure led to Gopuff’s 2022 decision to lay off 1,500 staff and shut scores of underperforming warehouse centers. The company later laid off managers, and it pulled out of some of its smaller markets in the U.S. and elsewhere, including France. The company still operates in large U.S. metro areas and the United Kingdom.

Despite that strategic shrinkage, Gopuff has continued to announce new initiatives, including an April 26 partnership with Misfits Market, a formerly Philadelphia-based grocery company, and a 20-minute delivery promise for members of one of the company’s membership services.

The founders added that Gopuff has achieved operating profits and boosted sales at existing stores (which picked up some of the traffic from closed-down stores) by 22% over the past year. A person familiar with the company’s plans said Gopuff hopes to show its investors that is profitable on a net-income basis by the end of the year.

“The road ahead with fewer resources will be challenging at first, but we know the long-term outcome will be significantly better,” the founders added. “We need to stay laser-focused on innovating for our customers, ruthlessly prioritizing, and operating more efficiently.”

Gopuff was founded in Philadelphia in 2013. The founders met in a business school class at Drexel University and started the business as students, on a shoestring budget. Ilishayev worked in the family sandwich shop and catering business. Gola worked for his father’s precious-metals shop. They offered a kind of “Wawa on wheels,” delivering snacks to students at all hours.

At a time when Amazon and other delivery services were growing rapidly, Gopuff attracted more than $1 billion from investors in Silicon Valley, New York, Japan, and Saudi Arabia, and used the funds to open new centers in college towns and city neighborhoods that attracted young professionals.