Uber continued to expand its services on Tuesday when it purchased alcohol delivery service Drizly. In the deal, Uber bought the app for $1.1 billion in stocks and cash, a sum that is a testament to Drizly’s success over the past year. Uber has said that it expects the deal to close in the first half of 2021 and that 90% of that $1.1 billion will be paid to Drizly shareholders in the form of Uber stock, with the remaining balance being paid out in cash.
Drizly, which is like Instacart but with a focus on alcohol sales, has grown 300% year-over-year thanks to its ease of use and specialization. Because the app partners with liquor stores and other markets, they are able to offer prices that are much more competitive than other apps that offer similar services such as Instacart or Postmates.
Following the purchase, Uber will integrate Drizly’s marketplace into its Uber Eats service while still offering the standalone Drizly app. Uber hopes that this acquisition will continue to drive users to its Uber Eats service, dovetailing off the growth that both Uber Eats and Drizly experienced due to the COVID-19 pandemic.
In a press release, Uber CEO Dara Khosrowshahi commented on the acquisition and Drizly’s recent success, saying, “Wherever you want to go and whatever you need to get, our goal at Uber is to make people’s lives a little bit easier. That’s why we’ve been branching into new categories like groceries, prescriptions and, now, alcohol. Cory and his amazing team have built Drizly into an incredible success story, profitably growing gross bookings more than 300 percent year-over-year. By bringing Drizly into the Uber family, we can accelerate that trajectory by exposing Drizly to the Uber audience and expanding its geographic presence into our global footprint in the years ahead.”
In the same press release, Drizly co-founder and CEO Cory Rellas reflected on the company’s growth since its launch in 2012 and looked to the future for the app and its team, saying, “Drizly has spent the last 8 years building the infrastructure, technology, and partnerships to bring the consumer a shopping experience they deserve. It’s a proud day for the Drizly team as we recognize what we’ve accomplished to date but also with the humility that much remains to be done to fulfill our vision. With this in mind, we are thrilled to join a world-class Uber team whose platform will accelerate Drizly on its mission to be there when it matters—committed to life’s moments and the people who create them.”
This deal is a big one for Uber, continuing its mission in expanding its platform and buying out other competitors. Uber has recently bought Postmates and the addition of Drizly is surely a big win after the company’s failed attempt to buy GrubHub.