Office lunch delivery startup Peach cuts 33% of staff; CEO cites failed ‘sales experiment’


Photo via Peach.

Lunch delivery startup Peach has laid off a third of its staff, eliminating several sales and account management roles as it aims to return to profitability.

Peach CEO Nishant Singh. (Photo via Peach)

The Seattle-based company let go of 12-to-13 people, said Peach CEO Nishant Singh, who said a “sales experiment” didn’t work out as he hoped. The company now has 25 employees after the cuts.

“We wanted to see if we could grow heavily using sales, and we did grow, but not as much as we wanted as a venture-backed company,” he said.

Peach competes in a crowded food delivery market, but differentiates itself by focusing on delivering multiple lunch orders to office buildings. Hundreds of companies use the service across four markets.

“Efficiency is a big thing for us because we run a profitable business,” Singh said. “With these cuts, we are now overall profitable and will continue to serve our restaurants, customers and drivers for years to come.”

Peach has raised $10.75 million to date from investors like Madrona Venture Group, Maveron, and Vulcan Capital. Its co-founders — Singh; Denis Bellavance; Chenyu Wang — are former Amazon colleagues.

“There will be experiments that we will do — some will succeed, some will fail, just like how Amazon does it,” Singh said.

Amazon has its own office lunch delivery service called Daily Dish that launched more than a year ago. Both Amazon and Peach use text messaging technology to take orders from customers each weekday from a curated list of restaurants.

Another lunch service targeting office workers called MealPal launched in Seattle earlier this month.

Peach reached profitability this past October. At the time, it employed 55 people and launched in Dallas, its fourth market. The company is in talks with national delivery companies about outsourcing their lunch service to Peach, Singh said.

Startups like Sprig, SpoonRocket, and Maple have all gone out of business in the past few years. But there are others like Dominos, which is using lots of delivery technology and continues to post impressive earnings, or Uber, whose CEO said in January that UberEats is “exploding,” that seem to be finding success.

CBInsights in October noted that activity in the food delivery market “has begun to cool.” Here’s a timeline it created that shows U.S. food delivery startups when they first raised funding, and subsequent mergers, acquisitions, IPOs, or shutdowns:

Via CBInsights.

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