Dive Brief:

• Instant delivery firm Jokr is shutting down its operations in the U.S. and will make its last deliveries in Boston and New York City on Sunday, the firm wrote in a Wednesday post on Instagram.
• Jokr will instead focus on growing its presence in Latin America and plans to eliminate 50 workers out of its global workforce of 950 as part of a restructuring but will keep some of its staff in New York, according to Bloomberg.
• In the Instagram post, the company attributed its decision to close its U.S. operations to “this period of global economic uncertainty.”  

Dive Insight:

Jokr’s exit from the United States continues the consolidation of the ultrafast delivery sector in the country as the space faces dwindling investor funding and a challenging economic environment. 

In a statement provided to Grocery Dive, Jokr CEO and co-founder Ralf Wenzel said the company decided to focus its resources on Latin America because that region is “particularly underpenetrated and underserved,” adding that the U.S. only accounted for about 5% of Jokr’s business.

“We greatly appreciate the hard work and commitment of our US team, and we don’t take this decision lightly,” Wenzel said. “However, the experiences in the US market have vastly benefited our core business in Latin America to appreciate customer demand and sensitivities at the highest level.”

Jokr is considering whether to sell or close its nine U.S. micro-fulfillment centers, according to Bloomberg. The company has 200 MFCs globally. 

Instant grocery delivery startup @Jokr_US is exiting the market. pic.twitter.com/YKO167tlDh

— Lauren Elkies Schram (@LaurenESchram) June 16, 2022

Founded in New York City last March, Jokr brought its operations to cities in Europe and Latin America and arrived in Boston in December, when it also announced a $260 million Series B round that raised its valuation to $1.2 billion. The company left Europe after failing to find a buyer for its operations there, Insider reported in April. 

The company has raised a total of $430 million, per Crunchbase. 

The Information reported in January that Jokr has held talks to sell its New York operations. Yet in recent months, the company has had a robust list of “launch manager” roles across on the U.S. on its job page. 

In recent efforts to diversify its business, Jokr announced last month it had launched a retail media platform in the U.S. and the five Latin American countries where it operates — Colombia, Mexico, Peru, Chile and Brazil.

To help the company stand out from competitors, Jokr rolled out earlier this spring a new mobile app with a personalized shopping experience and automated content curation.

Jokr joins a growing list of rapid delivery firms that have recently closed up shop stateside. Earlier this year, Buyk and Fridge No More closed their businesses. Short-lived 1520 closed last year. 

Gorillas, which paused its U.S. expansion plans last summer, announced last month a layoff of 300 corporate employees, noting it is considering “strategic options” for its operations in four European countries. Co-founder and CEO Kagan Sumer said at the time that the company will increase its investments in its “core markets: Germany, the Netherlands, the U.K., France and the U.S.”

Gorillas noted that tech companies are facing a challenging funding landscape. Retail experts have said they expect consolidation in the cash-burning space. Celia Van Wickel, senior director of digital commerce at Kantar, previously told Grocery Dive that the remaining emerging players need to diversify their operating models.