Meet the boss of Europe's biggest super-fast grocery service

Appropriately for the boss of an app whose bicycle-riding couriers deliver groceries in as little as 10 minutes, Kağan Sümer has been frantically darting around London over the past few days.

The 34-year-old founder of Gorillas is house hunting, seeking out a mews apartment as he considers moving to the capital from Berlin, in between seeing supermarket bosses.

Last Wednesday, Sümer held his first face-to-face meeting with Ken Murphy, Tesco’s chief executive, to discuss expanding a deal in which Britain’s biggest supermarket sells groceries through the Gorillas app.

“We are just scratching the surface with some pilots,” Sümer says. “We believe we can do many different things, delivery is one, building products and creating technologies is another. We are learning from each other.”

Tesco, which has annual sales of £53bn and operates thousands of stores, may seem like a giant compared with Sümer’s company, which was founded less than two years ago. But the rapid rise of Gorillas, amid an explosion of rival instant grocery apps with names like Getir, GoPuff and Zapp, suggests Britain’s big supermarkets should be looking over their shoulders.

Gorillas, founded in Berlin, only launched in the UK last March, but now has 32 warehouses across five cities, from which fleets of riders are dispatched within minutes of a time-poor shopper ordering ready meals, fresh bread, beer or wine. The company eschews the gig economy model. Because they must be available to deliver instantly, the company employs riders who are given shifts and paid by the hour, rather than by the job.

Sümer plans to grow Gorillas’ UK operations up to fourfold this year, conquering London but expanding across cities.

Born in Turkey, Sümer was expected to go into the family construction business. “At some point I said, ‘This is quite slow-moving for me, I want to do something fast paced.’ I told my uncle, “I'm not doing business with you.” And in Turkey if you don't do business with the family, you’re kind of out of the family.”

Sümer worked in Istanbul as a consultant for Bain & Company before moving to Berlin with Rocket Internet, the German start-up factory best known for taking ideas from successful US companies and creating versions for Europe and Asia. Sümer himself was partly inspired to launch Gorillas towards the start of the pandemic by US rival GoPuff.

He started the app, previously known as Get Goodies, from his Berlin apartment, clearing space off his shelves to stock up on items from local supermarkets to sell on. “It was cold outside, so the balcony became the fridge”.

The name Gorillas was plucked partly at random, apparently because of its boss’s love of animals, but seems to have stuck: Sümer sports a new tattoo of a gorilla on his neck, and signs off texts with two gorilla emojis.

Though he still occasionally gets on his bike to deliver orders, and encourages the rest of his executives to do the same, Sümer has bigger challenges these days.

Rapid grocery apps (the industry has settled on the neologism “q-commerce” for quick) invaded and multiplied during the pandemic, as locked-down shoppers avoided supermarkets and were unable to go to restaurants. This was turbocharged by a historic tech boom that fuelled enormous venture capital investments into the companies. More than a dozen have sprung up around Europe, launching a marketing war that has seen their names plastered across buses and train stations, many promising huge discounts for shoppers who choose them over rivals.

But the lightning-fast rise of the sector has turned into a cash crunch almost as quickly. Investors have been unwilling to support companies burning through cash in an attempt to gain market share.

Last year, GoPuff acquired two smaller UK start-ups, Dija and Fancy before launching in Britain, and in November, Getir acquired Weezy. Gorillas, for its part, recently entered exclusive talks to buy France’s Frichti.

“It’s super easy to say ‘Okay, we need to grow at all costs,’ and you make a lot of mistakes,” says Sümer. He says several start-ups, in rushing to expand, chose the wrong places for warehouses, in the process picking fights with local communities.

Further deals are likely if a chill currently running through public tech markets translates into private valuations, but Sümer says he is confident that the company will be predator rather than prey. “The winners will begin consolidating the market because they will be the ones taking the money, and at the moment we are the European leader,” he says.

Rapid grocery apps have also faced questions about whether they can be profitable. In the UK, Gorillas charges a £1.80 delivery fee, although unlike restaurant apps like Deliveroo and UberEats, it is selling groceries directly, allowing it to take profit margins.

Sümer says the company has profitable warehouses in every country, and that 30pc of its business is at break-even. He also points to market data suggesting that the average order on its app is three times that of some competitors. In other words, its city-dwelling users are buying something closer to a weekly shop than an emergency avocado.

He is confident, too, that the model can work outside of built-up cities, despite the app’s initial focus on London urbanites. Gorillas has run trials in suburbs and smaller cities, and says it has found success especially among those for whom an off-licence is not merely round the corner, although it is questionable whether rural locations will ever be an option.

There are signs that the end of lockdowns is leading to declines in online grocery shopping in Britain. Aldi recently shut down deliveries through Deliveroo, and industry data showed internet sales fell 3.7pc year-on-year in December.

Sümer suggests this is hitting traditional grocers’ orders, which take a day or more to deliver, rather than that instant gratification of 10-minute deliveries. “Before q-commerce people were saying they don't use online groceries because of long delivery times and because they want to touch fresh items. With anything that's not instant, if you receive something and it's bad, you cannot consume it. With q-commerce, there's no such thing called delivery times, and if in 10 minutes you receive a bad apple, in 20 minutes, you get the right one. That’s why it’s game changing.”

The UK’s big supermarkets have noticed. Grocers including Tesco, Sainsbury’s and Asda have expanded their own 60-minute delivery services in recent months. Sümer plays down the company’s own threat to the Big Four. “Look at the size of the grocery industry, who are we to be afraid of? But people should get closer to the customer, what the customer wants, what the world wants.”

What would he say if one of the big supermarkets - say Tesco - came knocking with an offer? Sümer says he would have to consider it, although does not sound as if he would leap at a deal. “If the time comes, of course we’re going to evaluate. Of course we have to create value for shareholders. But the key thing is that we have an impact. We are just at the beginning of things.”

Source: The Telegraph