A Postmates/Ford self-driving delivery vehicle image: Postmates/Ford

Postmates confidentially filed for an IPO this February but there has been no follow-up after that. Conventionally, companies that confidentially file for IPO tend to unveil their official S-1 filing soon after. This occurred in the case of Slack, Uber and Lyft, which all went public this year. Postmates’ case has been quite odd, with no official talks on an IPO even months after a confidential filing. But there might just be an explanation.

 A new report from Vox’s Recode says Postmates has held acquisition talks with at least three suitors, including Walmart, Uber and DoorDash. The on-demand delivery company is said to have hired Qatalyst Partners to explore a sale. Qatalyst is a famed boutique investment bank that has been involved in several tech acquisitions, to name a few: Looker [recently acquired by Google for $2.6 billion], HotelTonight [purchased by Airbnb], Qualtrics [acquired by SAP for $8 billion], Duo Security [acquired by Cisco], PillPack [acquired by Amazon], Datorama [acquired by Salesforce], Shipt, Weebly, Magento, Glassdoor and more.

Citing an unnamed person briefed on Postmates’ plans, Recode reports the company is trying much to avoid an IPO, preferring an acquisition instead. Recode’s report also says Postmates is trying to keep its options open, including pursuing its delayed IPO, or raising new funding that could push the need for an IPO farther.

A business owner tracks a Postmates order on a Square point-of-sale terminal image: Postmates

Although Postmates was an early mover into the food delivery market, its traction didn’t match that of competitors like Uber Eats and DoorDash, which control roughly 20% and 32% of the food delivery market respectively [according to Second Measure data], compared to Postmates’ 10% market share.

Recode reports Postmates shopped itself to Walmart for a price hovering around $2 billion, only a slight bump from its recent $1.85 billion valuation. This may be indicative of Postmates preferably wanting an acquisition instead of an IPO. Postmates facing intense competition in a crowded market may breed pessimism from investors on the public markets. The company may also be yet to turn a profit, which conventionally draws skepticism on the public markets.

On the other hand, a spokesperson for Postmates disputed Recode’s report but didn’t specify on record what the company was actually objecting. The spokesperson pointed to the already cited above Second Measure data that showed Postmates is growing faster than GrubHub and Uber Eats in the U.S. although with less market share.

Amid the reported acquisition talks, Postmates has as of late added fuel to its team. The company recently poached a long-time engineer from Apple and also added Google’s vice president of finance, Kristin Reinke to its board.

Share this...

Facebook

Pinterest

Twitter

Linkedin

Whatsapp

Email

Print