{"id":337229,"date":"2017-03-31T06:32:48","date_gmt":"2017-03-30T22:32:48","guid":{"rendered":"http:\/\/techcrunch.com\/?p=1471048"},"modified":"2017-03-31T06:32:48","modified_gmt":"2017-03-30T22:32:48","slug":"blue-apron-could-deliver-an-ipo-in-2017-but-should-it","status":"publish","type":"post","link":"https:\/\/people.utm.my\/asmawisham\/blue-apron-could-deliver-an-ipo-in-2017-but-should-it\/","title":{"rendered":"Blue Apron could deliver an IPO in 2017, but should it?"},"content":{"rendered":"<p class=\"first\">Meal kit makers\u00a0<a target=\"_blank\" href=\"https:\/\/techcrunch.com\/tag\/blue-apron\/\">Blue Apron<\/a> may be preparing to file for a 2017 IPO, according to <a target=\"_blank\" href=\"http:\/\/af.reuters.com\/article\/commoditiesNews\/idAFL2N1H604W\">Reuters<\/a>. The report says that the food startup has hired bankers from Goldman Sachs, Morgan Stanley and Citigroup to this end.<\/p>\n<p>The whole thing has stirred up quite the conversation over here at TechCrunch, and we\u2019ve been arguing amongst ourselves about the likelihood that the Blue Apron IPO\u00a0happens soon, or at all.\u00a0For what it\u2019s worth, we have sources saying there is no IPO effort under way for Blue Apron yet, and the Reuters\u2019s\u00a0source may have had his or her own agenda.<\/p>\n<p>There are three obvious possibilities here:<\/p>\n<ul>\n<li>Blue Apron is actually exploring the idea of an IPO. It\u2019s in the early stages, but the company is exploring it nonetheless.<\/li>\n<li>Blue Apron and\/or its bankers\u00a0are floating the rumor of an IPO to attract potential\u00a0acquirers.<\/li>\n<li>Blue Apron neither has\u00a0imminent IPO plans, nor is it interested in an acquisition.<\/li>\n<\/ul>\n<p>Any of the above would make for a fairly standard business tactic and story.\u00a0But here\u2019s the thing: Blue Apron is at the point where it could just sit\u00a0tight.<\/p>\n<p>The company is\u00a0facing lots of\u00a0competition, but it\u2019s an early mover with great brand recognition. The range of M&#038;A suitors one can imagine is broad and varied. While\u00a0Blue Apron is not reported to be profitable\u00a0\u2014 yet\u00a0\u2014 it\u2019s been investing in marketing and expanding its operations, making quite a land grab.<\/p>\n<p>Let\u2019s say\u2026<\/p>\n<h2>Blue Apron is prepping for an IPO<\/h2>\n<p>If this scenario turns out to be true, it wouldn\u2019t be the first time in recent history that an unprofitable company went public with candid warnings that business investment outweighed profits. Snap said in its own IPO prospectus that it may never achieve profitability, <a target=\"_blank\" href=\"http:\/\/www.businessinsider.com\/snapchat-lost-514-million-in-2016-warns-it-may-never-be-profitable-2017-2\">operating at a net loss of $514.6 million in 2016<\/a>.<\/p>\n<p>Remember, profitability isn\u2019t the white whale it once was. Just look at Amazon.<\/p>\n<p>It\u2019s also worth noting that the preparatory stages of an IPO can last a couple of years, if not longer, and that Blue Apron could be merely dipping its\u00a0toes in the water\u00a0to see if it\u2019s warm.<\/p>\n<p>A\u00a0company might go public before stabilizing margins and achieving steady profitability for several reasons. The first is that there is a valid growth strategy in place, and a story that the public market can believe in; meanwhile, the company doesn\u2019t have to carve out more equity for private investors.<\/p>\n<p>There\u2019s also the possibility that investors \u2014 who\u2019ve now provided Blue Apron with <a target=\"_blank\" href=\"https:\/\/www.crunchbase.com\/organization\/blue-apron#\/entity\">nearly $200 million<\/a> \u2014 are pressuring Blue Apron\u00a0to get them an \u201cexit,\u201d beat others to a listing and hope\u00a0public market\u00a0investors will be convinced\u00a0into believing there\u2019s a\u00a0there there.<\/p>\n<aside class=\"inset inset-sm inset-section\">\n<section class=\"aside section video-aside crunchreport collapse collapse-adjacent\" data-video-id=\"58dade3583b51f360520b9e8\">\n<h2 class=\"collapse-title section-title\">Latest <span>Crunch Report<\/span><\/h2>\n<div class=\"collapse-body cf\">\n<ul class=\"vid-list cf\">\n<li class=\"block vid-feature\" data-lightbox-omniture=\"crunchreport\" readability=\"-2\">\n<div class=\"block block-inset\" readability=\"7\"><a href=\"https:\/\/techcrunch.com\/video\/uber-releases-its-diversity-report-crunch-report\/58dade3583b51f360520b9e8\/?ncid=rightrail_cr\"><img decoding=\"async\" src=\"https:\/\/img.vidible.tv\/prod\/2017-03\/28\/58dade3583b51f360520b9e8\/58dade71ad5cd31f2766387c_o_U_v1.jpg?w=300&#038;h=170\" alt=\"Uber Releases Its Diversity Report | Crunch Report\" data-lightbox-url=\"https:\/\/techcrunch.com\/video\/uber-releases-its-diversity-report-crunch-report\/58dade3583b51f360520b9e8\/lightbox\"\/><\/a><\/p>\n<p><h3>Uber Releases Its Diversity Report | Crunch Report<\/h3>\n<\/p>\n<\/div>\n<\/li>\n<\/ul>\n<p><a href=\"https:\/\/techcrunch.com\/video\/crunchreport\/?ncid=rightrail_crmore\" class=\"text-btn\" data-omni-sm=\"rightrail_crmore\">Watch More Episodes<\/a><\/div>\n<\/section>\n<\/aside>\n<p>We think this\u00a0seems improbable, though.<\/p>\n<p>No doubt Blue Apron is tackling a difficult problem. They want to help people eat high-quality food at home in a more convenient way than they could before. And they\u2019re doing a lot of expensive things to solve that problem \u2014\u00a0sourcing ingredients, preparing them, packaging and distributing the final product, while also creating recipes and keeping its\u00a0website fresh. Blue Apron\u00a0also sells wine and cookware.<\/p>\n<p>However, the pre-profitability requirement for any IPO-seeking company is a good growth story. And\u00a0Blue Apron has also continued to grow over the years.<\/p>\n<p>Toward the end of 2014, Blue Apron announced it was serving up <a target=\"_blank\" href=\"https:\/\/techcrunch.com\/2014\/11\/12\/blue-apron-blows-past-1-million-meals-sold-each-month-looks-to-ecommerce\/\">1 million meals per month<\/a>, which averages out to a $120 million revenue run rate, with meals priced around $10 a pop. By the summer of 2015, Blue Apron was operating at a $360 million run rate with 3 million meals sold each month.\u00a0Around the same time, Blue Apron <a target=\"_blank\" href=\"https:\/\/techcrunch.com\/2015\/06\/09\/blue-apron-cooks-up-135-million-in-series-d-funding\/\">ate up $135 million in funding at a $2 billion valuation<\/a>. In April of 2016, Blue Apron was selling <a target=\"_blank\" href=\"http:\/\/fortune.com\/video\/2016\/04\/18\/blue-apron-recipes-for-success\/\">8 million meals per month<\/a>.<\/p>\n<p>Its estimated revenue last year hit\u00a0$650 million, according to an analyst\u2019s note viewed by TechCrunch.<\/p>\n<p>And there\u2019s the added point that Blue Apron struck up a deal with Bill Niman to <a target=\"_blank\" href=\"http:\/\/www.grubstreet.com\/2017\/03\/blue-apron-buys-bill-nimans-bn-ranch.html\">buy BN Ranch<\/a> and supply the company with pastured beef, pork, turkey and chicken.<\/p>\n<p>The stage seems to be set rather nicely for the company to eventually go public.<\/p>\n<h2>Blue Apron is courting suitors<\/h2>\n<p>I\u2019m not saying that Blue Apron\u2019s IPO rumor is merely bait for potential acquirers, but let\u2019s not rule out the possibility that it might intrigue a suitor.<\/p>\n<p>There are a number of obvious candidates: Costco, Whole Foods, Sysco Food Services, Amazon, Walmart or maybe even a food and beverage producer like a Unilever or PepsiCo. And I\u2019m sure there are a few more \u201coutside-the-box\u201d firms also in the running.<\/p>\n<p>Some are less likely than others. While Whole Foods made a <a target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2016-09-23\/whole-foods-invests-in-instacart-at-2014-valuation\">bold investment in Instacart<\/a>, signaling a willingness to bet on the food-tech startups, it also has been <a target=\"_blank\" href=\"http:\/\/www.grubstreet.com\/2017\/03\/kroger-is-stealing-lots-of-whole-foods-shoppers.html\">struggling of late<\/a> to merely hold on to customers. It may have more important fish to fry right now.<\/p>\n<aside class=\"inset inset-sm inset-section\">\n<div class=\"section aside crunchbase-cluster collapse\">\n<h3 class=\"section-title collapse-title\">Crunchbase<\/h3>\n<div class=\"collapse-body\">\n<ul class=\"crunchbase-accordion\">\n<li class=\"data-card crunchbase-card active\" data-crunchbase-url=\"https:\/\/crunchbase.com\/organization\/blue-apron\/\">\n<h4 class=\"card-title card-acc-handle\"><a class=\"cb-card-title-link\" href=\"https:\/\/crunchbase.com\/organization\/blue-apron\/\">Blue Apron<\/a><\/h4>\n<\/li>\n<li class=\"data-card crunchbase-card\" data-crunchbase-url=\"https:\/\/crunchbase.com\/organization\/hellofresh\/\">\n<h4 class=\"card-title card-acc-handle\"><a class=\"cb-card-title-link\" href=\"https:\/\/crunchbase.com\/organization\/hellofresh\/\">HelloFresh<\/a><\/h4>\n<\/li>\n<li class=\"data-card crunchbase-card\" data-crunchbase-url=\"https:\/\/crunchbase.com\/organization\/plated\/\">\n<h4 class=\"card-title card-acc-handle\"><a class=\"cb-card-title-link\" href=\"https:\/\/crunchbase.com\/organization\/plated\/\">Plated<\/a><\/h4>\n<\/li>\n<li class=\"data-card crunchbase-card\" data-crunchbase-url=\"https:\/\/crunchbase.com\/organization\/unilever\/\">\n<h4 class=\"card-title card-acc-handle\"><a class=\"cb-card-title-link\" href=\"https:\/\/crunchbase.com\/organization\/unilever\/\">Unilever<\/a><\/h4>\n<div class=\"card-acc-panel\">\n<ul class=\"card-info\">\n<li><strong class=\"key\">Founded<\/strong> <span class=\"value\">1930<\/span><\/li>\n<li class=\"cb-card-description full\"><strong class=\"key\">Overview<\/strong> <span class=\"value\">Unilever produces and supplies fast moving consumer goods in food, and home and personal care product categories in Europe, the Americas, Asia, and Africa. It offers soups, bouillons, sauces, snacks, mayonnaise, salad dressings, olive oil, margarines, spreads, and frozen foods, as well as cooking products, such as liquid margarines under Knorr, Hellmann&#8217;s, Becel\/Flora, Rama\/Blue Band, Calv\u00e9, WishBone, \u2026<\/span><\/li>\n<li class=\"full\"><strong class=\"key\">Location<\/strong> <span class=\"value\"><a href=\"http:\/\/crunchbase.com\/location\/leatherhead\/9bc76406ba8e7f4c74696938d754fef0\">Leatherhead, N7<\/a><\/span><\/li>\n<li class=\"full\"><strong class=\"key\">Categories<\/strong> <span class=\"value\"><a class=\"\" href=\"http:\/\/crunchbase.com\/category\/food-and-beverage\/14364faa63f90d457b6a7378113364a2\">Food and Beverage<\/a>, <a class=\"\" href=\"http:\/\/crunchbase.com\/category\/consumer\/2357ca1d601deb18c0f1146d91d7aeae\">Consumer<\/a>, <a class=\"\" href=\"http:\/\/crunchbase.com\/category\/home-services\/575b22d6f4d8abba90b292bd25ff2ad2\">Home Services<\/a>, <a class=\"\" href=\"http:\/\/crunchbase.com\/category\/fmcg\/ce027447778c015e63e4b80fd25a1259\">FMCG<\/a><\/span><\/li>\n<li class=\"full\"><strong class=\"key\">Website<\/strong> <span class=\"value\"><a href=\"http:\/\/www.unilever.com\" target=\"_blank\">http:\/\/www.unilever.com<\/a><\/span><\/li>\n<li class=\"full profile\"><a href=\"https:\/\/crunchbase.com\/organization\/unilever\" target=\"_blank\">Full profile for Unilever<\/a><\/li>\n<\/ul>\n<\/div>\n<\/li>\n<li class=\"data-card crunchbase-card\" data-crunchbase-url=\"https:\/\/crunchbase.com\/organization\/walmart\/\">\n<h4 class=\"card-title card-acc-handle\"><a class=\"cb-card-title-link\" href=\"https:\/\/crunchbase.com\/organization\/walmart\/\">Walmart<\/a><\/h4>\n<div class=\"card-acc-panel\">\n<ul class=\"card-info\">\n<li><strong class=\"key\">Founded<\/strong> <span class=\"value\">1962<\/span><\/li>\n<li class=\"cb-card-description full\"><strong class=\"key\">Overview<\/strong> <span class=\"value\">Walmart is a multinational retail corporation that operates several chains of discount department and warehouse stores. The company\u2019s segments include Walmart U.S., Walmart International, and Sam\u2019s Club. The Walmart U.S. segment is a mass merchandiser of consumer products operating under the Walmart or Wal-Mart brands as well as walmart.com. It also offers digital services such as Vudu and InstaWatch. \u2026<\/span><\/li>\n<li class=\"full\"><strong class=\"key\">Location<\/strong> <span class=\"value\"><a href=\"http:\/\/crunchbase.com\/location\/bentonville\/b313fed852a1b2c3340ddb25229a411c\">Bentonville, AR<\/a><\/span><\/li>\n<li class=\"full\"><strong class=\"key\">Categories<\/strong> <span class=\"value\"><a class=\"\" href=\"http:\/\/crunchbase.com\/category\/e-commerce\/275ddcbc27deff4f4e506dc26ebf9570\">E-Commerce<\/a>, <a class=\"\" href=\"http:\/\/crunchbase.com\/category\/retail-technology\/93872d37a1f6a0afb9e20b150c79f8eb\">Retail Technology<\/a>, <a class=\"\" href=\"http:\/\/crunchbase.com\/category\/retail\/b65acba5b299399063908be3e3833a07\">Retail<\/a><\/span><\/li>\n<li class=\"full\"><strong class=\"key\">Website<\/strong> <span class=\"value\"><a href=\"http:\/\/www.walmart.com\" target=\"_blank\">http:\/\/www.walmart.com<\/a><\/span><\/li>\n<li class=\"full profile\"><a href=\"https:\/\/crunchbase.com\/organization\/walmart\" target=\"_blank\">Full profile for Walmart<\/a><\/li>\n<\/ul>\n<\/div>\n<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/aside>\n<p>Walmart and Amazon are also suitable candidates, given the fierce competition in online grocery and delivery, which <a target=\"_blank\" href=\"http:\/\/www.cnbc.com\/2017\/03\/24\/wal-mart-best-positioned-in-online-grocery-battle-against-amazon.html\">Walmart appears to be winning<\/a>. But they\u2019re retailers at heart,\u00a0and may want to keep their platforms open to selling a range of meal kit, or boxed\u00a0meal\u00a0products.<\/p>\n<p>Then there\u2019s Unilever, flying high from a seemingly successful acquisition of Dollar Shave Club for $1 billion in 2016. Unilever paid <a target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2016-07-20\/why-unilever-really-bought-dollar-shave-club\">five\u00a0times the amount of revenue Dollar Shave Club was bringing in<\/a>, emphasizing the fact that the company values at a high level both a brand\u2019s relationship to its customers and the subscription commerce model.<\/p>\n<p>A\u00a0massive acquisition is possible, but an IPO rumor might fire up some fear of missing out among potential buyers, and hasten this kind of deal.<\/p>\n<p>The price tag, however, for Blue Apron, has to be pretty high.<\/p>\n<h2>Blue Apron has no imminent plans to IPO<\/h2>\n<p>There\u2019s a possibility that this is the earliest stage of exploration and that this IPO is potentially years away.<\/p>\n<p>For one, sources tell TechCrunch that there is no movement on either the IPO front or the M&#038;A front for Blue Apron. Secondly, Blue Apron still has to prove it can scale sustainably and find its way to healthy margins.<\/p>\n<p>E-commerce,\u00a0at the moment,\u00a0represents a small but growing portion of overall grocery sales. Meal kit companies, and there are many, are planning\u00a0to rise on those tides for some time. Alongside Blue Apron, competitors include Plated, Hello Fresh, Sun Basket, Purple Carrot, Home Chef, Green Chef, FreshDirect\u2019s Food Kick service and scores of\u00a0others, including lots of regional and specialty players.<\/p>\n<p>Why give away your playbook to competitors, and the public, when you\u2019re one of the leading brands in the U.S. market?<\/p>\n<p>That\u2019s what it would take to go public. And it\u2019s one reason we don\u2019t think Blue Apron is there quite yet.<\/p>\n<p><em>Additional reporting by Lora Kolodny<\/em><\/p>\n<p><small>Featured Image: Bryce Durbin<\/small> <\/p>\n","protected":false},"excerpt":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" width=\"680\" height=\"383\" src=\"https:\/\/tctechcrunch2011.files.wordpress.com\/2016\/09\/farm-egg.png?w=680\" class=\"attachment-large size-large wp-post-image\" alt=\"\" srcset=\"https:\/\/tctechcrunch2011.files.wordpress.com\/2016\/09\/farm-egg.png?w=680 680w, https:\/\/tctechcrunch2011.files.wordpress.com\/2016\/09\/farm-egg.png?w=1360 1360w, https:\/\/tctechcrunch2011.files.wordpress.com\/2016\/09\/farm-egg.png?w=150 150w, https:\/\/tctechcrunch2011.files.wordpress.com\/2016\/09\/farm-egg.png?w=300 300w, https:\/\/tctechcrunch2011.files.wordpress.com\/2016\/09\/farm-egg.png?w=768 768w\" sizes=\"(max-width: 680px) 100vw, 680px\" \/>&nbsp;Meal kit makers Blue Apron may be preparing to file for a 2017 IPO, according to Reuters. The report says that the food startup has hired bankers from Goldman Sachs, Morgan Stanley and Citigroup to this end. The whole thing has stirred up quite the conversation over here at TechCrunch, and we&#8217;ve been arguing amongst ourselves about the likelihood that the Blue Apron IPO happens soon, or&hellip; <a href=\"https:\/\/techcrunch.com\/2017\/03\/30\/blue-apron-could-deliver-an-ipo-in-2017-but-should-it\/?ncid=rss\">Read More<\/a><\/p>\n<div class=\"feedflare\">\n<a href=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?a=W2mOcxCyldA:tSTIWkOI04E:2mJPEYqXBVI\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?d=2mJPEYqXBVI\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?a=W2mOcxCyldA:tSTIWkOI04E:7Q72WNTAKBA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?d=7Q72WNTAKBA\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?a=W2mOcxCyldA:tSTIWkOI04E:yIl2AUoC8zA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?d=yIl2AUoC8zA\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?a=W2mOcxCyldA:tSTIWkOI04E:-BTjWOF_DHI\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?i=W2mOcxCyldA:tSTIWkOI04E:-BTjWOF_DHI\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?a=W2mOcxCyldA:tSTIWkOI04E:D7DqB2pKExk\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?i=W2mOcxCyldA:tSTIWkOI04E:D7DqB2pKExk\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?a=W2mOcxCyldA:tSTIWkOI04E:qj6IDK7rITs\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/Techcrunch?d=qj6IDK7rITs\" border=\"0\"><\/img><\/a>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/Techcrunch\/~4\/W2mOcxCyldA\" height=\"1\" width=\"1\" alt=\"\"\/> <\/p>\n","protected":false},"author":5817,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[25],"tags":[59,66,26],"class_list":["post-337229","post","type-post","status-publish","format-standard","hentry","category-technology","tag-media","tag-techcrunch","tag-technology"],"_links":{"self":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/posts\/337229","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/users\/5817"}],"replies":[{"embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/comments?post=337229"}],"version-history":[{"count":0,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/posts\/337229\/revisions"}],"wp:attachment":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/media?parent=337229"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/categories?post=337229"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/tags?post=337229"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}