The fast delivery service is considering withdrawing from France.
(Photo: Getty Images; Per-Anders Pettersson)
Berlin Just one year after taking over the French competitor Cajoo, the Berlin fast delivery service Flink is planning to withdraw from the French market. This emerges from internal documents that are exclusively available to the Handelsblatt. Accordingly, new requirements in France call the business model into question.
Corresponding talks would be held with the works council, among others, a Flink spokesman confirmed on Thursday. A final decision has not yet been made. It is also unclear whether the French business will be sold or closed.
According to company circles, Flink put a little less than 100 million euros on the table for Cajoo in May 2022. French retail giant Carrefour also came on board with the deal. According to the spokesman, a few hundred employees are still working for Flink in France, where the fast delivery service operates in Paris, Marseille, Lyon, Toulouse and Bordeaux, among other places.
Flink has already laid off thousands of employees
It wouldn’t be the first time that Flink has withdrawn from a market. The company has already had to file for bankruptcy for its Austrian subsidiary. Should France be left, Flink would only be active in Germany and the Netherlands. In addition, there would probably be further layoffs.
The start-up has already laid off 8,000 employees over the past few months, mainly drivers. It was only announced on Wednesday that there would be another 100 jobs in administration. 500 people work there now.
>> Read about this: Flink is only valued at one billion euros – new layoffs
Flink has to cut costs massively in order to stay in business. The company announced just this week that it had been able to collect a further 150 million euros from existing investors. The corresponding contracts have been signed, a spokesman told the Handelsblatt on Wednesday. Discussions are currently being held with potential new financiers who could increase this capital injection.
In addition to the fierce competition from the merged competitors Getir and Gorillas, Flink is also affected by the increased food prices. In addition, there are high logistics and personnel costs, which Flink has been working on reducing for months. So far, the express delivery service has been unprofitable.
Start-up is only valued at one billion euros
As part of the new round of financing, Flink had to accept a significant devaluation of its goodwill to just one billion euros. The last time Flink collected money was in December 2021 and at the time, at the height of the corona boom, it was valued at three billion dollars.
Flink’s investors include Rewe and Doordash, as well as venture capitalists Target Global and Cherry Ventures, as well as Abu Dhabi-based sovereign wealth fund Mubadala, which also has a stake in its direct competitor Getir from Turkey.
>>Read also here: German unicorns become the founding forge
In view of the turnaround in interest rates, the ongoing weakness in the economy and the still idle market for IPOs, it is particularly difficult for start-ups with larger cash requirements to score points with investors. In order to examine all options, Flink is said to have negotiated a takeover with its competitor Getir from Turkey. The Flink spokesman said that these talks have now been discontinued without result.
However, according to financial sources, Mubadala remains interested in a merger of Getir/Gorillas with Flink, which is why industry experts expect that the topic could come up again at a later date.
Getir is familiar with mergers: In December, the start-up from Istanbul took over Berlin competitor Gorillas in a rescue operation. According to financial circles, the value of the merged company was halved to seven billion dollars.
More: Price war between retailers and manufacturers: Who benefits from the gaps in the shelves in the supermarket