Another one bites the dust in the food delivery realm: Sprig announced Friday that their SF-based, warm meal delivery service is shutting down, capping off four years for one of the main players in meal delivery in the Bay Area. CEO Gagan Biyani posted to the company's blog and sent out an email to customers and the media making the announcement, saying, "We apologize to those of you who relied on Sprig for daily meals, and to our extended Sprig team for how this will impact them."
TechCrunch notes that the closing of Sprig means the loss of jobs for 200 people here in SF, including part-time employees. Biyani says that all employees are getting two months' severance as part of the company's shutdown plan.
In their four years, Sprig began with the model of delivering healthy meals at dinner time, beginning with just three daily options, guaranteeing delivery in most cases in under 30 minutes. They accomplished this by having drivers pick up boxed food in bulk at a central commissary kitchen on Van Ness and then having them drive around with warm food kept in warming boxes in the car, able to respond quickly to customers' orders.
They expanded operations to Chicago, but then "paused" the Chicago business in the middle of 2016, with Biyani saying at the time that the company needed to test out a new operational model and "It is incredibly difficult to make and test changes to a new model in multiple markets."
Those changes included the addition of multiple daily options to the app's menu, with some 20 daily choices as of January of this year something that Biyani had said was in response to customer feedback about wanting more variety. Also, Biyani told Fast Company that they discovered over time that "speed is not the thing that people care the most about," and that customers actually were more interested in "the quality of the food.”
Logistically that apparently did not work out, or else Sprig simply did not have the growing customer base it needed to keep attracting new investment. TechCrunch notes the odd decision the company made to open up a fast-casual cafe at their Van Ness headquarters last month, which may have been a sign of the collapse to come.
In his note today, Biyani says,
No question, I’m sad that the Sprig model did not work out but the food delivery space on the whole is growing. The demand for Sprig’s convenient, high-quality food was always incredibly high, but the complexity of owning meal production through delivery at scale was a challenge. After spending four years as a food-tech industry insider, I’m amazed at what the space has become. Food is one of the foundations of society and I believe strongly that it must become more sustainable and ethical. I’m hopeful that the food delivery companies that are succeeding will make this a priority. Please continue to help us inspire change: encourage sustainable food systems, better treatment of workers and more awareness of nutrition. These are serious issues and they cannot have enough attention.
Local competitor Munchery, meanwhile, lives on, though there were grumblings last fall that all was not totally well there either, as the company underwent a CEO shuffle. And then there are the delivery apps that simply provide delivery services to existing restaurants, including UberEats, which clearly probably took a chunk out of Sprig and Munchery's business in the last year.