On Wednesday, grocery delivery startup Dumpling announced that it raised $6.5 million in a Series A funding round. Forerunner Ventures led the round, which brings the company’s total funding raised to $10 million.
COVID-19 has changed the way we shop for our groceries. Getting your groceries delivered has gone from a luxury to a necessity for many, and as a result grocery delivery services have seen a huge bump in business. For example, Instacart — one of the most popular grocery delivery startups — is now valued at $13.7 billion after raising $225 million in new funding. Dumpling, while much smaller than Instacart, has seen a 20x increase in order volume since March.
But there’s a key difference between how Instacart and Dumpling operate. While Instacart uses gig workers to shop for and deliver groceries, Dumpling has created the digital tools for people to launch and run their own independent grocery shopping businesses. As a result, Dumpling shoppers have more autonomy, they set their own prices and schedules, and they keep 100 percent of the tips. Dumpling claims that shoppers earn three times more than Instacart shoppers do on average.
Dumpling launched to address worker complaints that arose due to the nature of the gig economy. The company found that gig workers often felt undervalued and underpaid by on-demand grocery delivery startups.
“Dumpling is a dramatic evolution in the face of the severely broken gig economy. We empower disenfranchised gig workers to be truly independent business owners and enable them to build financial stability and wealth for the long term,” Joel Shapiro, Dumpling co-CEO and cofounder said in a statement. “Now, with the stark reality that millions of jobs lost due to COVID-19 may not return, Americans more than ever need a more viable, sound and flexible way to earn a living.”
This is important because the dissatisfaction for the gig economy has been felt around the world. Independent contractors and gig workers are pushing to be recategorized as employees, and the Seattle City Council recently passed a bill to provide premium pay to gig workers delivering food during the COVID-19 pandemic. As more legislation is passed to change the gig economy, Dumpling could potentially serve as a model for how to address the concerns of gig workers while still providing the same services for customers.
The new funding will help Dumpling expand its reach. The company has partnered with over 2,000 grocery delivery businesses across 50 states.
