JoyRun has raised $8.5 million in funding for its peer-to-peer platform for on-demand deliveries.
Santa Clara, Calif.-based JoyRun is today launching its nationwide service to enable group deliveries by people in your community. The service attempts to make deliveries social, affordable, and rewarding and is initially available on college campuses.
The company raised $8.5 million in a round led by Floodgate, after previously raising $1.3 million in seed funding, led by Norwest Venture Partners.
Both rounds received participation from Visionnaire Ventures, Morado Ventures, CrunchFund, Triplepoint Capital, and a series of high-profile angel investors.
High costs, slow delivery times, and inconsistent service plague the $210 billion delivery market today. Demand for delivery is at an all-time high, but today’s expensive and inefficient solutions only cater to the top 1 percent of the market.
JoyRun turns the delivery model on its head and eliminates the cost of maintaining a fleet of delivery drivers and the associated logistics. Instead, it connects people in a given geographical region, currently those on or near college campuses, through a social feed that matches buyers with runners planning to make runs to local eateries, coffee shops, hardware stores, and more in the area.
Buyers can easily view, pay, and track their order, and can chat with others about potential JoyRuns. With this pooled approach to delivery, JoyRun has been shown to cut down on both costs and delivery time, while increasing the order size for local businesses. Over the past year, JoyRun has successfully proven its peer-to- peer platform on 50 college campuses across the U.S., from the University of California at Davis to the University of Alabama.
“Today’s delivery services are the black car version of Uber that serve just the technology hubs of San Francisco and New York. The world needs something that is not only convenient but cost-effective,” said Manish Rathi, JoyRun cofounder and CEO, in a statement. “With JoyRun, we’re building an entirely new category for the 99 percent by connecting and empowering local communities to foster their own UberPool-like service.”
One of the features that distinguishes JoyRun is its social feed, where users can browse food runs that are upcoming or now underway, request and order goods or food from any local store or restaurant, find JoyRunners nearby, and chat about food, restaurants, or even what they’re saving for with their JoyRunner fees. This social side of JoyRun has fostered a community-driven mentality to deliveries, as demonstrated by the 20 percent of buyers who also conduct runs.
The aim is to create spontaneous connections by bringing together people through a truly social, local, and mobile movement.
“JoyRun’s P2P group delivery is a game changer. It’s the only business we’ve seen that is able to scalably transform the delivery model and make the economics work. When we looked at how JoyRun was performing on college campuses, we knew Floodgate had to invest in what we see as a new category, which will transform the delivery market,” said Ann Miura-Ko, a partner at Floodgate, in a statement.
JoyRun’s technology increases the available market by waking up latent demand and supply. With JoyRun, for example, if one person volunteers to get lunch, others in their community could receive an alert and opt in to place an order and have that person pick up lunch for them, too.
“Food delivery has seen only minor incremental changes to the challenging operational issues, and no previous startup had really changed the unit economics in a sustainable way,” said Josh Goldman, general partner at Norwest Venture Partners, in a statement. “JoyRun’s social commerce approach activates local communities and makes the experience much more rewarding for consumers.”
JoyRun also seeks to make group deliveries rewarding by offering an approachable, convenient experience for students looking to set personal financial goals or raise money for initiatives. Some students have made up to $1,500 a month through JoyRun for everything from financing spring break vacations to supporting charities and Greek fundraisers.
“When I discovered JoyRun, it was the answer to all my problems,” said Sheridan, a sophomore JoyRunner at the University of Alabama, who is saving money to adopt a shelter dog, in a statement. “It’s an easy way to make money without having to maintain the hours of a regular job. This allows me to stay focused on getting my degree.”
Small businesses have also seen how powerful the platform is and how they can benefit from JoyRun. Lazi Cow, a coffee and dessert shop in Davis, California, now sees over 80 percent of its deliveries happening on JoyRun.
“JoyRun has been a game changer in proving our business,” said Jimmy Phu of Lazi Cow. “Through JoyRun delivery sales alone we’ve been able to pay off our monthly rent. It’s brought in an entirely new revenue stream for us.”
JoyRun started in 2015 and is now growing 50 percent month over month. JoyRun plans to launch later this year in select cities to be available to offices and neighborhoods around the country.