Wine & Spirits Daily:
Alcohol delivery service Drizly has secured another $13 million in financing from a group of investors including private equity First Beverage Group. Polaris Partners was the primary investor and Suffolk Equity Partners, who participated in the $4.8 million seed financing in 2014, also joined this round. With this most recent investment, Drizly’s backing is up to nearly $18 million since its founding in 2013.
Drizly will use the funding to continue expansion across the US — 30 states by the end of 2016 — and “invest heavily” in product development, sales and marketing, operations and global distribution. Drizly co-founder Nick Rellas also tells WSD that there is an “incredible opportunity” in control states and they are in active conversations with many of them.
You’ll recall, this news follows the announcement last week that WSWA made its first-ever monetary investment in an alcohol beverage company, gaining a seat on the board in the process [see WSD 05-13-2015 ].
Nick tells WSD: “There’s plenty of people in the industry that are questioning whether or not we’ll continue to exist and whether the model is sustainable,” but “I give WSWA a lot of credit for saying ‘Hey, this is the future.’”
WSWA chief Craig Wolf tells WSD that the trade group spent more than a year looking into the concept of alcohol delivery before deciding to back Drizly. Drizly’s service “solves a lot of problems,” he says. For one, it addresses the growing demand for convenience and efficiency. “With the busy schedules that a lot of people have, the type of ordering that Drizly facilitates makes it very, very easy to get what you want and what you need in a short period of time.”
Naturally, WSWA also likes that Drizly ensures product integrity by being three-tier compliant and employing a strict age verification process. Moreover, Drizly educates consumers on the ever-increasing number of products available to them. “A lot of people don’t understand how much variety and how much choice they have… [Drizly] allows the consumer to go online and see exactly how much is available to them locally,” he says. “They can compare prices and learn a lot about the products by doing this. Then they can order and get it delivered in a very quick, efficient manner.”
As Drizly continues to enter new markets, WSWA and its member will help get the service up and running smoothly. Southern Wine & Spirits chief Wayne Chaplin tells WSD, “Drizly will be able to leverage the WSWA wholesaler members’ market-specific regulatory knowledge and their know-how to expand retailer relationships in existing and future Drizly markets.”
“Coordination of these efforts through WSWA brings the full national strength of the middle tier to bear for the alliance. It will truly be a win-win-win effort for Drizly, individual wholesalers like Southern, and WSWA,” Wayne says.