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After weeks of rumors, Getir has announced that it is acquiring Gorillas. This is a major consolidation deal for the instant grocery delivery space. The Financial Times first reported that Getir has closed the acquisition of its competitor. TechCrunch has confirmed the news with Getir.

“Markets go up and down, but consumers love our service and convenience is here to stay. The super fast grocery delivery industry will steadily grow for many years to come and Getir will lead this category it created 7 years ago,” Getir founder Nazim Salur said in a statement.

Getir originally launched its service in Turkey in 2015. Over the past couple of years, many people started ordering groceries online because of lockdown restrictions. Getir, Gorillas, Flink and a cohort of startups tried to popularize a new model for grocery deliveries.

Instead of reserving a delivery slot for the next day, orders are processed instantly on those apps. The user experience works more like food delivery services, such as Uber Eats, Deliveroo and Just Eat Takeaway. You open an app, pick a few items, hit the order button and track your order from your phone.

Those services raised a ton of money and grew at a rapid pace during the COVID-19 pandemic. Behind the scenes, all those instant delivery startups built networks of dark stores in dense cities so that orders can be delivered in less than an hour.

In addition to these expensive operation costs, startups in the space spent a small fortune in promo codes and reduced delivery fees. But restrictions were lifted, VC funding dried up and some cities put some restrictions on dark stores. That’s why 2022 has been a rough year for the industry, leading to a lot of layoffs, pullbacks and consolidation moves.

In May, Getir announced that it would cut 14% of its global staff — more than 4,000 were impacted by the downsizing. In addition to its home country, Getir operates in various European countries, such as the U.K., Germany, France, Italy, Spain, the Netherlands and Portugal. It operates in the U.S. as well.

Gorillas also had to conduct a round of layoffs earlier this year. It decided to focus on a handful of markets — Germany, the Netherlands, the U.K. and the U.S. The German startup acquired Frichti before it became harder to raise funding rounds.

According to the Financial Times’ Tim Bradshaw, the combined group is now valued at $10 billion. At the height of the instant grocery bubble, Getir and Gorillas reached valuations of $11.8 billion and $3 billion respectively. Gorillas investors are set to obtain 12% of Getir’s capitalization table.

As there is a lot of overlap between the two companies, there might some layoffs in some cities where both services are currently live. Reducing the number of dark stores could also help the company’s bottom line.

Instant grocery app Getir acquires its competitor Gorillas by Romain Dillet originally published on TechCrunch

When President Joe Biden signed the Inflation Reduction Act (IRA) into law on August 16, 2022, we started looking into its implications, particularly with regard to the impact on the future of the climate and the innovations that might shape that future.

As the most important piece of climate legislation in United States history, the IRA represents a fundamental regulatory inflection that may help create a different future. The purpose of this post is to share our understanding of the regulatory ramifications of this monumental bill, especially as they relate to the problems some of the most capable founders in the world are looking to tackle.

Building electrification

The IRA contains several major programs that aim to accelerate building electrification — the replacing of residential fossil fuel machines with electric equivalents. This has the benefit of eliminating combustion emissions, improving comfort, as well as improving indoor air quality, which can have dramatic positive health impacts.

There are three major programs that incentivize building electrification. The first (Sec. 50122) provides a total of $4.5 billion in funding for appliance replacements and is means tested: It provides up to 100% of project costs for those earning less than 80% of area median income (AMI) and 50% of project costs for those earning less than 150% AMI, with annual limits. Eligible appliances include heat pumps, heat pump water heaters, electric or induction stoves, electric or heat pump clothes dryers, upgraded breaker boxes, electrical wiring upgrades, home energy audits, and insulation and sealing.

The second program (Sec. 50121) is a performance-based home energy retrofit program that provides up to $4,000 per home, or $8,000 per home for low-to-moderate income households. Projects cannot claim both this program and Sec. 50122.

Both programs can be combined with the third program (Sec. 13302), which expands the Investment Tax Credit (ITC) to a 30% tax credit for eligible projects including residential solar, solar water heating, fuel cell, small wind energy, battery storage and geothermal heat pumps.

The IRA also includes significant and open-ended financing for projects that broadly reduce greenhouse gasses and accelerate deployment of renewable energy, many of which will likely apply to building electrification projects, such as the Greenhouse Gas Reduction Fund (Sec. 60103), and $40 billion in loan guarantee authority for the Department of Energy (Sec. 50141).

Interesting problems

The funding in the IRA for buildings is likely to catalyze the replacement of fossil fuel machines in buildings and accelerate the adoption of fully electric alternatives. Today, market share of these alternatives is relatively low and contractor adoption and expertise is lacking. Early examples of an increase in consumer demand for these products include Maine and New York.

While we won’t see an overnight shift across the country, these incentives will create a burgeoning market for home electrification, similar to how past laws created a market for residential solar. Problems we have identified include:

Fragmented contractor market.
There are not enough trained professionals (electricians, HVAC technicians, etc.).
Projects tend to be highly custom and time intensive to design and quote.
Difficult for businesses and consumers to navigate the changing financing/incentives landscape.
The ROI of these projects will be highly variable and vary from home to home.
Most home appliances are replaced on failure in an emergency, and most homes are not wired for 220v, so there is a pre-wiring problem to be solved.
Navigating the retrofit process is time consuming and confusing for consumers, requiring work across multiple contractors that don’t individually plan for holistic project needs (e.g., panel upgrade).

Carbon capture/methane reduction

The latest science tells us that in order to keep warming to 1.5°–2° C, we need to reduce emissions to about 45% lower than 2010 levels by 2030 and achieve net-zero by 2050. It is not realistic to expect that we can replace all of our fossil fuel machines and processes in that time frame.

The climate founders’ guide to the Inflation Reduction Act by Ram Iyer originally published on TechCrunch