Target is acquiring technology from the same-day delivery startup Deliv, which is shutting down.
The Minneapolis-based retailer also will bring Deliv CEO Daphne Carmeli and a small number of engineers on board as part of the deal, which is expected to close later this month. Terms were not disclosed, but the acquisition is not considered to be material to Target.
Deliv, which is based in Menlo Park, Calif., handled last-mile same-day delivery for major retailers including Best Buy, Macy's and Walgreens. It operated in 35 markets using a network of drivers who worked as independent contractors.
"We are working with our retail partners to transition delivery services to other providers during the next 90 days," Deliv said in a statement.
During the pandemic, delivery services from operators such as Instacart, Amazon Prime and Target's Shipt have been in high demand. It was not immediately clear why Deliv was winding down.
Deliv is not Best Buy's only delivery partner, and the Richfield-based retailer does not expect any major disruptions to its same-day delivery options, a spokesperson said.
Target is not buying the whole company, but the core technology Deliv used to help batch orders together for more efficient delivery. The retailer will test it and see how it can bolster its delivery operations.
This is the third delivery-related acquisition for Target, the most significant of which was its $550 million purchase of Shipt in 2017. Shipt not only powers same-day delivery for Target, but also for other retailers such as CVS and Petco. That same year, Target also purchased Grand Junction, a 13-employee firm in San Francisco.
"This technology from Deliv is just one more example of how Target is investing for the future of local delivery," Arthur Valdez, Target's chief supply chain and logistics officer, said in a statement.
Deliv was founded in 2012. It had raised more than $80 million, according to Crunchbase, and was backed by companies such as Google, United Parcel Service and major mall operators.