HelloFresh Tells Investors It Will Surpass Blue Apron in U.S.By and
Presentation to IPO investors cites rate of sales growth
German firm is trying to distance itself from struggling rival
HelloFresh, the meal-kit startup backed by Rocket Internet SE that plans an initial public offering in Frankfurt, is telling investors that it’s set to overtake its rival Blue Apron Inc. in the U.S. in the near term.
HelloFresh generated sales of 143 million euros ($169 million) in the U.S. in the second quarter, up from 120 million euros in the first three months of the year, according to an investor presentation seen by Bloomberg News. If the Berlin-based startup can sustain that growth rate, it could top Blue Apron’s revenue in the third or fourth quarter.
“We have huge momentum in the U.S. market and are poised to overtake our biggest competitor in the near term,” HelloFresh wrote in the presentation for potential IPO investors. “We have out executed Blue Apron across all dimensions.”
Ahead of its planned IPO that aims to raise as much as 300 million euros, HelloFresh is trying to convince investors it’s better than Blue Apron, which has lost almost half its value since going public in June. The U.S. company has struggled with higher costs and a decline in customers, just as Amazon.com Inc.’s purchase of Whole Foods Market Inc. highlighted the growing competition in the food business.
Rocket Internet, which owns about 53 percent in HelloFresh, was down 0.5 percent to 21.91 euros in Frankfurt as of 12:32 p.m. local time.
HelloFresh, which is active in about nine markets, in August reported an increase in sales and customers in the second quarter while New York-based Blue Apron, which sells its boxes only in the U.S., said it’s losing clients. Blue Apron sales totaled $238.1 million in the second quarter, up 18 percent from a year earlier but down 2.7 percent from the first quarter.
In the presentation, HelloFresh compared more of its metrics with those of Blue Apron to show it’s outperforming the U.S. rival, including total meals delivered, operating profit margin and app downloads. Still, both companies are still losing money as they invest in courting new customers, according to the document.
“We generally do not comment on competitors. Our focus lies on growing the category and we believe there is space for several companies with differentiated offerings,” HelloFresh Chief Executive Officer Dominik Richter said in an e-mailed statement. “What we can confirm is that we are very happy with HelloFresh’s sustained progress in the US market.”