Honestbee faces financial difficulties, is allegedly in talks with Grab & Go-Jek to discuss acquisition
They bee in trouble.
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There’s been speculation that Honestbee, a Singapore-based grocery and food delivery platform, has been going through some financial issues recently.
Ceased partnerships, late payments & lay-offs
In January this year, Honestbee temporarily paused its partnership with FairPrice in Singapore.
Taiwan vendors had also complained about Honestbee failing to settle payments on time, according to a Yahoo news report.
Honestbee claimed this was a case of them streamlining payment operations, which affected payment time.
A key development that led to even more scrutiny on Honestbee’s financial situation was the temporary ceasing of operations in the Philippines.
Which was quite a shock, considering how well the market appeared to be growing there.
Subsequently, staff layoffs were also placed under the spotlight, with around 6 percent of their global workforce reportedly being laid off.
A possible reason for the troubles in the region was speculated to have something to do with the company’s financial situation.
In fact, a source told TechCrunch that Singapore-based staff had been informed of salaries not being paid out on time.
TechCrunch ran a report detailing the extent of their financial worries, and how more layoffs might be coming.
Possibly being drained of funding
According to TechCrunch, the crux of Honestbee’s issues stemmed from their rather-impressive funding being drained.
“Internal numbers for Honestbee in December 2018, seen by TechCrunch, show that it lost nearly $6.5 million, with around $2.5 million in net revenue for the month.”
The opening of their highly popular, but expensive physical space, Habitat, probably added to the financial woes of the company.
In fact, TechCrunch also reported that a few suppliers have been changed due to issues such as late payment.
Which leads to the question, what next?
Apparently started talks with Grab & Go-Jek
Two industry sources with knowledge on the matter told TechCrunch that Honestbee has apparently already started talks with two viable candidates, Grab and Go-Jek, to discuss the possibility of an acquisition.
Grab has been on a fund-raising spree lately, with a recent S$4.5 billion round apparently about to be followed by a further S$2 billion in funding this year.
Grab has also been investing heavily in making an all-encompassing “super app”.
Honestbee has not yet commented on whether there are plans to sell the business.
Image from Honestbee’s Facebook