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SpoonRocket’s U.S. meal-delivery service shut down on March 15, 2016, after the company could not secure enough funding to continue. The closure followed an initial denial by co-founder Anson Tsui: VentureBeat updated its report the next morning after SpoonRocket confirmed it was shutting down. The company’s technology was later acquired by Brazil-based iFood, which relaunched the SpoonRocket name in Brazil under a different model.
What happened to SpoonRocket?
SpoonRocket told customers on March 15, 2016, that it had closed over the weekend and ceased operations in the United States. Its announcement attributed the decision to a market downturn and reduced venture-capital interest in on-demand companies. The company’s statement, reproduced by Ars Technica, said it had been forced to shut down before it could grow into a viable business.
News of the closure was not consistent at first. On March 14, VentureBeat reported the shutdown, but co-founder Anson Tsui denied it, saying the company was “just resetting.” VentureBeat changed its headline and account on March 15 after SpoonRocket confirmed the closure. The initial denial was not the final outcome.
Why did SpoonRocket shut down?
The immediate problem was financing: SpoonRocket could not raise enough capital to keep operating. The company cited a downturn in the market and less venture interest in on-demand businesses. Co-founder Steven Hsiao also told TechCrunch that a potential acquisition had appeared close before the other party withdrew at the last minute.
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SpoonRocket had reported positive contribution margin on its meals, but that did not mean the whole company was profitable. In TechCrunch’s account, meal revenue exceeded the direct costs of cooking, packaging and delivery; broader operating expenses and the need for continued funding remained. Low prices and a rapid-delivery target could not by themselves pay for the entire business.
How SpoonRocket’s U.S. model worked
Unlike a marketplace that mainly connects customers with independent restaurants, SpoonRocket prepared a limited menu of meals in batches and handled delivery through its own logistics. TechCrunch described delivery cars fitted with warming cases. The company aimed to sell meals for less than $10 and deliver them in under 10 minutes; those were operating ambitions, not proof that every order met either target. Y Combinator’s profile described the promise as delivery in 15 minutes or less, a different figure from TechCrunch’s report of the sub-10-minute ambition.
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This model gave SpoonRocket more control over menu preparation and delivery, but also meant it had to support those operations itself. Its experience illustrates the difference between making money on an individual meal and funding the staff, systems and other costs required to run a delivery company.
What SpoonRocket’s reported finances showed
Contemporaneous reporting provides some context, but these figures were company-reported rather than audited results:
- Funding: TechCrunch and Ars Technica reported that SpoonRocket had raised $13.5 million through a 2013 seed round and a 2014 Series A.
- Revenue: The founders said in an investor letter that the company had reached an $8 million revenue run rate at the end of 2015, as reported by TechCrunch. A run rate is an annualized measure based on a recent period, not the same as audited annual revenue.
- Price and speed aims: TechCrunch reported a target of meals below $10 delivered in under 10 minutes. Y Combinator’s profile separately described a promise of delivery in 15 minutes or less.
These reported figures show activity and scale, but they do not establish that SpoonRocket had enough cash or company-wide profitability to continue.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Was SpoonRocket acquired?
After the U.S. shutdown, Brazil-based iFood acquired SpoonRocket’s technology, TechCrunch reported on March 16, 2016. The report did not disclose the financial terms. iFood later relaunched the SpoonRocket name in Brazil. In that version, restaurants prepared the food while SpoonRocket focused on menus, technology and logistics. TechCrunch reported more than 300 restaurants on board in São Paulo at the time of the September 2016 relaunch; that is a contemporaneous figure, not a current count.
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The technology acquisition and Brazilian relaunch were separate from the closure of the U.S. prepared-meal service. The 2016 reports do not establish whether a Brazilian successor service is operating today.
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SpoonRocket shutdown timeline
- 2013: SpoonRocket entered Y Combinator’s Summer 2013 batch; its profile described a delivery promise of 15 minutes or less.
- End of 2015: The founders reported an $8 million revenue run rate in an investor letter.
- March 14–15, 2016: An initial shutdown report was denied by Tsui; SpoonRocket confirmed the closure the next day.
- March 15, 2016: The company announced it had ceased U.S. operations.
- March 16, 2016: TechCrunch reported iFood’s acquisition of SpoonRocket’s technology.
- September 19, 2016: TechCrunch reported the Brazilian relaunch, with restaurants preparing meals.
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