Sprig
The business, the turning points, and the decisions behind them.
01 / WHAT IT BUILT
What the company did
Sprig was a San Francisco delivery-only restaurant startup founded in 2013 by CEO Gagan Biyani and co-founder Morgan Springer. Working with a team of chefs, it sourced, cooked, and delivered a rotating menu of healthy meals within 15 minutes. The company raised $56.7 million, including a $45 million Series B led by Social Capital in 2015, and was valued as high as $169 million. It shut down in May 2017.
02 / Sprig FAILURE REASONS
Failure reasons
Sprig was killed by the brutal unit economics of vertically integrated food delivery. Doing everything - sourcing ingredients, cooking food, and delivering it - meant taking on the entire food system, and delivery and food preparation are both low-margin businesses that are tricky to get right. Customers would not pay the premiums needed to make the math work - co-founder Morgan Springer said people do not want to pay hefty margins on food. The company was burning about $850,000 a month, had laid off staff and paused its Chicago operations in mid-2016, and could not find a buyer. It closed within a week of rival Maple, which shut down the same month, as the whole prepared-meal delivery wave collapsed.
03 / EVENT HISTORY
Events in the structured record
- Company founded
Sprig was founded in San Francisco as a delivery-only restaurant that sourced, cooked, and delivered healthy meals within 15 minutes.
- $45M Series B
The company raised a $45 million Series B led by Social Capital, with CAA Ventures, IDG Ventures, Greylock Partners, and others participating, bringing total funding to $56.7 million at a valuation as high as $169 million.
- Chicago pullback
Struggling in Chicago, Sprig laid off seven people and paused operations there in July 2016, experimenting with walk-in service at its Van Ness Avenue kitchen and delivery via Caviar in San Francisco.
- Shutdown
Sprig shut down on May 26, 2017, affecting around 200 people including part-time employees; CEO Gagan Biyani's farewell email noted the challenges of scaling meal production and delivery. Bloomberg had reported the company was burning about $850,000 a month and seeking a buyer.
04 / CONTEMPORARY REBUILD ASSESSMENT
Difficulty of rebuilding this project today
Material for this section is being gathered and checked. It will appear here once ready.
Overall assessment: Not completed
05 / CAUSAL CHAIN
How the factors connect
- 01
On May 26, 2017, Sprig shut down its app and operations, affecting around 200 people including part-time employees; severance packages were provided.
- 02
Bloomberg reported the company was burning about $850,000 per month and seeking a buyer before closing; no buyer was found.
- 03
Sprig had raised $56.7 million in total; no audited annual net loss, debt total, or creditor claims were publicly disclosed.