Blue Apron, the meal-kit company backed by the likes of Bessemer Ventures and First Round Capital in private markets, is trying just about everything to raise cash.
During its fourth-quarter earnings report Wednesday, the boxed-dinner maker said it was considering a merger, a potential sale of all or a part of its assets, a capital raise through public or private markets, or some combination of the above.
Blue Apron is an interesting thesis on paper: Meal planning can be arduous and grocery trips frustratingly multi-legged. At a time when you can get just about anything with a click on Amazon, why not build a company that plans the meal for you and cuts out Wegmans and Walmart?
But its execution is a lot less clean-cut. Once valued at $2 billion, Blue Apron now sits around $58 million in private markets.
Turns out, the model is easily replicated, marketing spend is high, and the act of cooking itself is still time-consuming. Meanwhile, consumers continue to dine out or order delivery. Other meal kit makers such as Plated (acquired by Albertsons Companies) and Chef’d have shuttered their doors.
Blue Apron is still a sizable business, for sure: It reported $454.9 million in revenue for 2019 and losses of $61.1 million. But compare that to a peak of $881.2 million in revenue in 2017, and the difficulties of maintaining growth in the direct-to-consumer market become stark.
“We continue to believe that we have the right strategy to drive our resumption of growth as we work to launch additional new capabilities and test new product offerings,” CEO Linda Findley Kozlowski said, according to the press release.
Meal kits aren’t completely dead: HelloFresh, which trades in Frankfurt, is currently valued around $4.1 billion and has traded healthily since its IPO.
But meal kits have been less of a revolution than some imagined, with the CEO of Berlin-based HelloFresh telling the Wall Street Journal in December that the overall market was growing “not as much as we thought.”
Done Dell Deal: Dell Technologies is selling one of its cybersecurity units, RSA, for $2.08 billion to a consortium of investors including Symphony Technology Group, the Ontario Teachers’ Pension Plan Board, and AlpInvest partners. Dell acquired RSA in 2015, as part of its larger deal to buy EMC for $67 billion that year.
Lucinda Shen
lucinda@fortune.com
Housekeeping: It’s been a pleasure working on Term Sheet for the past two days! Let me know if any of your supply chains have been affected by coronvirus in China. Separately, Polina returns tomorrow. Please send new deals to polina.marinova@fortune.com.
