The FGB Digest brings you the latest news on the world’s fastest growing direct-to-consumer and challenger brands. In today’s edition: Innovation Department raises first outside capital; Just Eat Takeaway acquires Grubhub in US; Wirecard and Stocard to collaborate.

Innovation Department raises first outside capital

Innovation Department, a startup building a portfolio of direct-to-consumer brands, is announcing that it has raised its first outside capital in a USD$3.7m funding round.

It has only launched one of those brands so far — WellPath, which offers customised nutritional supplements. But the next, a pet wellness brand called Finn, is scheduled to launch next month.

Initially, co-founder and CEO Alex Song said WellPath took a more general “studio” approach to incubating startups. The problem, he said, was that the studio had “no real core competency,” while it also “didn’t have enough scale to really spread things around.”

At the same time, Song felt they’d had enough success and built enough tools on the direct-to-consumer side that they could achieve “repeatable success” using “the same methodologies, over and over again.”

To do that, WellPath, Finn and future brands will take advantage of products and teams developed within Innovation Department, including DojoMojo, a software platform that allows brands to “barter” audiences from one another — a much more affordable alternative than continually spending on digital advertising to acquire new customers.

Just Eat Takeaway acquires Grubhub in US

Just Eat Takeaway — the European company that only just got its own USD$7.8bn merger approved by regulators in April of this year — officially announced that it has reached an agreement to acquire Grubhub in the US in an all-share deal for an enterprise value of USD$7.3bn. 

The acquisition is not just a big piece of M&A in the food delivery space. It also represents a major competitive swipe, since Uber Eats had also been trying to acquire the US company. The Just Eat Takeaway said the combined operation — which processed 593 million orders in 2019 — will have over 70 million combined active customers globally.

This is an all-share deal, where Grubhub shareholders will get 0.6710 Just Eat Takeaway.com ordinary shares in exchange for each Grubhub share, representing an implied value of USD$75.15 for each Grubhub share. 

The deal caps off a tumultuous period for Grubhub, which as Maloney noted was also created through a combination with another rival, Seamless. The company has been in play for months and had been in acquisition talks with Uber’s Eats division.

Wirecard and Stocard to collaborate

Wirecard, a digital financial technology business, is collaborating with mobile wallet Stocard, one of the largest B2C European fintechs, to launch a new mobile payment feature in the Stocard app.The announcement comes as Stocard reaches 50 million users worldwide. 

UK-based Stocard users can pay with their app via a virtual Wirecard-issued Mastercard card, an option that will be rolled out across Europe later this year. Stocard users will benefit from Wirecard’s bespoke banking-as-a-service solution to launch this new functionality. Wirecard is also providing the acquiring service behind the wallet, allowing users to load funds quickly and effortlessly by adding their bank cards to the app.

Through the new mobile wallet solution, Stocard users can now make contactless payments in-store and online. Wirecard’s research found that contactless payments are booming across Europe. More than half of British, French and German respondents (57%) report using contactless payment methods more frequently today than before the spread of COVID-19. Over three-quarters (78%) plan to continue making contactless payments even after the crisis.

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