Gousto, the recipe-box subscription service, has cut its valuation in its latest £50m funding round to help handle a “volatile period”.
First reported by Sky News, the food tech unicorn, which has been backed by celebrity fitness coach Joe Wicks and Japanese investment giant SoftBank, will reduce its $1.7bn valuation as part of its new investment round.
The subscription service, which sends customers healthy recipe boxes for home cooking, landed its big-money valuation in November 2020 after a Series F funding round.
SoftBank contributed to a further investment in January of last year when the company raised $150m (£110m).
The January round came in part from multinational conglomerate SoftBank, which later provided an additional investment into Gousto in February 2022.
The extent to which the Gousto valuation will be cut is not yet known, however, a formal update to shareholders is expected. A source confirmed the latest funding round to UKTN.
Gousto will become one of many companies to accept a lower valuation when raising fresh capital, in a process known as a downround.
A source close to the situation told Sky News: “The raise will provide the cash headroom required as the company enters a volatile period.”
Founded in 2012 by Timo Boldt and James Carter, Gousto, like many other startups, achieved a period of increased demand for its food delivery products during the lockdown restrictions in 2020 and 2021. That boost helped propelled the company to major funding rounds over the last three years.
The company was previously preparing for a public listing, hiring bankers at Rothschild, though it is uncertain if those plans have been put on hold.