Blue Apron is preparing to go public this week, but recent signs show things may not be all rosy at the meal kit delivery startup.
The New York-based company, which delivers pre-portioned ingredients and recipes that let users make gourmet, home-cooked meals, on Wednesday morning slashed the proposed value of its upcoming IPO. Instead of pricing its 30 million shares between $15 and $17, the company now is targeting a range of $10 to $11, according to paperwork filed with the Securities and Exchange Commission. That means at the low end of the range, Blue Apron would raise $300 million — 38 percent less than previously planned.
Though the startup has captured the hearts and wallets of millennials who want fancy meals but lack the time to shop and plan, it hasn’t all been smooth sailing for Blue Apron. For one thing, the company needs its users to eat more, MarketWatch reported. Blue Apron spends an average of $94 to acquire each customer, and the company is spending more on marketing in an effort to bring in and hold onto more users.
For the first three months of this year, Blue Apron reported a net loss of more than $52 million, according to the company’s SEC filing.
And the company faced scrutiny last year after a report of violence and intense working conditions at its Richmond warehouse.
Blue Apron is expected to price its IPO Wednesday and start trading on the public market Thursday. The company plans to list on the NYSE under the symbol APRN.
Photo: A photo shows a box and ingredients from Blue Apron. (Courtesy of Blue Apron)
Tags: Blue Apron, Initial public offering, IPO