Uber shuts down Drizly, the alcohol delivery service it bought for $1.1 billion

Uber has decided to shut down Drizly, the alcohol delivery service it bought three years ago for $1.1 billion. Axios was the first to report the news.

Drizly was a pioneer in the BevAlc delivery category and provided backend tech that allowed local liquor stores to provide their own deliveries. However, it was always an odd match for Uber, as it didn’t hire or contract its own delivery workers. Instead, it relied on local liquor stores to provide their own deliveries.

The bigger issue, however, might have been cybersecurity. Drizly confirmed a hack in 2020 that exposed information on around 2.5 million customers.

“After three years of Drizly operating independently within the Uber family, we’ve decided to close the business and focus on our core Uber Eats strategy of helping consumers get almost anything — from food to groceries to alcohol — all on a single app,” said Pierre-Dimitri Gore-Coty, Uber’s SVP of delivery.

Uber’s decision to shutter Drizly is not surprising given the company’s recent focus on profitability. The move is expected to help Uber streamline its operations and focus on its core business.

Drizly’s closure will have a significant impact on the BevAlc delivery category, which has seen a surge in demand during the pandemic. The company was a pioneer in the space and helped to establish the market for alcohol delivery services. However, with the rise of other players in the market such as Instacart and DoorDash, Drizly’s market share has been declining. The closure of Drizly is likely to lead to further consolidation in the BevAlc delivery category.