Ocado invests in autonomous driving, Instacart expands e-commerce capabilities with acquisition of FoodStorm

UK –  UK-based grocery solutions and logistics business Ocado has invested £10 million ($13.6 million) in self-driving technology startup Wayve to spur the development of autonomous grocery delivery. 

Founded in 2017, Wayve’s autonomous-driving technology relies on deep learning and cameras, in contrast to the light detection and ranging — commonly known as “lidar” — systems and sensors that many self-driving companies currently employ.  

The camera-based approach is less costly, and according to Wayve, is also well suited to navigating traffic-clogged, complex city streets where so many grocery deliveries happen. 

Under terms of the financing deal, Ocado will outfit some of its vans with Wayve’s autonomous driving technology as the vehicles navigate urban delivery routes. 

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In addition, a portion of Ocado’s fleet will also get outfitted with devices that collect data that Wayve can use to improve its autonomous driving technology.  

Championing cost-effective logistics 

Ocado has been a great champion for efficient logistics handling and has automated a significant portion of the storage, picking, and packing processes in online grocery. 

“Logistics costs constitute the single-largest line item in the operating cost structure of online grocery,” the company noted earlier this year when it announced an investment of about US$13.6 million in Oxbotica, which develops autonomous driving software.  

Ocado’s twin investments therefore aim to advance the cost-saving technology while also giving it a stake in two promising firms.   

The company which licenses its technology to grocery retailers around the world also aims to leverage the expertise of these firms to eventually automate delivery for the international retailers that use its technology, like Kroger. 

Instacart expands e-commerce capabilities 

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Meanwhile, American-based e-commerce firm Instacart has bolstered its logistic capabilities with the acquisition of FoodStorm, an Australia-based catering software company. 

According to a statement from the company, the acquisition will provide Instacart with an order management system for end-to-end, order-ahead, and catering services that it will integrate into its enterprise grocery e-commerce solutions. 

Instacart’s Chief Technology Officer, Mark Schaaf, said in an interview that the addition of FoodStorm’s technology follows demands by retailers to make order management of prepared foods, custom items and catering more efficient. 

“Retailers want to bring their entire catalog of products and services on their marketplace, which more and more is prepared foods or things like sushi or birthday cakes,” he said. 

The acquisition of Foodstorm and its order management system meets this gap by helping Instacart and its partner retailers improve the purchasing and fulfillment process for online custom cakes, sandwiches, and prepared foods, Schaaf said.   

FoodStorm marks Instacart’s fourth acquisition, following the “acqui-hire” in 2015 of photo-sharing app Wedding Party and the acquisitions of white-label grocery platform Unata and mobile application index MightySignal in 2018.  

Schaaf says the decision to buy instead of build catering technology in-house was driven by the expertise of the FoodStorm team and the momentum they’ve had with retailers that also work with Instacart.   

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