Delivery company Gopuff is said to be looking to secure as much as a $300 million line of credit to be used as a cash safety net while it deals with slowing growth, declining tech firm valuations and a faltering economy.
That’s according to a Tuesday (Aug. 30) report from The Wall Street Journal, which cited sources familiar with the company’s plans, who said Gopuff was nearing an agreement with bankers to set up a revolving line of credit that would let the company quickly borrow money as needed — up to a certain amount.
A spokesperson for Gopuff told PYMNTS via email that they could not comment on the report.
Gopuff had planned to go public this year but postponed that move amid a decline in tech stocks. Last year, the company raised more than $2 billion — more than tripling its value — but has faced tougher times this year.
The WSJ report noted that Gopuff investor Fidelity Investments had slashed the value of its stake by nearly 50% as of June.
PYMNTS reported in July that the company planned to cut a tenth of its global workforce and shut down dozens of its warehouses, affecting about 1,500 workers on both the corporate and warehouse side of the company.
That move will close 76 Gopuff warehouses, helping the company consolidate its footprint. Gopuff conducted two other rounds of layoffs this year, including one in March involving roughly 450 people, or 3% of its 15,000-person workforce.
According to the Journal, sources familiar with Gopuff’s financials said the company had about $1.5 billion in cash after exhausting about $400 million in the first three months of 2022, noting that Gopuff’s plan to establish a new line of credit demonstrates that it is trying to bolster its finances as it tried to expand the business ahead of a possible economic downturn.