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Uber Closing Down Drizly 3 Years After Acquisition

Uber is closing down its alcohol delivery business, Drizly.

The move comes three years after Uber bought Drizly for $1.1 billion, Axios reported Monday (Jan. 15), citing Uber’s senior vice president of delivery, Pierre-Dimitri Gore-Coty.

“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,” Gore-Coty said in a statement emailed to PYMNTS by an Uber spokesperson.

The Drizly business and brand will be shut down at the end of March, according to the Uber email. Uber will apply what it has learned from Drizly’s experience to Uber Eats’ efforts in the alcoholic beverage delivery category, which it now offers in 35 states and more than 25 countries. That business has more than doubled over the past year.

Drizly differed from other parts of Uber’s business in that it didn’t hire or contract delivery workers; it provided back-end technology to help liquor stores provide their own deliveries, according to the Axios report.

When Uber’s acquisition of Drizly was announced in February 2021, Uber CEO Dara Khosrowshahi told CNBC that the company wanted to “double-down” on alcohol delivery by buying the leader in that space.

Uber aimed to upgrade its food delivery platform, Uber Eats, by integrating Drizly’s marketplace into the Uber Eats app while also maintaining a standalone Drizly app.

At the time of the acquisition, Drizly had become the leading on-demand alcohol delivery service in the United States and had expanded its availability to 1,400 cities since its founding in 2012.

In November 2021, a month after the acquisition was completed, Drizly announced that it had partnered with 7-Eleven to deliver alcohol in 60 minutes or sooner from 1,200 of the convenience retailer’s stores.

In October 2022, the Federal Trade Commission (FTC) took action against both Drizly and its then-CEO, James Cory Rellas, for activity around a data breach that took place at the company in 2020 — before its acquisition by Uber.

The FTC alleged that Drizly and Rellas were alerted to data security problems in 2018 but failed to improve the company’s procedures before a data breach took place two years later in 2020.

Uber has been expanding its alcoholic beverage selection for years, with Uber Eats looking to drive adoption of its non-restaurant offerings and boost the unit economics with higher-ticket categories.