Kağan Sümer, the entrepreneur and founder of the up-and-coming Gorillas food delivery app, is the mastermind behind one of the fastest unicorns Germany has ever seen. The excitement surrounding the app has been nothing short of impressive, and at first glance Gorillas surely looks like a success story. After a year on the market with a wide geographic spread and hundreds of employees, Gorillas seems flawless. But as the saying goes, if something seems to be too good to be true – it is usually because it is.
Gorillas is not Sümer’s first foray into the business, and tech worlds. The seasoned entrepreneur has previously tried reaching success in various sectors. From the dry-cleaning app Kuru to the furniture rental app Lyght Living, Sümer has a track record which unfortunately showcases multiple promising ventures that ended in failure. While Gorillas appears to be Sümer’s first time getting it right, investors may benefit from thinking twice before betting on this horse.
The main reason for concern is Sümer’s strategy, which includes expansion at the cost of risk management. Sümer seems to have made a habit of ignoring instead of facing and managing the multitude of surging issues within Gorillas, and instead he marches ahead with business expansion as the first priority. It is unfortunate to see that Gorillas, as promising as they seem, have plenty of issues; problems with products, employee abuse, declining customer satisfaction, infrastructure problems, and app failures, to only mention a few. One cannot help but wonder how Sümer’s strategy, focusing on aggressive expansion, may affect investors and key stakeholders when so many core issues are left unaddressed.
One-time Unicorn Bonus
Recently, Gorillas’ issues with their employee practices have reached the surface as both current and former employees have shared their experiences. One of the complaints is that when Gorillas reached its unicorn status, Sümer was supposed to reward his employees with a one-time bonus. How much and in what form, cash or stock, is unknown. Furthermore, there was no proper breakdown of which employees would receive what size bonus or when they could expect to receive it. The suspicion is that it never happened, and the lack of financial transparency is both unnerving and a reason for worry for the company’s investors.
The Environment in the Warehouse
In addition to the opaque finances, Gorillas has been subjected to increasing reports about their abusive employee practices. Ranging from dangerous work environments to intimidation from management and union busting, it is safe to say that employees are suffering at the hands of this unicorn. Multiple Twitter accounts have been set up to fight for unionization as a means to protect themselves from Gorillas practices, and a quick search on the platform unveils a multitude of tweets tagging the founder, questioning how Sümer can call his employees a family when “there’s intimidation practices in place.” This severely contradicts Gorillas initial promise that they would use funding to bolster employee development programs and secure a healthy working environment for its employees. Given the current developments, it is understandable why Gorillas employees refer to this promise as a laughable concept.
To add to the claims, sources mean that Sümer is basing his business on a culture of intimidation where employee complaints are not allowed, or simply brushed under the carpet. During a recent company meeting, Sümer explained this as not wanting to promote a “complaining culture.” From an HR perspective, what this means is to strip employees of their basic right to speak their opinion and demand basic working conditions, but more so, from a business perspective to create such a work environment may have long term implications for Gorillas continued success and even stunt their growth. With many other successful competitors in the food delivery sector, employees are likely to abandon ship rather than stay at a company that refuses to hear them, and the same goes for the highly aware and quality focused consumers of the 21st century.
Gorillas’ employees are not the only ones raising their concerns about the company, the customers may have also had enough. Another ongoing issue that has been haunting Gorillas are their “fulfilment centres;” the infrastructure enabling their promise of a 10-minute delivery window. The company requires fulfilment centres to be scattered throughout their delivery zones in order to make their timeline possible. However, with noise pollution and toxic fumes, the centres are quickly becoming the ire of many communities. The bad reputation of the fulfilment centres has spread, leading to residents opposing Gorillas setting up shop in their neighbourhoods or trying to dissolve the ones that are already there. If Gorillas cannot establish fulfilment centres, they will not be able to keep their promise of a delivery “faster than you,” making them lose their main competitive edge. This is not just a foreseeable issue that needs to be addressed, with delivery times reportedly closer to two to three times as long as promised, it is a problem that is already having a grand effect on the company and their customers. Add even fewer fulfilment centres to the mix, and customers will have no reason to stay with Gorillas. A business based on a promise that is increasingly harder to keep is likely to see its fall as fast and dramatic as its epic rise, resulting in customers returning to more reliable food delivery apps and services.
Gorillas’ epic rise is due in no small part to the type of business it is. VCs are rushing to make investments in this sector, and raising large amounts of money is easier than ever. But just as consumers expect greatness and have a wide range of choices when it comes to delivery options, VCs should also carefully consider what delivery businesses they choose to invest in.
Gorillas choose to take an ostrich approach to their issues, while failing to improve their operations and address the obstacles that may end up making the company crumble, they stick to their relentless plan to use all funding to continue expansion, including to the U.S. However, it is clear their success has come at the expense of not only it is worker, but also customer satisfaction – the two groups that can make or break a company. As it seems a unicorn, while appealing, may not be the best return on investment in the end.
Between worker disputes, customer complaints, lack of sensitivity to the communities within which they operate, and reported failures to observe proper employee regulations, the lack of addressing and solving issues while only pushing forward may make this flying unicorn end up as a sinking ship.
The question is if they will manage to turn the trend around or if the food delivery app will go down the drain just like Sümer’s other business ventures? Gorillas’ future remains to be seen.