Bharat Pulgam, a 2017 Wayzata High School graduate, is finding some financial footing for his delivery app Pikup.
The fast-growing Minneapolis-based startup recently closed on $1.8 million in funding. The money comes from funds across the country, including Unusual Ventures, Starting Line and Matchstick Ventures.
Founded in 2018 by Pulgam, along with fellow Wayzata High graduate Josh Chang and Mounds View High graduate Sam Lerdahl, Pikup is set out to make delivery an affordable and convenient way for customers to get what they need.
“The current delivery model is broken. Customers pay more than they need to, drivers are denied basic workplace protections and merchants don’t make any money on delivery,” Lerdahl said. “With delivery companies posting record losses, the delivery space is ripe for disruption, and we are in a great position to do just that.”
During the startup’s first year, Pikup was selected for the Target + Techstars retail accelerator program, a four-month incubator designed to teach early-stage startups how to launch products to market and start the fundraising process. The team of University of Minnesota students tested their app, which was then called Runerra, with students at the university and partnered with retailers like Target, Caribou Coffee and Qdoba.
The early success prompted the students to drop out of school to focus on the app full time and work to expand the service to campuses at the University of Wisconsin-Madison and the University of Nebraska-Lincoln.
In 2020, the team began pivoting away from college campuses during the onset of the COVID-19 pandemic. With businesses and schools closed and people told to limit their trips outside their homes, Pulgam reached out to his neighbors in Maple Grove through the Nextdoor social networking app to see if anyone was interested in downloading Pikup so that people could help each other get food and items from businesses that were still open.
The Pikup team then began finding other neighborhoods where the app could be used. Pikup users were notified if someone in their neighborhood was out or planning a trip to a certain store so that others were able to submit requests for items.
Pikup now offers weekly deliveries across the Twin Cities from local merchants like Lunds & Byerlys, Cub Foods and national brands like Target, Costco, Trader Joe’s and more.
The shift to weekly neighborhood deliveries has helped Pikup stand apart from similar services, Pulgam said.
Every Sunday, Pikup customers get a delivery schedule for the week. Neighbors can order throughout the week and invite others to save more together. By grouping orders together onto a single delivery, Pikup decreases the cost of each delivery, passing those cost savings on to their customers and retail partners.
“Bundling makes it cheaper, more efficient and more eco friendly since there are less cars on the road,” Pulgam said. “It’s just beneficial from all perspectives.”
Scott Holloway of Starting Line Ventures said his fund was attracted to the community-based business model of Pikup.
“Pikup represents the logical next evolution in on-demand commerce,” Holloway said. “By aggregating demand in pre-scheduled drop windows, costs come way down and efficiencies go way up which enables families to be able to truly afford multiple deliveries per week.”
As CEO of Pikup, Pulgam said the $1.8 million funding support comes at just the right time as the startup continues to expand delivery options and merchant partners.
“Our customers expect Pikup to be the one-stop shop for everything they need. This funding allows us to expand the diversity of the merchants we offer to our neighborhoods each week and the number of markets we can serve,” Pulgam said. “Customers can now get their groceries for the week, liquor for the weekend, dinner and more all through one place.”
Pikup plans to expand in 2022 to two additional markets in the Midwest while also bringing weekly deliveries to the rest of the Twin Cities market.
To learn more about Pikup, visit trypikup.com.