Read the amazing claim the MilkRun founder made just 10 months ago

• Danny Milham claimed Milk Run will be bigger than Coles and Woolworths
• Expedited grocery delivery company suspends trading on Friday

Less than a year later, Dany Milham was lyrical about the stratospheric goals of MilkRun, the express grocery delivery company that was dominating the streets of Sydney and Melbourne at the time.

“I’m very ambitious,” he told the Australian Financial Review in Puff Piece, entering number 40 on the publication’s Young Rich List.

The serial entrepreneur then makes the implausible claim that within a decade MilkRun will be a bigger business than Coles and Woolworths, expanding to Brisbane, Adelaide and Perth, delivering everything from groceries to iPhones. I made a plan.

“We hit our targets and targets, our investors are happy and we are gaining market leadership very early on,” he said. “The opportunities are endless.”

Ten months later, his rider will lock the bike for the last time on Friday.

MilkRun announced yesterday that it will be closing and laying off all staff and passengers.

Milham sent an email to 400 employees on Tuesday, blaming deteriorating market conditions for the company’s collapse, even though the business was “performing well.”

“We set out to change the face of grocery delivery in Australia,” he told staff.

His dejected tone was a far cry from the fierce optimism he displayed last year.

In January 2022, MilkRun raises $75M in seed capital and is backed by Atlassian founders Mike Cannon-Brookes, Scott Farquhar and others to become one of Australia’s fastest growing startups became.

Meet Young Rich Lister, the billionaire behind MilkRun

Dany Milham is the co-founder of mattress company Koala and the brain behind grocery delivery app MilkRun.

His net worth is estimated at around $150 million.

Milham was born in Byron Bay on the north coast of New South Wales.

His first entrepreneurial endeavor was building and selling gaming computers at the age of 13.

Milham then went on to work at Mude Creative before co-founding Koala in 2015.

He is considered one of New South Wales’ most successful and high-profile startup owners.

The company’s valuation was thought to be in the hundreds of millions of dollars.

Milham praised the success, telling AFR’s Yolanda Redrup in May that MilkRun would overwhelm opponents to agree to a “one-man market” for super-fast grocery delivery. rice field.

“We are Australian players. This is a great opportunity because we are going to have the entire Australian market,” he said.

“It’s the first game with the incumbent.

Milham, who is in his early 30s and has an estimated personal fortune of $153 million, was a serial entrepreneur from a young age.

Among other things, he founded a coffee company, a tree planting business and the Byron Bay skin care brand.

He won gold for Koala, a mattress delivery company he co-founded with childhood friend Mitch Taylor in 2015.

The company had sales of $165 million in 2020-2021 and was given a valuation of $500 million.

He wanted to replicate that success with MilkRun.

Initially, the promise of groceries, alcohol and other supplies delivered to your doorstep within 10 minutes proved appealing to both customers and investors.

But this week, Milham denounced Tough economic and market conditions for the final decision to close the business.

“Economic and capital market conditions have continued to deteriorate since we announced our structural changes in February, and our business remains strong, but we strongly feel this is the right decision in the current environment.” he wrote in an email to staff.

Professor Gary Mortimer, a business and retail expert at the Queensland University of Technology, told Daily Mail Australia that the MilkRun demise “wasn’t a shock”.

“For these super-grocery delivery startups, this article has been on the wall for a while,” he said.

“They have grown tremendously during the pandemic.

“Obviously, as the pandemic wore off, people started venturing back into supermarkets and seeing these businesses start to collapse.

First was Deliveroo, then Send, then Quicko and Voly.For Milk Run, it was written on the wall for a while. When you need passengers and bikes to deliver groceries, sometimes within 15 minutes, it’s very difficult to scale your business. Not sustainable.

“At 3.5% unemployment, people will choose to look for work elsewhere instead of choosing to ride their bikes.”

Professor Mortimer said small, agile start-ups like MilkRun and Voly were able to capitalize on the demand for quick deliveries in urban areas during the lockdown. This was the case for Woolworths and Metro when “turning a big ship was hard.”

However, they are now introducing their own expedited shipping service, which was putting pressure on the startup.

Professor Mortimer said, “It’s really hard to compete with big supermarkets that offer range as well as speed.

“The investments that both major supermarkets have made in their online operations and automated fulfillment centers are really scaling to enable consumers to continue shopping for food and groceries online.

“Ten cents per dollar of grocery and household items are now being purchased online, and we have the capital behind us to invest in this infrastructure, and the benefits our customers trust.”

Last year, Woolworths introduced Metro60, which aims to deliver groceries within an hour, while Coles introduced a 60-minute click-and-collect service at nearly 600 stores. UberEats also expands far beyond just takeaway food delivery.

Milham reassured employees that severance pay would be paid.

“We are always dedicated to doing things the right way, and by scaling back while we still have sufficient cash balances, we are able to ensure that our employees and suppliers are fully paid.” he wrote.

Professor Mortimer praised MilkRun’s handling of the failure.

“They ensured that the debt was met, including staff wages,” he said.

“It’s disappointing to see such a small start-up so close, but they’re not alone.”

MilkRun has been showing signs of trouble for some time. Just a few weeks ago, the company announced it would cut his 20% of its workforce.

“With rapidly changing economic and market conditions, we need to stay ahead of the curve, evolve how we operate and expand our runway for the current environment,” Milham said two months ago. wrote in a letter to the staff on

“This means making some structural changes and some difficult decisions that unfortunately affect some of our employees.”

Last June, Milham apologized to customers who complained that they did not receive their orders within the promised 20-minute window.

Milham admitted that the company had experienced an “unacceptable” decline in service.

“There are several factors that have contributed to an unacceptably poor delivery experience during busy periods,” he wrote.

“These include ongoing Covid cases impacting rider and hubstaff availability, record rainfall in Sydney and a fully employed workforce that no one has ever attempted before. It included the challenges associated with scaling at speed.”

Eight months later, when Milham laid off a significant portion of his workforce, the problem became even more pronounced, culminating in his email today.

Read emails sent to MilkRun staff

hello team,

I am writing to inform you that I have made the difficult decision to downsize my business. As a result, Milk Run will stop trading this Friday.

Since we announced our structural reforms in February, economic and capital market conditions have continued to deteriorate, and our business performance has been favorable. .

Unfortunately, this means that all headquarters, hubs and rider roles become redundant. We are all affected, so tomorrow we will share important information about our next steps. If you have any questions, contact details are in that email, but feel free to contact us directly if you need anything.

We are always committed to doing things the right way, and by shrinking our business while we have sufficient cash balances, we can ensure that we pay our employees and suppliers in full.

As part of this process, we want to ensure that everyone receives all of their statutory rights, as well as additional compensation payments and ongoing support, including counseling and relocation services.

We know that this is hard news to receive.

We are proud of the great business we have built from the growth we have achieved. We set out to change the face of Australian grocery delivery while staying true to our values, people and culture. It is thanks to the passion, dedication and hard work of so many of you that we have achieved this. You should be proud. of what we have achieved together.

We sincerely thank everyone who contributed to MILKRUN and helped create such a memorable trip.