Convenience store delivery startup Lula raised a seed round after tweaking its biz model

At the end of last year, after shuttering real-time ratings app Vyb amid the coronavirus pandemic, cofounders and Drexel University alums Adit Gupta and Tom Falzani launched Lula. The convenience store delivery subscription service allows users to order from businesses like 7-Eleven or their local corner store.

The idea came about from Gupta trying to help his family’s store that closed in South Jersey during the pandemic. The technologist pair realized there was a market opportunity for a scalable, instant-needs delivery service without needing to build micro-fulfillment centers around the region, like the Philly-headquartered goPuff.

The team behind Lula is now made up of seven full-time and eight part-time staffers. The company has also shifted its business model from its original focus of hiring local, eco-conscious drivers — it pushed for carbon-neutral delivery methods like bike, scooter or electric cars — and asking a subscription fee from the consumer.

The app now digitizes a store’s items and works with third-party delivery services like Doordash, Grubhub and UberEats to list a participating store as a Lula Convenience Store. Lula sends the store sustainable packaging and a tablet to receive orders and doesn’t charge commission for orders. Instead, the store pays a subscription fees — between $50 and $99 per location per month — and gets paid back for purchases made through the app every week or month, based on their preference.

“We digitize an entire store, syndicate their inventory to all major delivery platforms (including ours), and we then also let them manage all sales through one app compared to four to six tablets,” Gupta told Technical.ly in an email.

With this new model, the company just closed a seed round of funding. They won’t share the amount, but investors include Exelon Corp., SOSV and Plug and Play Ventures, as well as some angel investors. Lula also won local VC firm Juno Capital’s Innovate Philadelphia competition back in February, which yielded a $10,000 investment.

Lula currently operates in New York, New Jersey, Florida and Philadelphia, and say partnering stores have seen a 30% increase in revenue with delivery within a 10-mile radius. The company is ready to onboard stores “remotely in all 50 states,” per a news release.

To keep its original commitment to sustainability in mind, Lula donates 1% of its sales to the global org 1% for the Planet, which connects its members with nonprofit partners focused on the environment. And the seed round will enable the company to make some senior-level hires in the Philly area, Gupta said.

“We just hired some Drexel students full time and will enable to hire more,” Gupta said. “And we also plan to expand with some larger convenience store chains so it’ll help us exponentially grow the stores we work with.”