Uber to shut down booze app Drizly after buying it for $1.1B

Uber is shutting down its alcohol delivery app Drizly just three years after buying it for $1.1 billion.

The service boomed during the pandemic, seeing 300% year-over-year growth at the time San Francisco-based Uber inked the multibillion-dollar deal with Drizly in 2021, agreeing to operate it as a standalone app and within the Uber Eats interface to deliver beer, wine and booze to customers’ doorsteps in more than 1,400 cities. 

However, the app is now taking last calls, with plans to shutter come March 2024, an Uber spokesperson confirmed to The Post after the news was first shared with Axios.

The spokesperson also assured that alcohol delivery is still available through the Uber Eats app across 35 US states and 25-plus additional countries around the world.

In a statement to The Post, Uber’s senior vice president of delivery, Pierre Dimitri Gore-Coty, said “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.”

To further consolidate its product delivery portfolio, Uber has also closed down its on-demand grocery delivery service, Cornershop, which it acquired in October 2019 for $1.4 billion worth of stock and operated in the Latin American market, according to CNN Business.

Cornershop had been winding down, laying off 250 employees, or about 11% of its workforce, in May 2023.

Axios suggested that cybersecurity played a role in Drizly’s demise, pointing to a 2020 cybersecurity hack that exposed information on some 2.5 million customers –  a flaw the company had reportedly been aware of for two years, but hadn’t fixed.

After Uber’s acquisition of Drizly, the Federal Trade Commission learned of the faulty backend technology that failed to protect user data. 

The agency proceeded to bring sanctions against then-Drizly CEO James Cory Rellas in a rare move that required him to implement a security program at any companies he runs collecting information from more than 25,000 people.

The FTC order also applied to Drizly itself post-Uber acquisition, and limited the type of customer information the company could collect and retain.

In recent years, Uber has also gobbled up food delivery rival Postmates in a $2.65 billion all-stock deal. It’s unclear if there will be any changes to the platform as Uber looks to put more focus on its Uber Eats platform, which was launched in 2014 and now operates in 6,000-plus cities across 45 countries.