Austin-based Favor Raises $22 Million in Funding

Photo courtesy of Favor

The Austin-based on-demand delivery service, Favor, announced Thursday that it has reached profitability and raised $22 million in venture funding.

S3 Ventures led the Series B financing round, which included existing investors.

“Scaling a high-touch, hyper-local logistics business is no easy task, and all the credit goes to our team’s relentless focus executing on our strategic growth plan,” Jag Bath, Favor CEO said in a news release. “Achieving profitability at this scale, and the vote of confidence from our existing investors, is validation of what we are doing and underscores the future of the on-demand economy.”

Favor plans to use the funding to continue its growth in the Texas market and beyond. To date, the company has raised $34 million. It previously raised $12 million in Series A round of funding led by S3 Ventures with participating from seed investors Silverton Partners, venture capitalist Tim Draper and others.

“Favor has proven that they are building a healthy, scalable business while maintaining their superior service and strong position in the on-demand delivery market,”Brian R. Smith, S3 Ventures Managing Director, said in a news release. “The company’s decision to avoid growth at all costs to instead focus on surgical, smart growth, has led them to beat their profitability goal by six months—a truly impressive achievement. We remain excited and confident in Favor’s future as they build upon this success.”

Favor has made six million deliveries since its launch and plans to make four and half million this year. To meet demand for its services, the company is hiring more than 25,000 independent contractors.

Founded in 2013, Favor is currently available in 15 cities across Texas.

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