Cork's Paul O'Shea to wind up food ordering app Peckish due to 'unforeseen market changes'

Peckish was set up by Cork entrepreneur Paul O’Shea in 2019 with intentions to launch in the first quarter of 2020. However, plans were scuppered by the pandemic as restaurants were forced to close.

Cork entrepreneur Paul O’Shea has made the “bittersweet” decision to wind up his food ordering company Peckish as investors become increasingly spooked due to unforeseen market changes.

Mr O’Shea once compared his app to travel website Skyscanner, but for food instead of flights. However, Peckish eventually failed to take off and compete with rivals such as Deliveroo.

“Navigating through the highly competitive landscape, dealing with unforeseen market changes, and slower growth rates, we faced numerous obstacles,” said Mr O’Shea.

“In the end, it was simply not feasible to keep going so we made the difficult decision to wrap it up,” he said.

'High risk'

The company needed to raise €1.5m to fuel further growth but it fell short, said Mr O’Shea.

He said the appetite among investors to provide an early-stage company with that kind of capital was not there as it was seen as too “high risk”.

“The market went back to focusing on revenue generation as a key metric. It’s obviously the bread and butter of keeping a company alive,” said Mr O’Shea.

Peckish raised €125,000 through crowdfunding in 2022 and its founder thought it would be enough to sustain company growth for six to 12 months. 

However, the investment doesn’t come through until the campaign is over. 

"During the raise, we still had staff and wages to take care of. I went to one of our customers, who I had worked with as a waiter previously, and asked for a job so I could cover the team's wages," said Mr O'Shea.

However, when Mr O’Shea realised more capital would be needed, investors became spooked by a volatile economic environment as interest rates went up, and saw the collapse of Silicon Valley Bank.

Peckish suffered cashflow issues due to the lack of additional funding and Mr O’Shea started to financially support his company himself which quickly became unsustainable.

“I set a soft and hard targets and deadlines during our investment process but we didn’t hit the mark. It’s a crucial part of the game we’re in, knowing when to persevere, pivot or make the tough decision and wrap it up,” said Mr O’Shea.

Pandemic

Peckish was set up by Mr O’Shea in 2019 with intentions to launch in the first quarter of 2020 but these plans were scuppered by the pandemic as restaurants were forced to close. The company had its first full year of operations in 2021.

The app marketed different dishes to customers based on preference, dietary requirements, and cost. It also provided social media content creation for restaurants.

Mr O’Shea’s decision comes just over one year after he had laid out significant expansion plans for the company which included building a presence in Dublin and securing more funding.

Last year, around 30 restaurants and over 12,000 customers were using the app around Cork.

Mr O’Shea is still in the hospitality business, working with restaurants on a consultancy basis. But he has not left the entrepreneurial space for good.

He said he is currently taking time to speak with other founders and gain experience for his next venture.

Mr O’Shea indicated that whatever he does next in the start-up space, he is unlikely to do it alone.

“Winning as a solo founder isn’t impossible, your just decreasing your chances of success and the speed at which you can execute,” he said.

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Securing funding for early-stage companies has increasingly become more difficult in the last year. 

Some VCs are becoming more conservative when it comes to investing due to economic changes, including a series of interest rate hikes. In recent years, start-ups have received a huge amount of VC funding due to historically low interest rates which allowed them to take more risks.

Speaking to start-up entrepreneurs at an event hosted by Republic of Work earlier this year, Keving Canning, investment director of the Employment and Investment Incentive Scheme (EIIS) Innovation Fund with Quintas, said:  “People are freaked. People are afraid to do things with their money.”

Quintas is a professional services firm that operates an accountancy practice with 45 staff in Cork and 20 direct staff members in Kerala, India.

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