For those investors who focus on the long game, two pieces of information on the food delivery world will buttress that view.

The first was a 70-page research report by the U.S. broker, Cowen & Co. Over the next five years the firm expects the market will rise by almost 80 per cent or more than 12 per cent a year on a compound growth basis. Based on those forecasts, the industry — which also includes meal-kit providers — would be a US$76 billion market at the end of 2022.

“We are raising our industry estimates in our restaurant delivery model given encouraging proprietary survey data,” said the report. “In our view, the key driver is online order growth,” it added, noting the survey data indicates a “virtuous cycle in which increasing supply of delivery options leads consumer demand.”

In this way, the report notes that the world of food delivery is set to grow faster than the “mature total restaurant industry,” with the latter expected to chug along at 3.5 per cent annually.

In other words, dining in is the new dining out.

Closer to home, Goodfood Market Corp. which went public earlier this year via a reverse takeover with a capital pool company, released its first set of financial results. And those results showed that there continues to be a growing acceptance of the sector. At the end of May the Montreal-based company stood at 23,000 active subscribers — up by 10,000 from three months earlier.

Other metrics, including gross merchandise sales, revenues, gross profits and profit margins, also moved in the right direction. “The Canadian meal-kit industry is still in its early stages and we are well-positioned to consolidate our leadership position,” said Jonathan Ferrari, chief executive, who in an interview thinks the industry will grow to $3 billion in five years. As part of going public, Goodfood also raised $21.1 million by way of a private placement. (Each share was priced at $2 apiece.)

And that capital raise will help the company to expand its marketing efforts, in increasing its subscriber base, in expanding its distribution facilities and in establishing a national presence over the next year. The goal is to grow and achieve economies of scale.

One month back, Goodfood signed a five-year lease on a new distribution facility in suburban Montreal. The new facility, which will cost almost $3 million over the five years, is five times as large as its previous location.

The results indicate that access to capital and solid financial backing is required, given that it generally takes a long time to build acceptance. For the past nine months ended May 31, the newly public company incurred a net loss of $6.1 million. The shares closed Friday at $1.64.

But despite the seemingly positive trends, companies new to the sector can still be thrown off course by events. Consider the recent initial public offering of Blue Apron.

A few days before that IPO was priced, Amazon.com announced its $13.7 billion acquisition of Whole Foods. The original plan was to price the shares in the US$15-US$17 range, but Amazon’s acquisition and the general tone of the market caused the issue to be priced at US$10 a share. In other words, investors were not prepared to fund the company on the high valuation derived from previous fundings.

Against such a sentiment, Blue Apron, which raised US$300 million in its IPO, has struggled as a public company. It has traded in the range US$7.14 to US$10 and closed Friday at US$7.36.

bcritchley@postmedia.com