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goPuff, Philly’s own on-demand delivery company, plans massive warehouse expansion in Pa.

The company, known for its raunchy marketing, plans to open 10 warehouses across the state in the next three years.

goPuff co-founder and former Drexel student Yakir Gola, 23, in their expanded warehouse on July 11, 2017.
goPuff co-founder and former Drexel student Yakir Gola, 23, in their expanded warehouse on July 11, 2017.Read moreCHARLES FOX / Staff Photographer

GoPuff, the on-demand delivery company founded by two Drexel undergrads, just announced a massive expansion in Pennsylvania.

Backed by $400,000 in state money and a potential $2.5 million in city loans, it plans to open 10 warehouses across Pennsylvania over the next three years, as well as a new, 30,000-square-foot headquarters in Northern Liberties, at the former Irish bar Finnigan's Wake. The company says the expansion, which is estimated to cost $4 million, will double its workforce to create more than 500 jobs. Four hundred of those jobs will be in goPuff's warehouses.

The city has offered goPuff two kinds of loans, both administered by the Philadelphia Industrial Development Corporation. The first is a $500,000, zero percent interest loan with terms that are based on job creation: If goPuff creates 380 full-time jobs in a five-year period, it will not have to pay the city back. The other loan is a $2 million, below-market-rate loan for real estate purchases and renovation costs. The company has accepted the $500,000 loan but is still working out terms of the $2 million loan, said city spokesperson Deana Gamble.

The expansion represents a major development for what began as an online delivery start-up for college students with the munchies. Though it still sells all manner of partying paraphernalia, from hookahs to weed grinders to beer, and has retained its raunchy marketing ("We come fast," reads one bus wrap), the five-year-old company founded by Yakir Gola and Rafael Ilishayev is now in nearly 50 markets in 21 states, employing 500. (That number does not include drivers, which goPuff declined to share.) It plans to be in 60 markets by the end of the year, said spokesperson Liz Romaine.

The company's search for a new headquarters was in part prompted by complaints from residents in Callowhill, where its current headquarters is located, the Philadelphia Business Journal reported in July. GoPuff drivers would break traffic and safety rules, as well as park in prohibited areas while making pickups from the company's warehouse, one resident alleged. The warehouse in Callowhill will remain for now but will eventually move, Romaine said.

Matt Ruben, president of the Northern Liberties Neighbors Association, said he was thrilled about the prospect of goPuff giving new life to the long-vacant Finnigan's Wake space. The company has plans to upgrade the facade of the building, which stands at a prime location on Spring Garden Street — "gateways to the south and north," he said — and goPuff will bring staffers who will patronize local businesses.

Because of its proximity to the El and Indego bike share, he's hopeful it won't significantly disrupt residential parking.

"But that's why the good Lord invented residential parking permits," he said.

GoPuff currently has five warehouses in the Philly area, including three within the city: in Manayunk, the Northeast, and Callowhill. The company determines where to open warehouses based on demand, Romaine said. Outside of Philadelphia, goPuff operates statewide in Bethlehem, State College, Pittsburgh, and, soon, West Chester.

While the online delivery landscape is crowded, goPuff sets itself apart with its speed (it promises 30-minute deliveries), its flat delivery rate ($1.95), and its array of products — all of which it stores in its own warehouses, rather than having drivers pick them up from another store. It's something of a drugstore, grocery store, and party store all in one. Competitors include Postmates, which will deliver anything to customers for a fee ranging from $1.99 to $9.99, and Amazon Prime Now, which launched in Philly earlier this year and has a $35-order minimum.