Petco and Rover are expanding their partnership with a new initiative that will surface Rover’s pet-sitting services on Petco.com.
The deal between Petco and Rover is similar to the partnership Rover inked with Walmart, which also promotes the company’s services on its website.
Rover’s marketplace connects pet owners with service providers who can board, walk, or otherwise care for their pets, often when they’re at the office or on a trip.
It’s been a rough start to 2021 for Rover, with shares down nearly 50% amid a broader market dip for tech stocks. Shares of Rover were down more than 10% on Wednesday.
Rover is also among several companies that went public via SPAC mergers and are now seeing big drops in share prices.
Rover raised $240 million in the deal with Nebula Caravel Acquisition Corp, a publicly-traded SPAC sponsored by True Wind Capital that valued the company at $1.35 billion. Its current market capitalization is approximately $960 million.
The company has dealt with a recent uptick in cancellations due to the ongoing pandemic, but last month it confirmed its previously announced revenue guidance of $106-to-$110 million for fiscal 2021.
Rover reported third quarter revenue of $35 million, up 31% from the same period in 2019 (Rover compares to 2019 due to COVID impacts throughout 2020). It posted a net loss of $84.5 million, which it attributed largely to non-cash accounting adjustments related to the SPAC transaction.
Rover’s business that was hit hard when the pandemic began, but rebounded thanks in part to rising pet adoption rates and increased spending on pets. Those trends also helped fuel growth for Petco, which went public for the second time last year via IPO and reported a 15% increase in third quarter revenue to $1.4 billion.
Rover last year ended its dog-grooming services, citing challenges of the labor market.