Hey everyone, I hope you all had a great Thanksgiving break! This week I am going to talk to you about one of my favorite startups, started by a group of Stanford University students in 2013. DoorDash is a food delivery service that allows customers to order their favorite local restaurants to their homes or work, for a flat delivery price of 4 to 7 dollars.
I have been using DoorDash since 2014, and I must say that the service over the years has only continued to improve, and the quality of the mobile application has much improved as well. One of the reasons for my satisfaction with their service is the steady increase in quality of delivery person. When DoorDash came to Boston in 2014, I was always a little creeped out by the suspects delivering my food. Reflecting though, I am not so sure it was that the delivery people did not know proper delivery customs or educate. While other restaurants have been delivering food for years, I think that the DoorDash delivery experience was intended to be more professional and catering, and even deliverers who had done this for a living before were thrown off. This is why I believe it took a while before DoorDash’s workforce started to truly capture the first-class brand image that has made them so successful to this day.
On the business side of things, DoorDash has had a successful go, being valued at 700 million dollars, a valuation the owners were disappointed with! The owners aimed for a 1 billion dollar valuation and missed their mark. Market analysts product this was due to growing competition and struggles to maintain their workforce. Many similar companies are jumping on the food delivery train and some of their top competitors include Postmates Inc., Sprig Inc., Munchery Inc. and GrubHub. Along with this, one of the other biggest startups in recent years, Uber Technologies Inc. plans to expand a full-scale food-delivery service into 10 U.S. cities soon, and they plans to expand nationally.
Despite all of this, I believe that DoorDash already has such a big foot in the door that it will be hard for newcomers to take over. Along with this, I have tried Postmates, and while the food options were more upscale, I think DoorDash delivered in much lower time, at a cheaper cost and most importantly had better service. Additionally, while Uber is looking to break into DoorDash’s market, I do not think people will adapt Uber’s new change well. I think people have slotted Uber as the company that will take you to your favorite restaurant, not deliver it. Uber has tried something similar in 2015 with ice-cream delivery, and that did not go nearly as well as planned, and actually upset many drivers normal schedules and hurt their profits.
One key thing that intrigued me when researching DoorDash, was their CEO Tony Xu, who has ambitions of pushing DoorDash into the delivery of other items outside of just food. Xu is proud of the company’s analytics and delivery metrics that it uses, and claims they are heavily the reason for DoorDash’s success. As mentioned before, DoorDash’s delivery is faster than I have ever seen out of a delivery company, and I believe that their undisclosed analytics system, along with real time delivery system might give them an upper hand on many companies such as Amazon.
Overall, while DoorDash may have not have cracked its goal of a 1 billion dollar valuation, but it has forever broken into my heart. I encourage everyone to download the app and order dinner tonight! I know if I would have had no one to eat Thanksgiving with, DoorDash would have been my first call. See you guys in class tonight and happy holidays!