
DoorDash Raises $40M, Led by Kleiner Perkins Caufield and Byers - stanleytang
http://blog.doordash.com/post/114687483313/doordash-raises-40m-led-by-kleiner-perkins
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bkjelden
My wife and I used DoorDash pretty extensively when we first moved to the bay
area, we were living out of a hotel for a few weeks.

It was interesting how our reactions to the site differed. I was just happy to
have a one-stop list of delivery restaurants with no phone calls, no
complicated payment info, etc.

Her reaction was "There's no pictures! I just want someone to tell me what I
want to eat!"

Now, whenever I go to their homepage I see a huge missed opportunity to sell
advertising. As sites like DoorDash become well-known hubs for the logistics
services they provide, I wonder if they will take advantage of the huge set of
eyeballs landing on their homepage with open wallets. And for a restaurant, a
well-done DoorDash campaign could be more effective than Facebook/TV/radio
marketing.

I do see myself stuck with a bit of a paralysis of choice when I land on their
homepage. Sure, there's 50 restaurants near me that I can order from, but all
I really know is that I'm hungry right now. Some help choosing would be nice.

~~~
susied
"I just want someone to tell me what I want to eat!"

"Sure, there's 50 restaurants near me that I can order from, but all I really
know is that I'm hungry right now. Some help choosing would be nice."

We just linked to your comment on our YC application because we're solving
this exact problem. Contact me (see profile) if you're interested in being
part of the private beta.

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jasondc
In Palo Alto, there are DoorDash workers EVERYWHERE. Literally every
restaurant you go into you see a bunch of people in red shirts picking up
meals. I'm curious how this will do in other parts of the country.

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downandout
Wow what a crowded space. This reminds me of the daily deals site era, but at
least then there was some room to compete because there wasn't a $40 billion
behemoth waiting to crush them. I suspect that at whatever point Uber
Logistics (or whatever they choose to call this inevitable extension of their
service) takes flight, DoorDash and its $40 million will quickly vanish. This
definitely isn't a space I would be doing a startup or investing in at this
point.

~~~
paul
Many things look similar from a 1000 miles away. At the actual business level,
Uber and DoorDash are different in almost every way. This is one advantage
that investors close to these companies have, and one reason why it can be so
hard to understand any of this just by reading blog posts. DoorDash has a
great business, in many ways better than Uber's.

~~~
downandout
Whether carrying passengers or food, they are both in the delivery business.
The primary difference is that one is worth $40 billion and one is not.
Doordash may have some restaurant relationships that Uber doesn't, but that is
ground that can be quickly made up with money. These VC's are merely hedging
their bets with this investment.

~~~
paul
In that case you should assume that FedEx will put them all out of business.
There's a lot more going on than "delivery".

~~~
downandout
I wouldn't assume that. Fedex has many constraints on its business, and shares
almost no core competencies with DoorDash or Uber. Its fleet consists not of
nimble passenger cars, but of large, fuel guzzling trucks - making one-to-one
pickups and deliveries inefficient and unprofitable. It also has no expertise
in the area of recruiting independent contractors to perform work for it,
which is one of the core competencies of both DoorDash and Uber.

I wouldn't turn to DoorDash to deliver live lobsters to me from Maine
overnight, and I wouldn't turn to Fedex to get me food from down the street.
Those are very different businesses requiring very different infrastructures.
Therein lies the problem for DoorDash: they are not that different from Uber.
They have similar core competencies, but Uber is vastly better known and
financed.

~~~
toomuchtodo
I feel like your post highlights one of the glaring problems with the SV/SFBA
echo chamber.

Uber, DoorDash, whatever, they're services glued together with server-side
logic and mobile apps.

Fedex, UPS, and I'll even lump Amazon in there. These are logistics
powerhouses. Their physical world equipment isn't a liability, its their
advantage. Fedex and UPS have knowledge on how to manage a fleet of hundreds
of aircraft, thousands of long-haul tractor trailers, tens of thousands of
local delivery trucks, and hundreds of thousands of employees.

Your app does not have that. You have users. You have VC money. And while you
might think you're more agile than logistics dinosaurs, they have the upper
hand. Good luck.

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gmisra
It's disappointing to see that the biggest "disruption" in the logistics space
involves shifting risk further down the economic hierarchy. The most difficult
part of last-mile logistics has been capacity planning, both human and
infrastructure. And yet, much of this risk is now being pushed down to the
entities least capable of absorbing it - what is the opportunity cost of being
"available" as a DoorDash driver for a given shift with non-guaranteed
compensation?

The message that is emerging loudly from the SV VC community is that they
believe this model is one that should be pursued, aggressively. Let's be clear
that in terms of labor and risk management, this is not innovation, it is a
return to the status quo of a century ago - one that we as a society fought
hard to change.

I fear that the plan is to just fight the legal and PR battles, and hope that
the robots arrive fast enough and make the situation moot (aka the Foxconn
gambit).

~~~
paul
I've talked to the drivers for a lot of different services, and they seem to
enjoy the work. In particular, these on-demand services offer a lot more
flexibility than traditional jobs where you are expected to show up every day
and sit in a chair for 8 hours.

~~~
jaydz
Traditional jobs guarantee a wage for those 8 hours. Most on-demand services
guarantee nothing. I'm glad DoorDash at least guarantees an hourly wage in
some markets.

~~~
paul
My brother-in-law quit a traditional job to drive for Uber, so he must think
it's better. (also, he told me that for the first time, he's excited to work
in the morning) It's a pretty competitive market -- if a service doesn't
provide enough work, they won't be able to retain drivers (plus many people
drive for multiple services, especially Uber/Lyft drivers).

~~~
derefr
This is a case where money and happiness aren't really correlated. Remember,
people get addicted to variable reward schedules, and get bored of fixed
reward schedules. Want someone to be more excited to go to work? Flip a coin
to determine whether they get paid each day!

~~~
sireat
This is also why games put random drops in your grindable content.

And why despite the satiric premise behind
[http://progressquest.com/](http://progressquest.com/) it is weirdly
addicting.

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7Figures2Commas
It's interesting to see investors continue to pour lots of money into startups
that classify their workers as independent contractors even though the risks
of doing so are clear, immediate and growing[1][2]. The lines between employee
and independent contractor _are_ somewhat blurred in _some_ cases, but given
how important the cost shifting is to the economic viability of many of these
companies, a lot of these investments are damn near binary. That's fine when
you're investing a few hundred thousand or even a few million but not at all
necessary in today's market when you're investing $40 million.

In this case, it's also somewhat ironic that Kleiner Perkins is the lead
investor.

[1] [http://www.latimes.com/business/technology/la-fi-tn-uber-
lyf...](http://www.latimes.com/business/technology/la-fi-tn-uber-lyft-class-
action-2015-03-12-story.html)

[2] [http://time.com/3748438/instacart-
lawsuit/](http://time.com/3748438/instacart-lawsuit/)

~~~
andy318
Yup. The new bus service in SF - [http://rideleap.com](http://rideleap.com) \-
classifies the bus drivers as independents. From their ToS (excuse the all
caps)
[https://app.leaptransit.com/webterms](https://app.leaptransit.com/webterms)
\- LEAP DOES NOT PROVIDE TRANSPORTATION SERVICES, AND LEAP IS NOT A
TRANSPORTATION CARRIER. IT IS UP TO THE DRIVER OR VEHICLE OPERATOR TO OFFER
TRANSPORTATION SERVICES WHICH MAY BE ARRANGED THROUGH USE OF THE SERVICES

~~~
7Figures2Commas
Hilarious. That's like United saying, "We aren't an airline. It's up to the
pilot to offer a flight which may be arranged through united.com."

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habosa
Surprised not to see a mention of Postmates here. At least in San Francisco
I'd consider Postmates to be the front runner for door-to-door delivery
services, followed by Door Dash (sort of an Uber v. Lyft dynamic).

I am not a frequent customer of either but I actually do occasional bike
deliveries for Postmates (about 5 deliveries a week, on the weekends).
Postmates has insane demand, whenever I sign on the deliver my phone is
practically exploding with orders, even when they turn on 'blitz' pricing (and
it's not cheap to begin with). The product seems simple but I am very
impressed with Postmates' logistics.

Postmates basically has a comprehensive listing of not only all the places to
buy things in the city (mostly food but not only) but they know the full menu,
item by item pricing, if they accept cash/credit, open hours etc. So you can
place highly specific orders. Postmates gives each courier a credit card which
they load with about how much money you will need for a given delivery on
demand so you can pick up an iMac or a burrito through the same process. They
also have a 24/7 customer and courier support network. So if I get a flat tire
on my way to deliver a sandwich they can actually try to get another Postmate
courier nearby to come finish the delivery.

And recently Postmates has started working closely with some restaurants to
provide "turbo" jobs, where the restaurant knows the order is for postmates,
provides postmates with an ETA for when it will be ready, which means I can
get an order saying "Go to XXX restaurant, the sandwich is already prepared
and paid for" and pick it up and go. This enables me to get food to most
customers about 30-40m after they order it from anywhere in town.

Anyway those are just some things that came to mind. There is a lot more to it
(scheduled shifts, tipping, etc). It all goes to show how interesting these
seemingly simple ideas are from the inside.

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caseyf7
My favorite part of DoorDash is how they got the tipping right. Add it upfront
and then they just quickly drop off the food. Munchery is awkward because
you're never sure if the person that ordered it included the tip and the
driver is hanging around awkwardly making small talk.

~~~
mschaecher
Munchery is upfront in app too.

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pairing
I use doordash quite often. Their delivery process is excellent and if you get
two meals out of a delivery of one meal (the portions at most places are
pretty large) the costs are comparable to eating out.

I'm glad to see they've received more funding. In the south bay at least,
doordash far exceeds the competition for the variety of restaurants they
offer.

The startup class talk by one of the founders was also quite good.

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vladgur
im just waiting for the promo codes that follow these funding rounds

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s_q_b
What's the key differentiator from Grubhub/Seamless, or is it simply a direct
competitor?

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alaskamiller
Waiter.com is pissed

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jpeg_hero
I always download stupid SF apps to do my part to throw off the numbers ;)

