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DoorDash raises $535M, now valued at $1.4B

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Re: DoorDash raises $535M, now valued at $1.4B

#31

Post by ac29 »

bfrog wrote: post #13
notyourday wrote: post #5

Earlier quoted context omitted.

Creative accounting at its finest. Company is either GAAP profitable, pro-forma profitable, EBITDA profitable, cashflow profitable, cashflow neutral or money losing. All other metrics are creative accounting that put lipstick on a pig masking money losing status. DoorDash is money losing.

Which is amusing given they don't have to pay the actual labor to deliver goods or make food. Are they set up in the valley paying mega wages perhaps?

Not sure why you think they don't pay their drivers. The exact amount is unclear, but according to this FAQ [0], it is "at least $1" per order, and at least a variable "guaranteed amount" that door dash will pay up to, regardless of customer tips.

[0] https://dasherhelp.doordash.com/new-dasher-pay-model-faq

Re: DoorDash raises $535M, now valued at $1.4B

#32

Post by tyingq »

tyingq wrote: post #27

Doordash is a tire fire. 10x worse than Uber Eats for basic service. My experience is less than 50% success at delivering what I ordered. Missing items, wrong items, wrong totals, completely failed deliveries, and non-equitable compensation. Then, shit follow up when they fail. I’ll savor in more than a little Shadenfreud when they fold.

Downvote at will. But be brave enough to offer some counterpoint. They truly suck at delivering on their promise. That includes direct comparison to their competitors.

Re: DoorDash raises $535M, now valued at $1.4B

#33

Post by martin_bech »

thesimon wrote: post #18
martin_bech wrote: post #11

If you are "Per order profitable", why do you need 535M USD? I dont get valley valuations/Metrics..

Because you need money to cover fixed costs.

But if you need 535M USD to effectively deliver pizzas... I think you are doing it wrong. Specially if you make money on every order.

Re: DoorDash raises $535M, now valued at $1.4B

#34

Post by badminton1 »

Doordash has frequent system-wide outages.

https://twitter.com/DoorDash_Help

During their outages your items will never arrive, your order may still appear as active and customer support may handle your case in 48 hours. Plus, their outage messages are misleading.

On the other hand, Amazon almost never has outages, you can live chat with support at any moment, and if they're slightly late they will even give you money.

Re: DoorDash raises $535M, now valued at $1.4B

#35

Post by ac29 »

pavanred wrote: post #23
concernedctzn wrote: post #22

I won't use them after I tried one of their 'free delivery' codes and then the next time I went to place the same order it came out to the exact same price with delivery included, they seemed to have increased the price of the food to cover it the previous time.

The problem I have with doordash is that though they say the delivery fee is $x, there are a lot of hidden charges. You are actually paying a lot more than that, a markup on food items + a delivery fee + 8% service fee + taxes + 15% tip (optional but selected by default) + a small order fee (if your order is less than a predefined min order value) For instance, there's a a particular dish served at a local restaurant…

DoorDash doesn't mark up menu prices any more, at least in my market. Supposedly restaurants didnt like the hidden markup, so they moved all of their fees into the delivery fee and the service fee.

Its not terribly fair to consider taxes and tip as "hidden charges", IMO. The taxes you pay even if you go to the restaurant yourself, and the tip is the majority of what the drivers get paid -- they dont work for free. I'd prefer a flat driver's fee, though, its not twice as much work for someone to deliver $50 of food vs $25, so I generally don't make large orders on DoorDash.

Re: DoorDash raises $535M, now valued at $1.4B

#36

Post by foepys »

I deeply despite those third-party food delivery services. The people delivering the food are often working for less than minimum wage and are mostly using their private equipment (smartphone, bicycle, car) for delivering.

One might argue that people then should not work for those services but on the contrary why don't the services pay a fair wage and provide vehicles and devices necessary for the job? If the price gets too high, then maybe there is no market.

All of this ignoring that SV venture capital is subsidizing the erosion of other comparable jobs at small businesses that try to pay their delivery drivers a fair wage.

Re: DoorDash raises $535M, now valued at $1.4B

#37

Post by ac29 »

martin_bech wrote: post #11

If you are "Per order profitable", why do you need 535M USD? I dont get valley valuations/Metrics..

This could be early investors/founders/employees taking the opportunity to sell equity. Its possible that DoorDash itself is getting little or nothing from this deal.

Re: DoorDash raises $535M, now valued at $1.4B

#38

Post by WisNorCan »

Mitchhhs wrote: post #3

"Xu said the company became “contribution margin positive” in the last year, which means that it’s profitable on a per-order basis. In fact, DoorDash has become profitable in its earliest markets." Its funny this is a milestone for a company at this stage. Congrats you aren't losing money on every order!

> Congrats you aren't losing money on every order!

I think this misunderstands how marketplaces are built. Traditional economics would agree with you and say that selling $1 at $0.90 is insanity. Traditional economics have been slow to catch up with marketplace economics although there have been some recent papers that start explaining a better framework.

If you know that a marketplace has strong network efforts and improved performance at scale. The right strategy is to understand the trade-off between time and $ required to get to scale in your marketplace.

The optimal strategy often means subsidizing a market at a price below your actual cost for early markets. The fact that Door Dash talks about their business in terms of early vs. late markets with different economics means that they are using this playbook.

There are of course many companies that think they are building a marketplace with a network effect when they are actually just losing money. I don't know DoorDash specifically.

Re: DoorDash raises $535M, now valued at $1.4B

#39

Post by lpr22 »

ac29 wrote: post #35
pavanred wrote: post #23

Earlier quoted context omitted.

The problem I have with doordash is that though they say the delivery fee is $x, there are a lot of hidden charges. You are actually paying a lot more than that, a markup on food items + a delivery fee + 8% service fee + taxes + 15% tip (optional but selected by default) + a small order fee (if your order is less than a predefined min order value) For instance, there's a a particular dish served at a local restaurant…

DoorDash doesn't mark up menu prices any more, at least in my market. Supposedly restaurants didnt like the hidden markup, so they moved all of their fees into the delivery fee and the service fee. Its not terribly fair to consider taxes and tip as "hidden charges", IMO. The taxes you pay even if you go to the restaurant yourself, and the tip is the majority of what the drivers get paid -- they dont work for free. I'…

Menu prices on DoorDash are definitely still higher here than at the restaurant.

Re: DoorDash raises $535M, now valued at $1.4B

#40

Post by pavanred »

ac29 wrote: post #35
pavanred wrote: post #23

Earlier quoted context omitted.

The problem I have with doordash is that though they say the delivery fee is $x, there are a lot of hidden charges. You are actually paying a lot more than that, a markup on food items + a delivery fee + 8% service fee + taxes + 15% tip (optional but selected by default) + a small order fee (if your order is less than a predefined min order value) For instance, there's a a particular dish served at a local restaurant…

DoorDash doesn't mark up menu prices any more, at least in my market. Supposedly restaurants didnt like the hidden markup, so they moved all of their fees into the delivery fee and the service fee. Its not terribly fair to consider taxes and tip as "hidden charges", IMO. The taxes you pay even if you go to the restaurant yourself, and the tip is the majority of what the drivers get paid -- they dont work for free. I'…

I agree taxes are not hidden charges, but it does sound a little deceitful to me that doordash bundles taxes with their service fee as one line item on their checkout page.

And, I don't share the same sympathy for the doordash drivers. I was already charged a delivery fee and a service fee separately, why is it still my responsibility to make sure the drivers get paid enough and not doordash's. Besides, the idea of tip for me is that I pay extra if I am happy with the service, and now I am expected to mindlessly pre-pay a tip before knowing if the service is going to be good or not. A reason why I prefer ubereatz, its a rating system but after the delivery.

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