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DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

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Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#11

Post by ar7hur »

Congrats to the team!

I respect what you've done so far, but I can't help wondering how investors can base their analysis on an experiment restricted to Palo Alto, Mountain View and San Jose. From what I see, the bulk of orders (in $) are from fellow startups ordering lunch and dinners. Where else is the world (except SF and maybe NYC) do so many companies, in such a small geography, order so much food from restaurants?

I'm not saying it's not a good business. I'm wondering if there is really room for growth (a growth big enough to justify the huge series A valuation) outside of very specific geographies.

Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#12

Post by jconley »

ar7hur wrote: post #11

Congrats to the team! I respect what you've done so far, but I can't help wondering how investors can base their analysis on an experiment restricted to Palo Alto, Mountain View and San Jose. From what I see, the bulk of orders (in $) are from fellow startups ordering lunch and dinners. Where else is the world (except SF and maybe NYC) do so many companies, in such a small geography, order so much food from restauran…

Well, you are talking about over a million people in that area. I'd say that's a reasonable sample size. Also, not sure we know who their clientele are. We use doordash for the office, but I also use it at home. Because of their level of service it has also become a destination site, where I go to see what they offer first rather than choosing the restaurant I want first. I imagine I am not alone.

Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#14

Post by untog »

ar7hur wrote: post #11

Congrats to the team! I respect what you've done so far, but I can't help wondering how investors can base their analysis on an experiment restricted to Palo Alto, Mountain View and San Jose. From what I see, the bulk of orders (in $) are from fellow startups ordering lunch and dinners. Where else is the world (except SF and maybe NYC) do so many companies, in such a small geography, order so much food from restauran…

Well, look at Seamless. It's quite possible to just have a business that focuses on these major metro areas.

That said, I'd still be dubious of a company that only operates in California. Markets like Chicago and NYC are quite different.

Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#16

Post by paul »

So exciting! This is actually a surprisingly difficult business because of the need to be so fast and efficient, and there was a lot of skepticism early on as to whether there was actually a viable business in this space. The DoorDash team has done a great job of proving the model and creating a playbook for scaling and expanding the business. They are one of the startups that I most often refer to when advising new YC companies.

Also they feed me! (that was one of the key questions I asked during interviews: "Will you deliver to my house?" They answered correctly! :)

Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#17

Post by iandanforth »

I've never seen a restaurant post a menu on its website with different prices than what you would find in person, however this is exactly the business model of DoorDash. My question is, why don't restaurants do this? Is it illegal? Out of laziness? A tacit custom? Genuinely curious about this.

Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#18

Post by jvrossb »

ar7hur wrote: post #11

Congrats to the team! I respect what you've done so far, but I can't help wondering how investors can base their analysis on an experiment restricted to Palo Alto, Mountain View and San Jose. From what I see, the bulk of orders (in $) are from fellow startups ordering lunch and dinners. Where else is the world (except SF and maybe NYC) do so many companies, in such a small geography, order so much food from restauran…

Some college towns will have a high density of students ordering food from restaurants.

Re: DoorDash (YC S13) Raises $17.3 Million From Sequoia To Expand On-Demand Delivery

#19

Post by rdoherty »

rayiner wrote: post #15

I don't get this. How often do people order-in from places that don't deliver? Is this a Bay-area phenomenon? Or is this more of a replacement for the restaurant owner's teenager?

There's a lot of great restaurants that don't deliver in the Bay Area (and probably elsewhere). With most startups offering catered lunches and dinners there's a strong demand for delivery of food better than pizza.
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