Uber Eats’ Path to Delivery Domination: Restaurant Inception

As numerous failed startups have discovered the hard way, the food delivery business isn’t easy — but Uber Eats is, by all accounts, crushing it. As Uber reportedly heads for an IPO, its food delivery arm is now valued by Morgan Stanley and Goldman Sachs at a hefty $20 billion, and at just three years old, it’s expected to become profitable before the ride-sharing service (which is valued at an estimated $120 billion altogether) does. Though it’s still dwarfed by competitor GrubHub, Uber Eats is the fastest-growing food delivery app: It will serve 70 percent of the U.S. by the end of the year, targeting smaller cities and suburbs for expansion.“They’re restaurant brands located in physical restaurants. And the brand only exists on Uber Eats.”

In addition to forthcoming food delivery drones, Uber Eats’ path to delivery domination involves what’s known as virtual restaurants. Virtual restaurants, also known as virtual kitchens or, more plainly, delivery-only restaurants, have existed in a few different iterations:

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