Less than a year since launching their takeout and delivery platform, the team behind DC To-GoGo is taking a break from the service.
Launched in May 2020 by the team behind Ivy & Coney – Chris Powers, Adam Fry, and Josh Saltzman – the platform was a local alternative to major delivery platforms, like Grubhub and UberEats, which charged restaurants sky-high fees. “Once delivery and pick-up became[Ivy & Coney’s] primary model, our first week of dealing with Grubhub, it was immediately apparent that we weren’t going to be able to survive under that model,” co-owner Chris Powers told DCist at the time.
Instead of collecting a 30% commission from each order like other delivery apps, DC To-GoGo only collected between 5%-15% commission per order, which allowed restaurants to pocket more revenue per order. Over the past year, it has grown from serving only Shaw restaurants to servicing restaurants spanning the city, with categories available for Black-owned businesses and vegan and vegetarian options. As of April 30, the app has gone dark — at least temporarily — while its founders think about its future.
DCist spoke with co-founder Adam Fry about what challenges DC To-GoGo faced and what would make the app sustainable going forward. This interview has been edited for length and clarity.
DCist: What led you to the decision to shutter the app?
Fry: It was a number of things. Unfortunately, sort of a driving impetus behind the conversation that led to the decision was the volume [of orders] was not quite there, in terms of reaching a point of sustainability for what we can support with our capital, what we can support with our labor. The downside is just that it ended up not growing as quickly, in terms of new restaurant partners, from a logistically sound standpoint.
Did you find you were competing with apps like DoorDash or UberEats?
We did feel like we’re competing with [DoorDash, UberEats], at times, and part of that was just because we had such small market shares going into it. As we saw a lot of the growth, that became a very real barrier. [We were] trying to market against other companies with millions of dollars of marketing money, right? Versus our very small budget with tight capital and local support, which is wonderful and came out with fervor, but at the same time … when it comes down to broad, scaling marketing, you need the dollars for it and we did not have the capital to be able to compete with DoorDash and Uber.
That was certainly part of the issue. That said, one of the things that sort of hamstringed us, and this is ironic, was the fee cap that went into place. (Editor’s note: In May 2020, the D.C. Council passed a temporary 15% cap on fees that delivery services could charge restaurants.) I’m very supportive of the fee cap, [but] our entire model was built around [offering] a 15% maximum fee. The difference is when we modeled and we built this, we were going to be comparing apples to oranges right? We knew we had a smaller market share, but we were coming in at half of the commission. And then once everyone was [charging] the same commission, it became much harder to stand out.
Were you met by any other roadblocks?
Fry: We really actually noticed an opportunity for a different sort of platform. So, as we were developing delivery and pickup for restaurants, we got a lot of feedback from other merchants, whether that be retail, pop-ups, candy stores, or even packaged food, who wanted to be able to reach out to local residents a little bit easier, almost like a marketplace … without that three to five days of waiting or without having to go through Amazon.
So, we’ve noticed a little bit more opportunity in a broader scale approach rather than shoehorning ourselves into just delivery.
Why is it hard to keep technology like this running long term? For example, OurStreets was a really great option when we were trying to find toilet paper last year, but then a few months later, it’s gone.
Perhaps the easiest answer is: There are a lot of tech platforms out there. The ingenuity is harder to come by. Developing a brand new platform is very hard to come up with. However, developing a similar-to-existing platform, but with a different model, is easier to do, but I think a lot of people run into similar roadblocks that we did. As soon as you develop enough market share to enter the space, all of a sudden you’re in the same ring as giants who have been doing it for a very long time who have a lot of money backing them.
What does financial sustainability look like to you?
It looks honestly pretty close to breaking even. The point of the business was never to become billionaires or provide this huge platform that is akin to GrubHub. What we wanted to do was be able to have a marketplace for locals that basically funded itself. The commission that came in was enough to fund the small staff that operated it. What wasn’t sustainable was just that we hadn’t built enough capital for the runway that we needed in order to retool and operate. Really what is required for sustainability is just kind of a reimagined approach to a similar problem from our end, and a bit of time in order to kind of assess what funds need to go where.
Is it even possible for a restaurant to put all of their chips in D.C. To-GoGo and ditch all over apps?
It’s a really challenging question to approach. The simple answer is yes, the more complicated answer is no, because it’s on an individual basis.
Every restaurant is so different. We did have a couple of partners who saw quite a bit of volume who were exclusive to our platform, and then we also had some partners who saw a decent amount of volume who were on DC To-GoGo, Uber Eats, GrubHub, DoorDash, the whole gamut.
[So] yes, we saw it being done, and also no [it’s not possible,] because some restaurants aren’t built for the type of delivery we were providing.
What do you need from the city?
There are always challenges when working with government entities and that’s merely because there’s a bureaucratic process that you need to go through. We’re always happy to work within those processes.
It’s more that startups want to be moving very quickly. And that’s one of the biggest challenges is: setting the pace to coordinate with government entities as well as tech startups. So there are a lot of things, if I could come up with a laundry list of things I would love to see from the D.C. government. But in terms of their support for our platform, they were hugely helpful. They engaged with us. They made available to us opportunities for labor assistance and grants.
Can you give us any sneak peek in your future plans?
The most that I can really give you is that we are working on a broader, more encompassing marketplace, rather than focusing exclusively on restaurant delivery. And we’re trying to do it so that we can offer it to a broader scale, rather than starting in pockets of the neighborhood. Unfortunately, that’s really all I can go into at the moment.