The food delivery world has a new player.
Lyft, the ride-hailing giant that competes with Uber, said Tuesday it will start using its drivers to deliver restaurant food via a partnership with online ordering provider Olo.
Specifically, Lyft will integrate with Olo’s Dispatch product, which works like this: When a customer places a delivery order on a restaurant’s website or app, Dispatch automatically pushes it to the optimal provider based on things like availability, timing and price. Dispatch also includes DoorDash, Uber Eats and Grubhub as well as a restaurant’s own drivers, if applicable.
Adding Lyft to Dispatch will improve delivery coverage for restaurants that use it, which should mean a better overall experience for the customer and theoretically more traffic to restaurants’ more profitable first-party channels.
Notably, Lyft won’t have a restaurant marketplace or app like its competitors. It will work solely behind the scenes as a last-mile provider, collecting a delivery fee from the consumer on each order.
“As a transportation-focused company, we aren’t interested in building consumer-facing marketplaces for groceries or food,” said Justin Paris, head of Lyft Delivery, in a statement. “But we can add real value in delivery both for drivers and partners via Dispatch’s frictionless process and the scaled national network of drivers on Lyft’s platform.”
It will have access to a big network right off the bat. Olo works with more than 500 restaurant brands accounting for over 76,000 locations, though not all of those use Dispatch.
San Francisco-based Lyft is the second-largest ride-hailing service in the U.S. behind Uber. It is available in more than 600 cities in all 50 states. It announced last year that it was exploring food delivery, noting the tension between third-party providers and restaurants over high commissions.