An Update on Our Work to Build Trust on Our Platform

We deeply value the trust we’ve built with every member of the DoorDash community and the wider public. They expect us to know who is using our platform, who is entering their businesses, and who is delivering.

It is why we’ve put in place a robust, multi-layered identity verification and screening process to help ensure Dashers are who they say they are and help prevent bad actors from using our platform. Before someone can dash, they must verify their identity with a current, valid government ID via a two-step process and complete a background check, including criminal and motor vehicle history reports. Since 2014, we’ve completed background checks on more than 24 million people in the United States alone.

Identity Re-Verification

Today, we’re further strengthening our screening process with identity re-verification for Dashers in the United States. To help ensure that every Dasher on the road is who they say they are and prevent inauthentic accounts from being active on our platform, Dashers are required to re-verify their identity by providing a selfie that matches their government ID.

Here is how identity re-verification works:

  • Dashers will receive a request to re-verify their identity
  • Dashers must take a selfie that matches the picture on the ID they previously submitted
  • Our third-party vendor, Persona, will verify the Dasher’s identity


    re-IDV

We use a number of signals to detect signs of potential account inauthenticity, which triggers requests for Dashers to re-verify their identity, including the number of devices used to log into a single account, whether key account details such as phone number or email address have been repeatedly changed, and if key account details are linked to previous accounts or applicants.

If a Dasher’s selfie matches their government identification, they’re instantly able to resume dashing. If their identity cannot be verified, the Dasher account will be suspended and they will no longer be allowed to dash. All Dashers will have the opportunity to appeal this decision, and every appeal is reviewed thoroughly and carefully before a final decision is made.

We recognize that no system – however thorough or sophisticated – is perfect. That’s why we’re constantly looking for new ways to further strengthen our identity verification and screening processes, and to continue to promote trust and confidence in the DoorDash platform.

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DoorDash and Staples Partner for On-Demand Delivery

Fill Those Backpacks in Record Time

Today, DoorDash and Staples announced a new partnership to give consumers convenient on-demand access to thousands of back-to-school and workplace essential items. Whether it’s for the first year of elementary school or the first year of college, students can now get all the items on their supply list delivered same-day in under an hour, on average, directly to their door.

Nearly 1,000 Staples U.S. locations are now available on the DoorDash marketplace offering consumers easy access to all they need for a successful school year. Staples’ wide selection of pencils, crayons, glue, scissors, binders, lunch boxes, index cards, notebooks, printers, calculators and so much more are now on the DoorDash Marketplace. Parents, teachers and students at every grade can find and order just what they need on-demand, at the tap of a button.

To kick off the 2023 school year, U.S. consumers can get $20 off Staples’ orders of $40+ using code STAPLES20, now through August 13.* Staples’ products are available on DashPass,** DoorDash’s membership program that offers $0 delivery fees on eligible orders from thousands of grocery, convenience, and retail stores nationwide. DashPass members can enjoy these benefits on all eligible orders from Staples that meet minimum subtotals.

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Wingstop drops Olo in favor of $50M in-house tech

Dive Brief:

  • Wingstop, which accounts for 3% of Olo’s revenue and 1,800 of the 78,000 locations using its technology, will leave Olo’s platform for its own technology when the contract between the two expires at the end of fiscal Q1 2024, Olo confirmed on its Q3 earnings call earlier this week. 
  • Last week, Wingstop CEO Michael Skipworth said on Wingstop’s Q3 earnings call that the brand “built a platform with the most modern technology within our tech stack,” and will roll it out in Q2 2024,.
  • Olo said the move was unusual and that it generally sees brands move from in-house tech solutions to its platform.

Dive Insight:

Wingstop began investing $50 million in its platform three years ago, Skipworth said. Given that Olo revealed its brand contracts typically last three years, its possible Wingstop has spent the whole of a contract cycle building up its tech products in preparation for departure from Olo’s platform.

Olo CEO Noah Glass said Wingstop was employing “the right strategy in that every brand should be focused on getting to 100% digital, collecting and using data to increase conversion and frequency to drive traffic. But we think it’s the wrong tactics in building a homegrown software. That’s very expensive.”

Wingstop’s new platform, Skipworth said, serves the dual purpose of protecting the brand’s digital business, which now accounts for $2 billion in sales, and creating “an increased level of hyper-personalization that we believe will improve conversion retention rates and ultimately drive frequency.”

Olo was unaware of any other brands undertaking similar measures, and Glass said the size of Wingstop’s investment in in-house tech, versus’ the $90 million Olo spends to maintain and improve its tech platform is “a case study in the economies of scale of a [software as a service] platform. That’s not a belief, that’s not even a judgment, that’s just math.”

“We don’t take any enterprise brand out of our addressable market and we won’t be satisfied until 100% of them are Olo customers,” Glass said.

On the operational side of things, Skipworth framed the in-house tech solution as a win for franchisees, as it would provide “more insights and more visibility into the business within the four walls of the restaurants.”

According to Wingstop’s 2023 Franchise Disclosure Document, franchisees developing a store pay $15,581 to  $23,655 for point-of-sale, back-office software, hardware and related items. The cost of maintaining that technology and its licenses comes to about $5,000 to $6,000 per year. However, it’s unclear what portion of that spend goes to Olo.

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Just Eat Takeaway CEO: Grubhub sale attempt has been ‘complicated’

Just Eat Takeaway’s pending sale of Grubhub has been complicated, CEO Jitse Groen told investors Wednesday. Groen said conversations are ongoing, but M&A activity in the U.S. has been slow.

Existing fee caps, especially in New York City, have made conversations regarding the sale difficult, especially since they make “it tough to put a decent multiple on Grubhub,” he said. Groen did not provide further details on which types of parties JET has already held discussions with.

Just Eat Takeaway has been looking to sell Grubhub, or to enter into a strategic partnership, since April 2022. JET originally bought the company for $7 billion in 2020. By 2021, JET was under pressure from activist investor Cat Rock Capital to sell the subsidiary, which Cat Rock Capital said was reducing JET’s overall value. In August 2022, JET reported a goodwill impairment of about 3 billion euros ($3.04 billion) related to its Grubhub acquisition that was caused by a reduction in sector value rather than Grubhub’s operational performance.

What’s happened since Just Eat Takeaway’s pending Grubhub sale

Grubhub’s cash flows have improved and are on a path to breaking even, minus the impact of New York City fee cap amendments. With pending lawsuits against the fee caps in New York City, Groen said he expects the caps to eventually end, but doesn’t know when.

“If the fee caps roll off great, then the profitability profile [at] Grubhub starts to look like the rest of the business,” Groen said. “But it’s difficult to control things that we don’t control.” 

During the first half of the year, Grubhub’s cash flow was negative 56 million euros ($62 million), compared to 136 million euros ($150 million) reported in the first half of last year. 

Groen added that the company expects a $30 million run-rate savings from 2024 onwards following Grubhub’s recent restructure. That reorganization, which occurred in the second quarter, resulted in a staff reduction of 400 employees. JET also hired a new CEO at Grubhub in March. 

Grubhub has achieved a few wins, however. Its Amazon/Grubhub+ partnership, which began in 2022, was extended for another year and provides the company with a competitive advantage and “represents significant opportunity for future growth,” Groen said. That partnership provides a free year of its subscription membership to Amazon Prime members. This month, Grubhub also updated its subscription program with more perks, including lower service fees and a 5% credit on pickup orders.  

Grubhub has made a few upgrades to its products, as well. In February, it added three features to its Direct platform, which offers commission-free branded online ordering for independents. Those features included an integration with Google Business profiles and a $0 delivery fee per order (previously $1.99). In May, Grubhub enhanced is Grubhub for Restaurants portal with customer insights, self-serve refund request and self-serve photo shoot access.

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DoorDash Sees Record Orders, Showing Appetite For Delivery

    (Bloomberg) — DoorDash Inc. reported a record number of delivery orders in the second quarter, showing consumers’ commitment to takeout despite rising prices.

    The shares jumped about 4% during premarket trading in New York on Thursday. The stock has advanced more than 75% for the year to date, closing at $85.98 a share on Wednesday.

    Customers placed 532 million orders in the quarter and the gross value of those orders rose 26% to $16.5 billion, the company said in a statement. The increase was driven by strength in DoorDash’s core restaurant business and traction in newer categories, like convenience and groceries. The company boosted its outlook for gross order value for the full year to $64.2 billion to $65.2 billion.

    San Francisco-based DoorDash enjoyed a boom in demand during the pandemic when indoor dining shuttered and people stayed home. Its share of the market for US food-delivery sales rose to 65% as of June, according to research from Bloomberg Second Measure. Since then, DoorDash has parlayed its popularity to deliver more than just meals in an effort to generate new sources of growth.

    DoorDash has tried to blunt the impact of rising restaurant prices by offering incentives. The company, which launched an advertising business last year, has leveraged ads and sponsored promotions to offer customers better deals. It has also attracted more users to the app, and kept current customers spending more, through subscription service DashPass. For a monthly fee, members have access to special deals and perks like reduced delivery fees.

    While DoorDash’s restaurant and convenience delivery units are profitable, its other verticals still lose money. DoorDash, which laid off about 6% of its workforce last year, said it expects to be “disciplined” with operating expenses for the remainder of the year. The US’s biggest food delivery company reported a net loss of $172 million, driven by higher stock-based compensation expenses as well as spending to expand outside of meal-delivery. Revenue rose 33% to $2.13 billion, slightly beating analysts forecasts for $2.05 billion.

    “We have begun investing significant capital to build businesses in new verticals, international markets and advertising, and we have a number of newer projects that are in various stages of testing,” Chief Executive Officer Tony Xu and Chief Financial Officer Ravi Inukonda said in a letter to shareholders.

    The acquisition of Finnish food-delivery startup Wolt Enterprises Oy, which closed last year, helped DoorDash establish an international footprint. Absorbing those employees into DoorDash’s overall headcount has come at a cost, however, and contributed to the spike in stock-based compensation expenses. Inukonda didn’t specify whether DoorDash would consider additional layoffs, saying the company is “happy with where we are.”

    DoorDash said adjusted earnings before interest, tax, depreciation and amortization reached $279 million during the period, beating Wall Street’s estimate of $214.5 million.

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    Tipping ‘nudges’ are now popping up on DoorDash. If you don’t leave a gratuity, you’ll hear about it.

    Customers have long been asked to tip the people who deliver their take-out or groceries. Now, that pressure is even greater, thanks in part to “tip nudging.”

    At the center of the latest tipping debate is DoorDash. In late June, DoorDash rolled out a new app feature that allows delivery customers to increase a tip for drivers up to 30 days after a food delivery is completed. Customers that have not tipped will be prodded to do so. These nudging notifications are becoming more common — Uber Eats, Instacart, and Starbucks have similar messages for customers. 

    “These new nudges and reminders will encourage customers to tip and show their appreciation after their Dasher delivers an order,” DoorDash executive Austin Haugen said during a media event in late June. 

    “Consumers who are waiting to see how the Dasher provides service … now have a way to actually reward Dashers,” Rajat Shroff, DoorDash’s head of product & design, said during the event. 

    Some DoorDash drivers say the new nudge might bother customers. But for many drivers, tips have become increasingly important.

    “I think it would be annoying to 80% of customers,” said Heather Taylor, who drives in Corpus Christi, Texas. But she added, it could improve her income. 

    Base pay for DoorDash orders is as low as $2, making tips a key source of income for workers

    DoorDash’s tip nudges come as some delivery workers have aggressively attempted to increase tips. Some delivery workers have tried to increase their gratuity by asking DoorDash customers for higher tips mid-delivery. In other cases, Dashers have shamed customers over low tips. DoorDash prohibits these sorts of actions.

    DoorDash’s nudges will appear for customers who have not already added a tip to their order. “Customers get a maximum of one nudge per order that does not include a tip,” the company said in a statement. “This is not unique to DoorDash and is common practice across gig platforms.”

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    Uber and Instacart are a bit more intrusive with their tip nudging. 

    DoorDash post-checkout tipping
    DoorDash introduced post-checkout tipping. 

    “We’ve rolled out tipping prompts to encourage customers to consider increasing their tip anytime they rate a shopper five stars,” Instacart said. “The prompts also encourage customers to recognize their shopper’s hard work by leaving a tip if they initially choose not to leave one.”

    Uber Eats told Insider it has “invested heavily into improving the tipping experience for drivers and couriers” over the last two years. That includes adding tipping prompts throughout the user experience, including encouraging tips during inclement weather. 

    Uber Eats said it has made app improvements to improve tipping behavior, including encouraging customers to tip when placing the order, during the order, and after the order. 

    As a result, the average food delivery tip has increased by 20% from 2020 to 2022, Uber Eats told Insider.

    DoorDash told Insider ​​that base pay “generally ranges from $2 to $10 per order, depending on various factors including the estimated duration, distance, and desirability of the order. With tips and base pay, DoorDash said on average, Dashers make $25 per hour on active deliveries. 

    “Dashers on our platform are earning more today than ever before on delivery and have earned more per active hour every year for the past four years,” DoorDash told Insider.

    Many gig delivery workers make below minimum wage and say their earnings have fallen since the height of the pandemic

    A 2020 study found many gig delivery workers are struggling to make minimum wage. The survey of gig workers from the Economic Policy Institute found that about 14% of gig workers made less than the federal minimum wage, and 29% earned less than their state’s minimum wage. The survey was conducted in 2020, a banner year for gig workers due to demand for delivery early in the pandemic.

    The number of people working gig jobs grew sharply during the pandemic. But since then, demand for delivery has declined, particularly in grocery. That leaves fewer orders for more workers.

    Sergio Avedian, a spokesman for The Rideshare Guy blog who delivers about 20 hours a week in Los Angeles, said his base pay ranges on DoorDash or Uber Eats from $1.50 to $3 per order — 50% less than the height of the pandemic when earnings surged due to demand. Other drivers speaking to Insider quoted similar declining base pay.

    “When base pay is so low, we have to look for high-tip, low-mileage orders,” he said. “We are literally working for tips.”

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    DoorDash Introduces AI and Agent-Powered Voice Ordering Solution

    nnovative white-label voice ordering technology will enable select operators to increase revenue and maintain high-quality customer experiences, without increasing labor costs or sacrificing hospitality.

    DoorDash today announced its development of voice ordering capabilities incorporating AI, building on its existing model leveraging best-in-class agents, to further support restaurant operations. The cost-efficient innovation will enable select operators the potential to increase their sales by answering all calls and pursuing incremental revenue opportunities, while providing an excellent end-to-end customer experience.

    “Customers expect more from restaurateurs, and in return, restaurateurs expect even more technology-forward solutions from us – including support for phone channels to meet customers where they’re ordering,” said Rajat Shroff, Head of Product and Design at DoorDash. “Supporting operators by capturing customer demand through investments in our voice product is one way we’re delivering more and enabling our partners to grow their business.”

    According to our newly-released 2023 Restaurant Online Ordering Trends Report, one in five customers prefer to order takeout via phone – and according to qualitative DoorDash research, this preference stems from wanting convenience, customization, and familiarity. Despite the preference, with continued staffing issues, fluctuations in customer demand, and an emphasis on in-store hospitality, operators may be leaving revenue on the line.

    DoorDash listened to feedback from restaurant partners and customer preferences to incorporate AI into our voice ordering product that could further increase the variable profits of operator’s businesses without sacrificing quality.

    • Facilitating Cost-Effective Incremental Sales: From conversations with operators, DoorDash has heard that up to 50% of customer calls are left unanswered. Coupling AI with best-in-class live agents ensures customer calls will be answered with little to no wait, enabling operators to capture the unmet customer demand. By leveraging technology and DoorDash’s extensive menu knowledge, customers will be provided with curated recommendations to complement their meal, increasing overall ticket sizes by targeted upselling.
    • Relieving Burdensome In-Store Labor: During peak times at restaurants, AI will answer calls allowing employees to focus on providing warm hospitality to in-store customers as opposed to worrying about answering phone lines.
    • Providing Excellent Customer Experiences: Customers will have a personalized voice ordering experience in multiple languages with no missed calls or long wait times. Returning customers will be able to quickly reorder their favorite meal. Live agents will be available to jump in to support customers at any time.
    • Simple Merchant Onboarding: As a restaurant technology company, DoorDash maintains a vast network of middleware and point of sale integrations which allows a seamless and easy onboarding experience.

    Restaurants looking to facilitate delivery of phone orders are also able to tap into DoorDash Drive, a white-label solution that powers direct delivery from any business. This provides an intuitive, end-to-end experience for customers who wish to track their order’s progress.

    As DoorDash further develops its voice ordering product and builds high-quality, scalable solutions, restaurateurs are encouraged to follow get.doordash.com for further updates.

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    Captain AI Secures $2.1 Million Seed Round, Amid Accelerated Growth in North America

    Captain AI, a delivery logistics startup, has secured $2.1 million in seed funding, to further streamline in-house delivery operations for restaurants through AI-driven software solutions.

    The funding, led by firm GreenSky Ventures, will advance the company’s product offerings, establish a dedicated growth team and assist in meeting increasing market demand in the U.S. and Canada.

    “We are thrilled to secure this funding, as our continued aim is to put more power in the hands of restaurants,” said Ryan Perera, CEO of Captain AI. “Our comprehensive suite of dispatch and kitchen software is designed specifically around the unique pains and needs of restaurants to enhance delivery speed, optimize kitchen workflows, and ultimately improve the experience for both restaurants and their customers.”

    At its core, Captain AI helps restaurants manage their in-house delivery as cost-effectively as possible. Its product suite comprises a kitchen display system (KDS) that prioritizes orders based on driver locations, a dispatch app with AI capabilities to streamline order assignment and a manager app to provide decision-making insights.

    Captain AI’s product suite includes a dispatch app, that provides live driver tracking, batching and assignment of delivery orders and more.

    The company processes over 500,000 deliveries a month globally, serving brands such as Pizza Pizza, Canada’s largest pizza chain that has over 730 locations. According to the pizza hub, Captain’s logistics system has improved customer experience through the onset of nationwide live order tracking.

    Additionally, the software company has formed strategic partnerships with point-of-sale providers such as Revel Systems and SpotOn, expanding the availability of its software to a wider pool of restaurant owners.

    Managing hybrid delivery

    However, understanding that not all restaurants have the capacity for in-house drivers, the company is also introducing Fleetshare, a system enabling restaurants to offer and manage hybrid delivery.

    Fleetshare connects restaurants to a network of local delivery fleets, such as Uber Direct or DoorDash Drive, which offer white-label solutions for merchants to add on-demand delivery to their own website, app or other sales channels.

    “With this funding, our goal is to establish Captain AI as the industry leader and demonstrate the return on investment our technology can bring to restaurants,” said Perera. “We are excited to collaborate with GreenSky Ventures as we embark on the next phase of our mission to help restaurants thrive in the new era of in-house and hybrid delivery.”

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    ‘Uber For Food’: How 5 Friends From UC Berkeley Built Caviar, a $400 Million Company

    Caviar, a food delivery company, was launched by five friends from the University of California, Berkeley in 2012, at a time when no other food delivery app existed. Its founder, Shawn Tsao, along with his best friends took the company to a $410 valuation when they sold it to rival DoorDash, per CNBC.

    How Was Caviar Conceived?

    Tsao majored in architecture and sustainable design at Berkeley and worked side-by-side with four of his best friends, Abel Lin, Andy Zhang, Richard Din and Jason Wang, who all became co-founders of Caviar. They initially came up with the idea of a daily deals app for food similar to Groupon. They named the company “Munch on Me” and went on to earn a slot at start-up accelerator Y Combinator generating a $180,000 in investment money. However, when Groupon started posting losses with its market value dropping more than 80%, Munch on Me started losing investors too.

    As per the CNBC Make It report, Tsao had only $10 in the bank. However, they continued to stick with the idea of creating a successful start-up and explored more options. They sold Munch on Me’s data for “barely anything” and got to scribbling new ideas together. In the process, Tsao got “really hungry” and wished he could get his favorite sandwich at his doorstep from a restaurant across town. It was then that the friends came up with the idea to build an “Uber For Food”, as per the report. They launched Caviar in 2012 with a specialized model.

    Their service focused on curating a list of most desirable restaurants and provide its own fleet of delivery drivers to pick up food and drop it off with customers.

    At the time, not many food delivery apps existed. GrubHub and Seamless were there, and Postmates launched at the same time as Caviar. Food delivery giant DoorDash started a year later.

    Tsao’s took the role of “operations lead” and worked on building partnerships with popular restaurants. By onboarding popular restaurants on their platform, they generated a lot of indirect buzz without spending anything on marketing. People would talk about how popular restaurants were now delivering food and end up on the Caviar platform. With this, Caviar just blew up, Tsao said in the report.

    Caviar’s Acquisition

    As the company racked up investments from high profile investors such as the Winklevoss twins, Andreessen Horowitz and Tiger Global Management, Cavair gained attention of the top tech companies and associates. They soon got a “nine-figure acquisition offer,” from Jack Dorsey’s payments platform Square (now known as Block) in 2014. The all-stock deal valued the company at over $100 million.

    They accepted the deal and bagged stock in the combined company as well. They also got a $2 million cash sign-on bonus to be split between the founders. Five years later, Square sold Caviar to DoorDash for a whopping $410 million. The Caviar co-founders did not disclose how much they made from the company’s sale. However, the five founders owned more than 50% of the company at the time of its sale to Square. Although Tsao did reveal to CNBC that they weren’t involved in the sale to DoorDash.

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    Waitr: Q3 Earnings Snapshot

    Waitr Holdings Inc. (ASAP) on Monday reported a loss of $5.2 million in its third quarter.

    On a per-share basis, the Lafayette, Louisiana-based company said it had a loss of 38 cents.

    The food delivery app company posted revenue of $11.5 million in the period.

    In the final minutes of trading on Monday, the company’s shares hit 7 cents. A year ago, they were trading at $2.49.

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