Food delivery startups – a quick analysis

Yesterday I discovered an Indian startup filed to go public on its national stock exchange. I did not know it, shame on me. Zomato is the latest filing in a small number but extremely visible services in the food delivery sector. Who does not know Deliveroo, Just Eat, Uber Eats and others.

I am not sure that twenty years ago I would have pu the sector in technology innovation, but I have to admit innovation has many faces. On Crunchbase, the sector is said to have 616 organizations with $12.5B in funding (see Crunchbase Food Delivery Startups). Traxn gives the largest players here. So thanks to my database of 777 cap. tables, I could have a look at some statistics, with the exception of FoodPanda (acquired by Delivery Hero, funded with $318M including Rocket Internet), iFood (Brazil, owned by Movile, $587M in funding) and Swiggy (India, $2.5B in funding including Accel). Here are the data at time of the IPO filings.

Start-up JustEat GrubHub Zomato Delivery Hero Deliveroo DoorDash Median *
Geography United Kingdom Illinois India Germany United Kingdom Silicon Valley
Founded Aug-01 Feb-04 Jan-10 May-11 Aug-12 May-13 Sep-02
IPO / exit Apr-14 Apr-14 Apr-21 Jun-17 Mar-21 Nov-20 Mar-13
Years to IPO 12,7 10,2 11,3 6,1 8,6 7,5 7,4
VC Amount 88 86 1529 1711 1856 2578 84
1st round 8 1 1 4 4 2 4,4
Sales ($M) 150 137 338 297 1 680 885 23
Income ($M) 10 15 -310 -202 -312 -668 -14
Market Cap. 1 465 1 988 6 782 4 700 10 220 17 384 560
PS 10 15 20 16 6 20 17
PE 147 133 102
Nb of Emp. 886 680 3 469 12 098 2 561 3 279 189

*: the median value is based on 777 startups compiled over years. PS and PE are the ratios of market caps to sales and earnings (profit)

Just Eat has no data on founders as the initial Danish company with 5 founders has been bought and moved/launched in the UK.

Here are the data to date (GrubHub has been acquired by Just Eat in 2020):

Market Cap. $B Sales – $B Loss – $M PS Employees
Just Eat 15,4 2,8 -151 5,4 9 000
Delivery Hero 39,4 2,0 -939 19,5 35 528
DoorDash 46,0 2,9 -458 15,9 3 886
Deliveroo 6,3 1,6 -225 3,9 2 060
Zomato 6,8 0,3 -310 20,1 3 469

What is interesting is the difference in dynamics between companies launched before 2010. Something not really new if you follow this blog, in terms of growth dynammics. Here are some more data about shareholders

Start-up JustEat GrubHub Zomato Delivery Hero Deliveroo DoorDash Median *
Found. 5,7% 6,2% 4,5% 7,1% 12,0% 9%
Emp. 9,4% 25,1% 7,0% 17,2% 18,9% 18,5% 21%
Emp. shares 9,3% 12,1% 3,1% 11,7% 9,4% 4,8% 8%
ESOP-granted 0,1% 9,7% 0,6% 5,5% 9,5% 11,8% 8%
ESOP-reserved 3,3% 3,3% 1,9% 5%
Dir. 0,2% 0,06% 0%
CEO 1,0% 3%
VP 0,2% 1,1% 0,2% 0,2% 0,8% 1%
CFO 0,2% 0,3% 0,2% 1%
Investors 66,0% 59,3% 70,2% 59,9% 74,0% 68,7% 51%
IPO 24,6% 9,7% 16,6% 18,4% 0,6% 16%
Total 100% 100% 100% 100% 100% 100% 100%
Nb of Dir. 2 2 2
Dir % 0,1% 0,03% 0,2%
Nb of found. 2 4 3 2 3 2
Found. % 2,9% 1,6% 1,5% 3,6% 4,0% 4,5%
Found. age 27 31 31 33 23 37,6
F1 28 27 31 33 29
F2 26 29 33 21
F3 31 20
F4 38

The founders are young, own little. How teh sector will develop, I do not know. There is already concentration. Barriers to entry look low. Some experts have doubt about long term profitability… tough to say. Deliveroo shows no IPO shares as the initial filing did not include any new shares. It may have changed at the recent IPO which was not a success; and here are the individual cap. tables.

Leave a Reply

Your email address will not be published.

Time limit is exhausted. Please reload CAPTCHA.

This site uses Akismet to reduce spam. Learn how your comment data is processed.