Home News How COVID-19 accelerated DoorDash’s enterprise – TechCrunch

How COVID-19 accelerated DoorDash’s enterprise – TechCrunch


DoorDash filed to go public as we speak, publishing numbers that showed rapid growth, enhanced profitability and an enhancing money move file which helped clarify how the corporate had grown to a $16 billion valuation whereas non-public. The unicorn’s impending liquidity occasion will enrich a host of venture capital firms that guess on its eventual maturity.

As an alternative of posting this entry of The Exchange on Monday, we’ve put it out as we speak on your Friday and weekend studying. Get pleasure from! — Alex and Walter

However notable in DoorDash’s spectacular outcomes is the influence of COVID-19, accelerating secular tendencies already in place, and boosting the unicorn’s progress. Earlier than we get into pricing this IPO and guessing what the corporate may be value, let’s attempt to know what portion of its 2020 enterprise good points may stem from the pandemic — and won’t persist into the longer term.

We’re not being pessimistic; we merely need to higher perceive the corporate. And DoorDash agrees with our normal thrust, writing in its S-1 submitting that “58% of all adults and 70% of millennials say that they’re extra more likely to have restaurant meals delivered than they have been two years in the past,” including that it believes “the COVID-19 pandemic has additional accelerated these tendencies.”

Much more, elsewhere in its filings DoorDash states plainly that COVD-19 led it to expertise “a big enhance in income, Whole Orders, and Market [gross order volume] on account of elevated client demand for supply, extra retailers utilizing our platform to facilitate each supply and take-out, and improved effectivity of our native logistics platform.” The corporate then went on to warn buyers that the “circumstances which have accelerated the expansion of our enterprise stemming from the consequences of the COVID-19 pandemic could not proceed sooner or later, and we anticipate the expansion charges in income, Whole Orders, and Market [gross order volume] to say no in future durations.”

We’re not idly speculating.

Let’s observe how DoorDash’s progress accelerated from 2019 by 2020 after which peek at how the corporate’s economics improved throughout the identical interval, giving the corporate a shot at adjusted profitability for the total yr, an almost extraordinary outcome within the on-demand market.


DoorDash generates income when a buyer orders meals through its service, splitting the entire invoice of meals prices, taxes, charges and ideas, distributing them to itself, the service provider creating the products and the supply individual.

In an “illustrative” instance that DoorDash notes its 2019 “approximate common per-order info,” the cut up works out as follows:

  • Invoice: $32.90
  • Service provider: $20.10, or 61%
  • DoorDash: $4.90, or 15%
  • Supply individual: $7.90, or 24%

On condition that the corporate is giving us previous information and DoorDash’s efficiency has been stellar this yr by way of producing extra gross revenue, I ponder what has occurred amidst 2020’s upheaval. However, the previous numbers do for what we’d like, which is to know the hyperlink between gross order quantity (GOV) and DoorDash income. When the previous goes up, the latter goes up.

So, as orders rise: