Exactly. The reason UPS and FedEx ceded last mile mail and package delivery to the USPS is that they weren't interested in dealing with the complex logistics of

Exactly. The reason UPS and FedEx ceded last mile mail and package delivery to the USPS is that they weren't interested in dealing with the complex logistics of last mile delivery. Its unpredictable and unprofitable. They are interested in the meaty part of mail delivery: charging customers $20 to carry an envelope across the country on a plane, which has a marginal cost approaching zero for them. Time will tell, but my theory on these last mile businesses that are springing up is that they are cramming into the market at precisely the places where there is the least money to be made, but offers the most convenience to customers. In other words, VC's are subsidizing luxuries that customers themselves have shown they won't pay for. This would be a great business if customers were willing to pay $20 to have food delivered, but the truth is that they aren't. At that point they will look for businesses that have delivery baked into the business model (ie, Dominos), or just go pick it up themselves. There seems to be an inherent assumption somewhere that these businesses that don't offer delivery are out of touch or not tech-savvy, but the article touched on an important point with this quote: “There were many pages of orders, not just one or two,” he says. Finally, when spotting this phenomenon at a Palo Alto macaroon store on day, Xu asked why these orders weren’t being delivered. The answer was that the owner has opened his bakery to bake, and not deliver stuff. He got similar answers from people in other businesses, ranging from toys to furniture, to restaurants. Maybe those businesses aren't interested in delivery for a reason. Just because you can build software for a smartphone doesn't mean the fundamental laws of P&L don't apply.