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In the age of deeply unprofitable (as in, they lose more money than they grossed in revenue) tech companies going public, DoorDash actually seems pretty okay.

In the age of deeply unprofitable (as in, they lose more money than they grossed in revenue) tech companies going public, DoorDash actually seems pretty okay. In the 9 months ended 2020-09-30, DoorDash had a net loss of $149 million on $1,916 million in revenue (see page 93). Which implies if they can raise their revenue by ~7.78% while keeping costs steady, they can break even. Given their rate of revenue/cost increases (in the same timeframe as above compared to the 9 months ended 2019-09-30, revenue grew 326% while costs grew 192%), they could very plausibly do so within the next year.

nipponese 6y ago
Hats off to you for actually reading the S-1 and not just coming to this thread to drop an opinion about the industry or VCs.
kmonsen 6y ago
In a pandemic where people can’t eat out.
- raziel2701 6y ago
  Yeah there's no better time to go public than now for doordash. The pandemic has boosted their revenue and I suspect it will never reach these all time highs (which is still not enough for them to make profit). So go public and let retail investors hold the bag.
- ghaff 6y ago
  Yeah, the numbers are not terrible given other companies in a similar vein. However, as you say, we're in circumstances where a lot of people want prepared food but don't want to go out and pick it up. Or, at least, can mentally justify spending money they wouldn't normally spend given the current circumstances.
- Jeremy1026 6y ago
  Yes, but humans are creatures of habit. Now that we are used to all of our food showing up to our house, I don't expect that many people, especially those that are past the 'lets go out with our friends 3 days a week' stage of their life will continue to order in more than they go out once restrictions lift around the country.
  - RussianCow 6y ago
    This doesn't line up with what I'm seeing locally at all. Almost immediately after restaurants were allowed to have dine-in customers, I started to see them packed any time I came to pick up food. Obviously there still aren't as many people dining out as before the pandemic, but most people I know couldn't wait to start going out on a regular basis again. With that said, I do think food delivery and pickup will be more popular in general after the pandemic, but I highly doubt it will ever be as commonly done as it is now. For the record, I'm in the US; I can't speak for other countries. Notably, I was in London about a year and a half ago, takeaway and delivery already seemed to be extremely commons way to dine.
    - Jeremy1026 6y ago
      I'd be those people just needed to get out of the house. But over the long run will revert back to their new normal of ordering in.
      - RussianCow 6y ago
        I don't think so. We're not talking about a week-long or even month-long surge that's starting to fade; it's been like this since the dine-in ban was lifted in early summer, and has only gotten worse now that the weather has turned. If this generalizes to the rest of the country (which is obviously not a given, but I think rather likely), we'll be back to pre-pandemic levels of dining as soon as restrictions are lifted. Also, delivery is only a replacement for dining out if your reason for going out is the food/drink. If, on the other hand, you dine out for the social aspect, then delivery is never going to be a replacement for you. My hunch tells me that the latter is more common, but I'm not as confident in that prediction.
rpcwork 6y ago
Nobody showed them more love than I did. Just because it felt like such a fun way to get food while still supporting the gig-workers. Until, I started noticing the huge markup on sides/entrees that I recall costing way less on the restaurant menu. Did prices go up? Nope, it was doordash. A side of garlic sauteed edamame is $4.75 on the restaurant menu, but $7.85 on the delivery app. $7.85 isn’t too much for a good tasting side, but I am not a fan of being lied to about pricing. Felt like getting ripped off. It obliterates my trust in today’s delivery apps and damages the value proposition. One wonders: How much of the revenue is coming from markup in menu prices? What happens to this revenue when the average consumer grows wise to these markups? Re: https://www.forbes.com/sites/suzannerowankelleher/2020/02/27/meal-delivery-apps-can-charge-markups-as-high-as-91/ https://www.forbes.com/sites/suzannerowankelleher/2020/02/27...
- tomashertus 6y ago
  I just noticed it this weekend. Side of egg rolls on Doordash is $10, additional egg roll $2. On menu $6.50 and additional egg roll $1. When I noticed that, I immediately removed the order and called the restaurant directly. The markups for ordering through doordash are ridiculous. I can afford to pay $25 for a burrito, but I'm not going to do that. That's a ridiculous price for being lazy/greedy.
  - randycupertino 6y ago
    $12 for some egg rolls is just way too much!! Oof.
    - arcticbull 6y ago
      My first thought was that's like Monster Cable margins. On the other hand... the materials cost of an egg roll in quantity 10 is $0.51 based no some research I just did. In general a restaurant should expect to price a menu item at 4X food cost, so right around the $2.00 mark.
      - porknubbins 6y ago
tchalla 6y ago
p129 > On a quarterly basis, our revenue increased for all quarters presented as a result of increases in Total Orders. The increase in Total Orders was primarily driven by an increase in new consumers acquired as a result of our continued expansion in our existing markets and expansion into new markets, increased engagement from existing consumers, and growth in orders completed through Drive. In the second and third quarters of 2020, these trends accelerated in part due to the effects of the COVID-19 pandemic, which resulted in in-store dining shutdowns and the adoption of shelter-in-place measures. The pandemic has helped DoorDash. There's an increase of revenue from $362M 31.03.2020 to $879M 30.09.2020 (p128). This has also led to an increase in Working Capital $1156M at 30.09.20 from $616M (31.12.2019).
inkaudio 6y ago
If the pandemic continues for another 9 months probably if not things are going to get worse, because people are going to go out a lot more when the pandemic is over and order delivery’s much less.
lenitabinol 6y ago
My toothbrush breaks even but its not worth $25B

nipponese 6y ago

Hats off to you for actually reading the S-1 and not just coming to this thread to drop an opinion about the industry or VCs.

kmonsen 6y ago

In a pandemic where people can’t eat out.

raziel2701 6y ago
Yeah there's no better time to go public than now for doordash. The pandemic has boosted their revenue and I suspect it will never reach these all time highs (which is still not enough for them to make profit). So go public and let retail investors hold the bag.
ghaff 6y ago
Yeah, the numbers are not terrible given other companies in a similar vein. However, as you say, we're in circumstances where a lot of people want prepared food but don't want to go out and pick it up. Or, at least, can mentally justify spending money they wouldn't normally spend given the current circumstances.
Jeremy1026 6y ago
Yes, but humans are creatures of habit. Now that we are used to all of our food showing up to our house, I don't expect that many people, especially those that are past the 'lets go out with our friends 3 days a week' stage of their life will continue to order in more than they go out once restrictions lift around the country.
- RussianCow 6y ago
  This doesn't line up with what I'm seeing locally at all. Almost immediately after restaurants were allowed to have dine-in customers, I started to see them packed any time I came to pick up food. Obviously there still aren't as many people dining out as before the pandemic, but most people I know couldn't wait to start going out on a regular basis again. With that said, I do think food delivery and pickup will be more popular in general after the pandemic, but I highly doubt it will ever be as commonly done as it is now. For the record, I'm in the US; I can't speak for other countries. Notably, I was in London about a year and a half ago, takeaway and delivery already seemed to be extremely commons way to dine.
  - Jeremy1026 6y ago
    I'd be those people just needed to get out of the house. But over the long run will revert back to their new normal of ordering in.
    - RussianCow 6y ago
      I don't think so. We're not talking about a week-long or even month-long surge that's starting to fade; it's been like this since the dine-in ban was lifted in early summer, and has only gotten worse now that the weather has turned. If this generalizes to the rest of the country (which is obviously not a given, but I think rather likely), we'll be back to pre-pandemic levels of dining as soon as restrictions are lifted. Also, delivery is only a replacement for dining out if your reason for going out is the food/drink. If, on the other hand, you dine out for the social aspect, then delivery is never going to be a replacement for you. My hunch tells me that the latter is more common, but I'm not as confident in that prediction.

rpcwork 6y ago

Nobody showed them more love than I did. Just because it felt like such a fun way to get food while still supporting the gig-workers. Until, I started noticing the huge markup on sides/entrees that I recall costing way less on the restaurant menu. Did prices go up? Nope, it was doordash. A side of garlic sauteed edamame is $4.75 on the restaurant menu, but $7.85 on the delivery app. $7.85 isn’t too much for a good tasting side, but I am not a fan of being lied to about pricing. Felt like getting ripped off. It obliterates my trust in today’s delivery apps and damages the value proposition. One wonders: How much of the revenue is coming from markup in menu prices? What happens to this revenue when the average consumer grows wise to these markups? Re: https://www.forbes.com/sites/suzannerowankelleher/2020/02/27/meal-delivery-apps-can-charge-markups-as-high-as-91/ https://www.forbes.com/sites/suzannerowankelleher/2020/02/27...

tomashertus 6y ago
I just noticed it this weekend. Side of egg rolls on Doordash is $10, additional egg roll $2. On menu $6.50 and additional egg roll $1. When I noticed that, I immediately removed the order and called the restaurant directly. The markups for ordering through doordash are ridiculous. I can afford to pay $25 for a burrito, but I'm not going to do that. That's a ridiculous price for being lazy/greedy.
- randycupertino 6y ago
  $12 for some egg rolls is just way too much!! Oof.
  - arcticbull 6y ago
    My first thought was that's like Monster Cable margins. On the other hand... the materials cost of an egg roll in quantity 10 is $0.51 based no some research I just did. In general a restaurant should expect to price a menu item at 4X food cost, so right around the $2.00 mark.
    - porknubbins 6y ago

tchalla 6y ago

p129 > On a quarterly basis, our revenue increased for all quarters presented as a result of increases in Total Orders. The increase in Total Orders was primarily driven by an increase in new consumers acquired as a result of our continued expansion in our existing markets and expansion into new markets, increased engagement from existing consumers, and growth in orders completed through Drive. In the second and third quarters of 2020, these trends accelerated in part due to the effects of the COVID-19 pandemic, which resulted in in-store dining shutdowns and the adoption of shelter-in-place measures. The pandemic has helped DoorDash. There's an increase of revenue from $362M 31.03.2020 to $879M 30.09.2020 (p128). This has also led to an increase in Working Capital $1156M at 30.09.20 from $616M (31.12.2019).

inkaudio 6y ago

If the pandemic continues for another 9 months probably if not things are going to get worse, because people are going to go out a lot more when the pandemic is over and order delivery’s much less.

lenitabinol 6y ago

My toothbrush breaks even but its not worth $25B