3 ms·

Many things look similar from a 1000 miles away. At the actual business level, Uber and DoorDash are different in almost every way. This is one advantage that i

by paul 12y ago

Many things look similar from a 1000 miles away. At the actual business level, Uber and DoorDash are different in almost every way. This is one advantage that investors close to these companies have, and one reason why it can be so hard to understand any of this just by reading blog posts. DoorDash has a great business, in many ways better than Uber's.

downandout 12y ago
Whether carrying passengers or food, they are both in the delivery business. The primary difference is that one is worth $40 billion and one is not. Doordash may have some restaurant relationships that Uber doesn't, but that is ground that can be quickly made up with money. These VC's are merely hedging their bets with this investment.
- paul 12y ago
  In that case you should assume that FedEx will put them all out of business. There's a lot more going on than "delivery".
  - downandout 12y ago
    I wouldn't assume that. Fedex has many constraints on its business, and shares almost no core competencies with DoorDash or Uber. Its fleet consists not of nimble passenger cars, but of large, fuel guzzling trucks - making one-to-one pickups and deliveries inefficient and unprofitable. It also has no expertise in the area of recruiting independent contractors to perform work for it, which is one of the core competencies of both DoorDash and Uber. I wouldn't turn to DoorDash to deliver live lobsters to me from Maine overnight, and I wouldn't turn to Fedex to get me food from down the street. Those are very different businesses requiring very different infrastructures. Therein lies the problem for DoorDash: they are not that different from Uber. They have similar core competencies, but Uber is vastly better known and financed.
    - paul 12y ago
      Time will tell :)
    - khc 12y ago
      didn't all the Fedex drivers start out as contractors, until a court case ruled that they are actually employees? Time will tell if this will happen to DoorDash and Uber.
    - toomuchtodo 12y ago
      I feel like your post highlights one of the glaring problems with the SV/SFBA echo chamber. Uber, DoorDash, whatever, they're services glued together with server-side logic and mobile apps. Fedex, UPS, and I'll even lump Amazon in there. These are logistics powerhouses. Their physical world equipment isn't a liability, its their advantage. Fedex and UPS have knowledge on how to manage a fleet of hundreds of aircraft, thousands of long-haul tractor trailers, tens of thousands of local delivery trucks, and hundreds of thousands of employees. Your app does not have that. You have users. You have VC money. And while you might think you're more agile than logistics dinosaurs, they have the upper hand. Good luck.
7Figures2Commas 12y ago
> DoorDash has a great business, in many ways better than Uber's. Have you considered what happens to that business if DoorDash is forced to reclassify its workers as employees? A delivery business is particularly sensitive to classification because of all the expenses that drivers incur, namely those associated with the use of their vehicles. Do a Google search for "delivery driver class action" and look at the Glassdoor reviews for some of the companies in the space, this one included. Instacart has already been sued and it's only a matter of time before all of the major players are forced to defend their models in court too. You don't just get a free pass because you build an app, raise a bunch of money from VCs on Sand Hill Road and try to position a basic delivery service as a technology-based communication platform.

by paul 12y ago

downandout 12y ago

Whether carrying passengers or food, they are both in the delivery business. The primary difference is that one is worth $40 billion and one is not. Doordash may have some restaurant relationships that Uber doesn't, but that is ground that can be quickly made up with money. These VC's are merely hedging their bets with this investment.

paul 12y ago
In that case you should assume that FedEx will put them all out of business. There's a lot more going on than "delivery".
- downandout 12y ago
  I wouldn't assume that. Fedex has many constraints on its business, and shares almost no core competencies with DoorDash or Uber. Its fleet consists not of nimble passenger cars, but of large, fuel guzzling trucks - making one-to-one pickups and deliveries inefficient and unprofitable. It also has no expertise in the area of recruiting independent contractors to perform work for it, which is one of the core competencies of both DoorDash and Uber. I wouldn't turn to DoorDash to deliver live lobsters to me from Maine overnight, and I wouldn't turn to Fedex to get me food from down the street. Those are very different businesses requiring very different infrastructures. Therein lies the problem for DoorDash: they are not that different from Uber. They have similar core competencies, but Uber is vastly better known and financed.
  - paul 12y ago
    Time will tell :)
  - khc 12y ago
    didn't all the Fedex drivers start out as contractors, until a court case ruled that they are actually employees? Time will tell if this will happen to DoorDash and Uber.
  - toomuchtodo 12y ago
    I feel like your post highlights one of the glaring problems with the SV/SFBA echo chamber. Uber, DoorDash, whatever, they're services glued together with server-side logic and mobile apps. Fedex, UPS, and I'll even lump Amazon in there. These are logistics powerhouses. Their physical world equipment isn't a liability, its their advantage. Fedex and UPS have knowledge on how to manage a fleet of hundreds of aircraft, thousands of long-haul tractor trailers, tens of thousands of local delivery trucks, and hundreds of thousands of employees. Your app does not have that. You have users. You have VC money. And while you might think you're more agile than logistics dinosaurs, they have the upper hand. Good luck.

7Figures2Commas 12y ago

> DoorDash has a great business, in many ways better than Uber's. Have you considered what happens to that business if DoorDash is forced to reclassify its workers as employees? A delivery business is particularly sensitive to classification because of all the expenses that drivers incur, namely those associated with the use of their vehicles. Do a Google search for "delivery driver class action" and look at the Glassdoor reviews for some of the companies in the space, this one included. Instacart has already been sued and it's only a matter of time before all of the major players are forced to defend their models in court too. You don't just get a free pass because you build an app, raise a bunch of money from VCs on Sand Hill Road and try to position a basic delivery service as a technology-based communication platform.