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Third-Party Delivery for Restaurants will Cease to Exist as We Know it.

This Music Will Stop. I realize this puts me outside conventional wisdom, but I do NOT believe that the third-party delivery model, as we know it, is sustainable. Here is why: 

The third-party delivery providers don’t seem close to profitability. GrubHub took its perfectly good business model and messed the bed getting into delivery. Uber lost $8.5B last year, and its head of UberEats stepped down yesterday. The Postmates IPO is not looking good post-WeWork. DoorDash is burning huge sums to buy shares and making tons of enemies. As of today, they have begun the process of going public and obviously in need of capital to fuel the burn. (It will be good to see under the hood on their economics when their S-1 comes out.) Surely, we would expect to see this group consolidate to one or two players, but will volume even matter? … click here to continue reading   


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