Latest news with #DoorDash
New York Times
a day ago
- Business
- New York Times
The Business Interests Bankrolling Andrew Cuomo's Run for Mayor
A quarter-million dollars came from the head of Suffolk Construction, a Boston-based builder betting big on a New York City expansion. Another $150,000 arrived from the chairman of Vornado Realty Trust, who is searching for a way to revive a stalled Midtown Manhattan redevelopment so important that he once called it his 'promised land.' DoorDash, the food delivery service lobbying City Hall on regulations that could disrupt its business model, chipped in a staggering $1 million. The donations make up just a fraction of the checks from New York business leaders, billionaires and special interest groups pouring into a super PAC boosting Andrew M. Cuomo, the favorite in the Democratic primary for mayor on June 24. With $10 million raised so far, the super PAC, Fix the City, is already the single largest outside spending force in New York City's political history, surpassing a record set in 2021. It has spent multiples more on ads than any campaign in the race, blanketing New Yorkers' screens in paeans to the former governor. The next biggest candidate super PAC, set up to back Assemblyman Zohran Mamdani, a democratic socialist who is second in recent polls, has 1/50th of the funds. Want all of The Times? Subscribe.
CNBC
2 days ago
- Business
- CNBC
Under-the-radar delivery apps are gaining ground in the U.S. by courting Asian restaurants
NEW YORK – When Kelly Wu feels sick and wants a delivery of congee, the Chinese porridge she grew up eating, she opts for a platform many may not have heard of. The New York City resident doesn't open apps from multi-billion dollar companies like Uber Eats or DoorDash. Instead, the 22-year-old pulls up Fantuan, a growing Vancouver-based startup that focuses specifically on the ecosystem surrounding Asian cuisines. "I feel like it's just the equivalent of 'Asian' DoorDash or Uber Eats," Wu said in an interview with CNBC. Digital food ordering and delivery platforms have become ingrained in everyday American life over the past decade, with companies like Uber Eats, DoorDash and GrubHub becoming household names. But when it comes to Asian food, connoisseurs like Wu and restaurant owners are opting for smaller platforms like Fantuan or competitor HungryPanda. Fantuan's strategy looks different than that of bigger food platforms given its focus on Asian businesses, according to co-founder Yaofei Feng. The 11-year-old company sends representatives to talk to store owners in person about getting on the platform rather than trying to reach them online, Feng said. These conversations will often take place in Chinese, given that he said many of these entrepreneurs speak English as a second language. "The way we gain their trust is very unique," Feng said. Having options besides English for the app is appealing for business owners who find it easier to communicate in their first language. The app design is also more reminiscent of Chinese platforms like Alibaba than American alternatives, Feng said, which can provide a sense of familiarity. Since Fantuan first entered the U.S. in 2019, Feng said it has expanded to more than 50 cities ranging from large metropolises such as Los Angeles to college towns like Davis, Calif. The company's U.S. footprint was boosted by its acquisition of Chowbus' delivery business last year. Rather than run large advertising campaigns, Fantuan mainly spreads the word through providing sign holders at storefronts and stickers for delivery drivers. The startup has also worked with influencers on platforms like TikTok and RedNote, a popular short-form video app in China. Feng said Fantuan's main customer bases are first-generation immigrants and international students craving authentic cuisines tied to their home countries. He said the company meets with college student associations to find potential customers coming to the U.S. from Asia. But Feng said there's potential for the app to reach a wider audience as foods including bubble tea become mainstream in the U.S. The company said it saw a growth rate for gross merchandise value of more than 20% in the U.S. last year, before shooting up to 31% in the first quarter of 2025. "With the immigration and the social media, everybody loves Asian food," Feng said. "If they want authentic options, they will also use the app." Following the Chowbus acquisition, many business owners and users consider HungryPanda as the main competitor to Fantuan. Wu said she also has HungryPanda's app, but hasn't ordered on it since she first began using Fantuan, and has been pleased with the service. HungryPanda did not respond to CNBC's interview inquiry for this story. HungryPanda announced last year that it raised $55 million, which will be used in part to fuel expansion efforts in North America. When it comes to the broader food delivery app landscape, Feng said he sees the company "co-existing" alongside bigger-name companies rather than "competing." That's because the draw of Fantuan is connecting authentic – and often smaller – businesses to customers instead of trying to win over large chains that already use other platforms. "It's very hard ... long-term, to compete with the monopolies," he said. "But we want to keep our unique way." In Flushing, a neighborhood of New York City's Queens borough known for its large population of Chinese-Americans, Andrew Chau sees first-hand how the customer base has taken to Fantuan. Chau said his outpost of Yomie's Rice x Yogurt sees around 50 orders each day on the platform. By comparison, Chau said he's lucky to get one order every few days on apps like Uber Eats or DoorDash. Chau likes that the app offers users promotions and that he can communicate with customer service through WeChat, a popular messaging platform in China. He also said many restaurants nearby use the platform, as evidenced by companies having Fantuan logos around their businesses. In Flushing, "I can see lots of Fantuan logo[s]," said Chau, who owns five stores in the New York City area. "I cannot see lots of Uber Eats or DoorDash." Wu also said she sees the logo regularly around areas with high rates of Asian businesses like Flushing or Manhattan's well-known Chinatown neighborhood. She's also seen the delivery drivers out wearing merchandise for both Fantuan and HungryPanda. For Wu, the authenticity of restaurants on Fantuan is better than other more prominent food delivery platforms. She also believes that reviews on Fantuan to be more trustworthy. "I can find dishes that I can't find on American food ordering apps," Wu said. "I feel like it's definitely the way to go if I'm looking for a traditional Chinese meal, rather than using Uber Eats or DoorDash to get something like orange chicken."
CNBC
2 days ago
- Business
- CNBC
DoorDash CEO Tony Xu is taking on the role of industry consolidator in food delivery
During the depths of the Covid pandemic, with restaurants around the country facing an existential crisis, DoorDash CEO Tony Xu had an unconventional proposal. He wanted to cut commissions. Chief Business Officer Keith Yandell worried that such a move would result in a massive hit to profits ahead of the company's planned IPO. But Xu made a persuasive case. "If restaurants don't thrive, we cannot," Yandell told CNBC in a recent interview, recalling Xu's perspective at the time. "We need to take a leadership position." The company ended up sacrificing over $100 million in fees, Xu later said. Since starting DoorDash on the campus of Stanford University in 2013, the now 40-year-old CEO has navigated the notoriously cutthroat and low-margin business of food delivery, building a company that Wall Street today values at close to $90 billion. The stock has emerged as a tech darling this year, jumping 23%, while the Nasdaq is still down for the year largely on tariff concerns. More than four years after its IPO, net profits remain slim. But that's not getting in the way of Xu's mission to become an industry consolidator, using a combination of cash and new debt to fuel an acquisition spree at a time when big tech deals remain scarce. Earlier this month, DoorDash scooped up British food delivery startup Deliveroo for about $3.9 billion and restaurant technology company SevenRooms for $1.2 billion. "What we've delivered for a customer yesterday probably isn't good enough for what we will deliver for them today," Xu told CNBC's "Squawk Box" after the deals were announced. This week DoorDash announced the pricing of $2.5 billion in convertible debt, and said the proceeds could be used in part for acquisitions. The San Francisco-based company has a history with scooping up competitors to grow market share. In 2019, it bought food delivery competitor Caviar for $410 million from Square, now known as Block. About two years later, DoorDash said it was paying $8.1 billion for international delivery platform Wolt. The deal was its last big transaction until this month. When DoorDash entered the food delivery market, it had to face off against the likes of GrubHub and Seamless, which later joined forces. That combined entity was bought late last year by restaurant owner Wonder Group. In 2014, Uber launched Uber Eats, which is now DoorDash's biggest competitor in the U.S. "It's a very competitive market, and I think merchants do have choice," Xu said in the CNBC interview. "What we're focused on is always trying to innovate and bring new products to match increasing standards and expectations from customers." DoorDash didn't make Xu available for an interview for this story, but provided a statement about the company's acquisition strategy. "We're very picky, very patient, and conscious that, for most companies, deals don't work out in hindsight," the company said. "When we see an opportunity that brings value to customers, expands our potential to empower local economies around the world, and has a path to strong long-term returns on capital, we tend to push our chips in." DoorDash differentiated itself early on by cornering suburban markets that had fewer delivery options, while other players attacked city centers. When Covid shut down restaurant dining in early 2020, DoorDash capitalized on the booming demand for deliveries. Revenue more than tripled that year, and grew 69% in 2021. Colleagues and early investors credit a customer-first focus for much of Xu's success. Gokul Rajaram, who joined DoorDash through its Caviar acquisition, described Xu as "the best operational leader in the U.S." after Amazon founder Jeff Bezos. Restaurants haven't universally viewed DoorDash as an ally. Commissions can reach as high as 30%, which is a hefty cut to fork over. Many restaurants have reluctantly paid the high fees because of DoorDash's dominant market share, which reached an estimated 67%. In 2021, the company introduced three tiers of pricing, with a basic option at 15% for more price-sensitive businesses. DoorDash needs the high fees in order to stay in the black. The company's contribution profit as a percentage of total marketplace volume hovers below 5%. Colleagues who have known Xu for decades say the food delivery entrepreneur hasn't changed much since the early days of the company. Yandell said Xu once took advice from his young daughter, who complained about a routing issue while accompanying him on food delivery orders. All employees, including Xu, are required to complete orders and handle support calls every year as part of the company's WeDash program. In a part of the country known for the pomp of its wealthy founders, Xu has a very different reputation. Early workers recall memories of Xu pulling up in a dilapidated green 2001 Honda Accord to team events, or participating in company knockout basketball games referred to as "knockys," next to the animal hospital in Palo Alto, which DoorDash briefly called its headquarters. Xu also personally approved every offer for the company's first 4,000 employees. Xu spends many mornings answering customer service complaints. He often drops his kids off at school and, after tucking them in at night, hops on calls with international regions, colleagues say. Xu is an avid Gold State Warriors basketball fan but has a soft spot for the Chicago Bulls, having spent many years in Illinois. Once or twice a week, Xu squeezes in a morning run, and will often do so while traveling to explore different neighborhoods and stores. Xu was born in China and moved with his family to Champaign, Illinois, in 1989. Growing up, he played basketball and mowed lawns to save up for a Nintendo. He told Stanford's View From the Top podcast in 2021 that the experience, and watching his parents hustle, taught him how to "earn your way into better things." His "characteristics became the company's values," said Alfred Lin, an early DoorDash investor and partner at venture firm Sequoia. Xu often attributes his entrepreneurial spirit to his parents. His mother worked as a doctor in China, and juggled three jobs in the U.S. for over a decade, saving up enough to eventually open a medical clinic. His father worked as a waiter while pursuing a Ph.D. Xu said on the podcast that watching his mom gave him a deep understanding of what it takes to run a small business, which came in handy in DoorDash's early years as he was trying to convert restaurants into customers. Employees say Xu has a reputation for detecting hidden talents among his colleagues. Jessica Lachs, the company's chief analytics officer, was working as a general manager assisting with DoorDash's Los Angeles launch when Xu guided her toward her passion for data. "He believes in leaning into the things you're really good at, rather than trying to be mediocre at a lot of things," she said. After Toby Espinosa, DoorDash's ads vice president, lost a deal with a major fast food company during his early years at the startup, Xu told him to work "10 times harder" and become an expert in his field. A few years later, the company secured the partnership, Espinosa said. Grit and struggle defined the early years of DoorDash. The founding team of four managed deliveries around Stanford and Palo Alto though a Google Voice number directed to their cellphones. DoorDash emerged out of a Stanford business school course known as Startup Garage, taught by Professor Stefanos Zenios. The class requires students to present a business idea, test it, and then pitch it to investors. Zenios said Xu stood out with his data-driven approach and natural leadership qualities. The team tested two different ideas, including a platform that helped small businesses better track the effectiveness of their marketing, he recalls. Zenios called the idea to target suburban areas a "brilliant insight." Xu and his team entered Y Combinator in the summer of 2013. The three-month startup accelerator program is known for spawning companies like Airbnb, Stripe and Reddit. Every session culminates with a demo day in front of some of Silicon Valley's biggest investors. The DoorDash idea excited Paul Buchheit, creator of Gmail and a partner at Y Combinator. But like many other potential investors, Buchheit was skeptical about the economic model. "You had a talented team of founders working on what I thought was an idea that had potential," he said. "That's basically the formula for a good startup." On pitch day, the company failed to lure any venture firms, but Buchheit later participated as a seed investor. Shortly after demo day, DoorDash encountered Saar Gur of Charles River Ventures. Gur had been looking for a food delivery platform to back and was conducting due diligence on another company when a friend led him to DoorDash. By the end of their first meeting, they were "finishing each other's sentences," Gur said. Sequoia's Lin initially passed on DoorDash after the Y Combinator pitch, but kept in touch with the team. Lin said he wanted to see data that showed the platform could penetrate beyond Stanford and Palo Alto, and retain customers. He ended up leading two institutional rounds, attaining a 20% stake for Sequoia at the time of the IPO. "Tony always believed that his company would succeed, or they'll find a way to succeed," Lin said. Shortly after its Y Combinator stint, DoorDash hit an early roadblock. Following a Stanford football game, a rush of orders bombarded its delivery system causing massive delays, Xu told Y Combinator's CEO Garry Tan in an interview this year. The founders refunded the orders and spent the night baking cookies, then driving them to customers early the next morning. Oren's Hummus co-owner Mistie Boulton said DoorDash still takes that approach. The team comes to meet with her every quarter and she serves as a beta tester for new products. The restaurant, which started in Palo Alto and has since expanded to a half-dozen locations across the Bay Area, was one of DoorDash's first clients, latching onto the opportunity to reach more customers beyond its small establishment that frequently had lines snaking out the door. "We just fell in love with the idea," Boulton said. "The number one thing that encouraged and enticed me to want to work with them was Xu's passion. He really is one of those people that you can count on." Wall Street is now counting on Xu's ability to execute big deals, even with the company having this month surpassed $10 billion in delivery orders worldwide. The acquisition of Deliveroo, based in London, marks a renewed effort by DoorDash to expand its presence overseas, following the purchase of Finland's Wolt three years ago. The cash deal for SevenRooms, a New York City-based data platform for restaurants and hotels to manage booking information, takes DoorDash into an entirely new category. Xu told CNBC that DoorDash is a "multi-product company now that's operating on a global scale." Following the acquisition announcements, which coincided with a disappointing earnings report in March, analysts at Piper Sandler reiterated their hold recommendation on the stock. One reason for concern, they said, was that "integrating multiple acquisitions at once may create some noise near-term."
Yahoo
2 days ago
- Business
- Yahoo
DoorDash awards $200,000 in wildfire recovery grants to L.A. restaurants
DoorDash has awarded $10,000 grants to 20 Los Angeles-area restaurants affected by the January wildfires, in an effort to provide a financial lifeline to small businesses as they continue efforts to rebuild. The grants, part of DoorDash's Restaurant Disaster Relief Fund, were announced during a gathering at the former site of Amara Kitchen in Altadena, which was destroyed in the Eaton Fire earlier this year. The event brought together local restaurant owners, community leaders and residents to recognize the role small eateries play in their communities and the resilience they've shown in the face of disaster. 'When we lost Amara Kitchen to the fire, we lost more than just a building—we lost a gathering space, memories, and a part of our identity,' said owner Paola Guasp. 'There have been moments of heartbreak, but also of deep gratitude. This support from DoorDash gives us hope and helps us begin the hard but hopeful work of rebuilding.' The grants are designed to help restaurant owners cover critical expenses like rent, payroll, inventory and equipment replacement. For many of the 20 recipients, the funds represent a path toward reopening or continuing operations after the wildfires caused significant setbacks. 'Local restaurants are the beating heart of Altadena and neighborhoods across Los Angeles,' said Judy Matthews, president of the Altadena Chamber of Commerce. 'They nourish us, employ us and reflect the incredible diversity of our region.' Since its launch in 2021, DoorDash says its Restaurant Disaster Relief Fund has distributed over $2.5 million in aid to more than 250 small businesses affected by natural disasters across the country. Los Angeles-area grant recipients include: Amara Kitchen, Pasadena Azar's Sports Bar & Grill, Newbury Park Cafe de Leche, Altadena Coffee and Plants, Pasadena Cuernavaca's Grill, Los Angeles Emma Habesha Restaurant, Inglewood Go China, Pasadena Hello You're Welcome, Pasadena Side Pie, Hayward Monsieur Crepe Cafe, Sierra Madre Mother Moo Creamery, Sierra Madre OLLO, Malibu Renovo Inc, Arcadia Sampa's Pizza, Santa Monica / Marina Del Rey San Marino Cafe and Marketplace, San Marino Sorry Not Sorry, Los Angeles Spruzzo Restaurant & Bar, Pacific Palisades Sugarbird Sweets and Teas, Glendale Vienna Pastry, Los Angeles Xuntos, Santa Monica DoorDash said the grant program will continue to offer support to small restaurants facing hardship from disasters, reinforcing its commitment to helping communities recover and thrive. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
2 days ago
- Business
- Yahoo
Is DoorDash Planning To Gobble Up Europe? Company Strikes $3.9 Billion Deal To Buy UK Food Delivery Company Deliveroo
DoorDash (NASDAQ: DASH) is synonymous with food delivery in the U.S., and now it appears the company is positioning itself to take on the European delivery giant has announced it will acquire U.K.-based Deliveroo in a $3.9 billion deal. U.K.-based Deliveroo is like DoorDash in that it is one of the most recognizable names in its geographic market. The deal, which Reuters says both sides have been working on for the last several months, is indicative of a changing landscape in the food delivery business. According to Reuters, the sector has been struggling due to several factors. First, inflation and increased costs have forced consumers to tighten their belts, and dialing back on luxuries like dinner delivery is an easy way to cut expenses. Second, there is an overabundance of competitors in the sector. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – The two obstacles to profit have created an environment where consolidation is much more likely. AJ Bell Investment Director Russ Mould told Reuters he believes the entire sector has been weakened by an oversaturation of delivery services competing for the same customers. That kind of climate inevitably means that some food-delivery services operating today will not survive the current downturn. 'Only the strongest will survive, and they're the ones picking up smaller rivals who realize their future is [the] best part of a bigger entity, and not going it alone,' he said. DoorDash may have gotten a good deal on the final price. According to Reuters, Deliveroo shares are trading on the London Stock Exchange for less than half of their 2021 IPO price. Deliveroo CEO Will Shu, who delivered meals himself during the company's formative years, was philosophical about the current business climate and its effect on the company's share price. Trending: Invest where it hurts — and help millions heal:. 'That was a different time, (and) a different interest rate environment," Shu told Reuters. He was optimistic about Deliveroo's long-term future, but also very aware of how much competition his company was facing. 'The board and myself evaluated that and said, 'Where do we think Deliveroo should be in order for us to truly win?' And we thought this was the right place for us,' he said. Shu's analysis illustrates the reality of being a CEO of a company. You have a duty to your shareholders and investors to do what's best for the company, even if that means being acquired at a relative discount by a larger company. With that said, it's not all bad news for Shu. Reuters estimates that he will receive roughly $215 million for his Deliveroo shares. "I could not be more excited by the prospect of what DoorDash and Deliveroo will be able to accomplish together," said DoorDash CEO Tony Xu. " We'll cover more than 40 countries with a combined population of more than 1 billion people, enabling us to provide more local businesses with the tools and technology they need to thrive." Reuters estimates the two companies did roughly $90 billion in delivery orders in 2024. Read Next: Image: Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article Is DoorDash Planning To Gobble Up Europe? Company Strikes $3.9 Billion Deal To Buy UK Food Delivery Company Deliveroo originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved.
