Food Delivery Is A Big Deal

The Lempert Report
May 15, 2017

And while the jury is still out on who and what will survive, there is no question that a lot of money is being thrown at these startups.

I still think in the longer term that the supermarket’s own click and pick up models, along with the Amazon Fresh brick & mortar models will prevail for grocery. Morgan Stanley reports that while Americans spend $500 billion a year at restaurants, including $210 billion in takeout food, just $11 billion goes to online food ordering – hence the opportunity. 

JoyRun is one of the newest startups and has raised $10 million.  What’s interesting about this one is that the company’s app lets people find out who is already heading out to a restaurant that they choose, then tack on an order of their own. Think of it as restaurant crowd sourcing where another person, not a delivery person from JoyRun, can pick up your order for a fee, or just do it as a favor.  

JoyRun’s CEO Manish Rathi says, “Everyone who uses the app must be willing both to order and to do deliveries. That’s the premise.”   

Lucky Lime is another new delivery option, this one from Celeb Chef Rebecca Meeker, with a focus on “healthy happy food”. 

Every week, Lucky emails a menu to its customers, who choose what they want by Friday at 5 p.m. They pick when they want everything delivered as one big package, from Sunday evenings or the weekdays before lunchtime. Entree prices tend to range from $10 to $16. 

Tapingo, is a 3-year-old company with $60 million in venture capital backing and almost 100 employees, and lets college students order food to pick up in a store, bypassing the line. That is available at almost 200 campuses. The company processes almost 100,000 orders a day. Tapingo integrates into on-campus food services so students can use the order-ahead feature with their meal plans. It has partnered with food-service operators like Aramark and Sodexo.   

And finally Door Dash, who has been around for a while sees their advantage as having an app that can tell you exactly when you’ll receive your delivery.  

Cary Mosier, the owner of Café Gratitude, a chain of vegan restaurants probably says it best. “At this point, everyone feels like they should be able to get what they want whenever they want and you kind of have to respond to that."