This week, DoorDash ($DOORDASH) raised $400 million in new equity funding at a $16 billion post-money valuation, Axios reported. The food delivery company is well-positioned to weather the pandemic’s economic impact, as people hesitate to dine out at restaurants.
As the delivery app looks to later break into public markets with an IPO, the latest equity round suggests that could take longer to unfold - even as other companies are zooming to exchanges and big debuts.
There has been some concern over the competition in the now essential on-demand food delivery business. But the potential merger between Uber ($NYSE:UBER) and Grubhub ($NYSE:GRUB) became less of a threat when it turned into a deal between Grubhub and the Netherlands-based company Just Eat ($LON:JE). Grubhub’s App Store ratings have grown over the past few months, but by just 17%, and still millions of ratings behind DoorDash.
During the Coronavirus outbreak, DoorDash had to raise its budget to account for new safety equipment for drivers. The company also had to hire more drivers to meet soaring delivery demand. Since March, DoorDash’s LinkedIn employee headcount rose 21%.
DoorDash expects operations to break even for the quarter ending June 30. It’s a good time to be DoorDash; let’s hope the company can maintain this momentum in the post-pandemic world.
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