What about the race to acquire data? – Matt Kaplan – Medium

Sign in / Sign up

Share

Never miss a story from Matt Kaplan, when you sign up for Medium. Learn more

Never miss a story from Matt Kaplan

Lord of the kitchen cupboard

Nov 24, 2015

And in the race to capture funding and subsequent headlines

Not All that Glitters is Gold

What about the race to acquire data?

There is an unseen advantage to knowing the average ticket time of a medium rare burger compared across all 25 burger restaurants in your area, compared to peak times, compared to customer satisfaction. The more data points you have as a delivery service, the better you can predict when to order it, what driver should pick it up, and if the restaurant is even reliable enough to order from in the first place.

That scale has more of an impact on cost when you can imagine; I’m in apartment #203 and order from restaurant X and the guy in apartment #108 logs in and is incentivized to order at restaurant X with a reduced delivery fee. Think UBER Pool. That’s when delivery at scale starts to get interesting.

I agree that the way Postmates and DoorDash went about growth was a little shady, but, like some commenters have mentioned, sometimes you’ve got to do what you’ve got to do to hit critical mass. Ethics aside, they are certainly in a much better position to capitalize on scale than GrubHub is.

From my view on the front lines, restaurants seem to be partnering with Postmates and DoorDash left and right, especially quick service ones. The conversation goes something like this; “you’re telling me that orders are going to stream into my kitchen (often at off-peak hours) and I don’t need to staff anyone to field those orders? And if I don’t do this, the other burrito place down the street will and solely benefit from all those added orders? - I don’t care how you do it, where the hell do I sign up!” Says the owner facing unprecedented labor costs and slimming profit margins.

I’ve worked in restaurants for the last 10 years and recently started driving for DoorDash. Their model is far from perfect but they are clearly the closest (in greater Boston) to hitting critical mass. At the end of the day, business owners care most about their bottom line and customers crave more quality on-demand food options than GrubHub can provide. DoorDash and Postmates are currently most primed to deliver.