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DoorDash is winning the battle for the ’burbs

Happy Tuesday, folks and gentlepeople. There’s a lot going on. Today:Stay curious.

November 12, 2019




Happy Tuesday, folks and gentlepeople. There’s a lot going on. Today:

  • DoorDash delivers dominance by thinking outside the city.
  • Wine investors think Scandinavia looks kinda pretty.
  • Apple’s co-founder thinks his own company’s card is sh*tty.

Stay curious.

The Hustle Daily Email

The secret to DoorDash’s delivery dominance? The ’burbs, baybeee

Over the past few years, big businesses from Uber Eats to GrubHub have competed to be the one to cook up the most massive food delivery system.

But despite backlash related to its tipping policy, DoorDash surpassed both GrubHHub and Uber Eats over the past year to become the dominant deliverer. 

And now DoorDash is the delivery dynamo to eat beat 

As of September 2019, D-Dash commands roughly 35% of online food delivery sales, well more than GrubHub (~30% market share) and Uber Eats (~20% market share).

Launched in 2013, DoorDash hasn’t been around as long as competitors GrubHub (launched 2004) and Postmates (launched 2011) — although it does predate Uber Eats, which was launched in 2014. 

What it lacks in experience, though, it makes up for in cold hard cash: The delivery dynamo has around $2B in funding since it launched, including a $535m round in 2018 led by controversial Japanese investment giant SoftBank.

But the Big Bucks from SoftBank are only half the story…

DoorDash was only able to hit a growth grand slam by swinging for the fences — the picket fences, to be precise.

Other delivery businesses focused on expanding their services in major cities, but DoorDash instead doubled down on suburbs in an effort to cater to different demographics.

According to Bloomberg, DoorDash operates in 4k towns; Uber Eats, on the other hand, only operates in 500 cities. And, to better serve the ’burbs, DoorDash partnered with almost 90% of the top 100 US restaurant brands, including brands like Chili’s, which operates 80% of its locations in the suburbs.

The suburbs were good for growth…

But they weren’t necessarily good for the business’s bottom line. 

That’s right: Before you start salivating over DoorDash’s delicious business model, be warned: The company’s still not profitable.

Like many other companies that have been turbocharged by investment from SoftBank, DoorDash prioritized growth over profitability — a move that frustrated investors to the point that one even suggested a sale to rival Uber.

It’s a good reminder to investors: Growth comes in many different flavors… but not all of them taste so sweet.

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This company’s weed deal with the Ontario government has investors seriously s-toked

Let’s talk shop, my fellow green fiends (money, that is). 

Marijuana has been fully legalized in Canada since late 2018, and the Canadian cannabis industry is now worth a smokin’ $7B. 

To help with all the new THC transactions, Ontario partnered with this biz to handle online, mobile, and brick-and-mortar sales — the same company that just landed similar contracts in the U.S. (an $80B industry). 

*Sniff sniff* 

Smell that? That’s the sweet stink of opportunity

And if you like how that smells, get the full details on this up-and-coming stock opportunity by registering for The Motley Fool’s StockAdvisor program. You’ll get the kind of behind-the-scenes investment advice that’ll keep you way ahead of the curve. 

Go green →
The Hustle says…

Humanity’s greatest achievement since the moon landing might just be this mug that lets you set the perfect temperature for your drink. We’re not being dramatic, you are. 

 “Sure, I shop online 25-30 times a week, but I always use Honey to automatically apply every discount available before buying. Because life is all about finding the best sale.” – Cayla, The Hustle’s R.O.S. (Resident Online Shopper)* 

If you’re like me, you have no idea what a smart office is — you just know you really, really want one. So, where to start? Download this Smart Office Guide from Owl Labs to get a breakdown of what makes up a smart workplace and how you can set up yours. How futuristic.*

What’s bigger than esports lately? Not much. Now, you can get in on the action with $NERD — the first ETF that lets you invest in 25 global esports and digital entertainment companies. And to think, your mom said playing video games was a waste of time…*

*Investing involves risk, including the potential loss of principal. For a prospectus and sources, click here. Foreside Fund Services, LLC, Distributor.

*This is a sponsored post.

Warmer weather heats up Scandinavian wine industry

Planning a bachelorette party in wine country? It might be time to nix Napa in favor of… Kalundborg? 

The wine industry is one of many being stomped on by climate change, and some bet Scandinavia will be the next big thing in viticulture.

Warmer temps are redrawing the winemaking map

Climatologists predict that by 2050 Scandinavia will warm up by as much as 43 degrees Fahrenheit. Already, warmer temperatures have contributed to a longer growing season, which has been a boon to white wine production.

Meanwhile, winemakers in France, Italy, and Spain are struggling with record high temperatures. Over the summer, they saw grapes burn on the vine as temps hit 105 degrees. Producers in South America, California, and Australia are also expected to take hits as the world gets warmer.

But don’t look for the Scandi-section at your local market just yet

Scandinavian wine revenues are still small next to those of other countries. Think $15.4m for all three countries compared with $30.8B in France alone. 

It’s still significantly more expensive to produce wine in Scandinavia, in part because these countries do not receive any of the billions in subsidies the European Union gives winemakers in other parts of Europe. And winemakers in Denmark and Sweden have EU approval to grow less than 1k acres of vineyards, while producers in France, Italy, and Spain operate on about 7.5m acres. 

Still, growth has been rapid. In the past 15 years, Denmark went from 2 commercial vineyards to 90. There are about 40 in Sweden and 12 in Norway. How do you say “cheers” in Danish?

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What Else…

💳 Is Apple’s credit card sexist? Apple co-founder Steve Wozniak is among the critics claiming Apple’s fancy new credit card uses a biased algorithm to offer women lower credit lines than men with comparable financial histories. Apple’s banking partner Goldman Sachs defends the card, but both companies are now on blast across social media. 

The airport fitness industry is taking off. Airport fitness centers, which are common across Asia, are finally landing in the US. One airport fitness startup called Roam offers $25 day passes and $30 monthly passes for fitness-minded flyers, and airports in San Francisco, Denver, Las Vegas, and Baltimore/Washington boast fitness options including yoga rooms, gyms, and even Zumba classes.

💲 Consider the Singles mingled. Yesterday, Alibaba sold $38.4B worth of SHTUFF on its annual Singles’ Day e-commerce-palooza, topping last year’s mark of $30.8B. This year, the sale cracked $1B in 68 seconds.

🍎 Amazon is launching its first grocery store. The e-commerce giant said it will roll out the concept in Los Angeles sometime next year. Amazon already owns Whole Foods and operates Amazon Go convenience stores, but the latest plans signal Amazon’s ambitions to conquer all grocery aisles –– not just organics and on-the-go foods.

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