How COVID-19 Accelerated DoorDash's Enterprise


DoorDash was submitted to go public Figures released today showing rapid growth, improved profitability, and an improved cash flow record, which helped explain how the company privately grew to a valuation of $ 16 billion. The Unicorn's upcoming liquidity event will enrich a multitude of venture capital firms that are betting on its eventual maturity.

Instead of posting this entry from The Exchange on Monday, we have released it today for your Friday and weekend reading. Enjoy! – Alex and Walter.

But remarkable with DoorDash Impressive results are the effects of COVID-19 accelerating pre-existing worldly trends and fueling the unicorn's growth. Before we dive into pricing this IPO and guess what the company might be worth, we should strive to understand what part of its 2020 business profits could come from the pandemic – and may not last in the future.

We are not pessimistic. We just want to understand the company better. And DoorDash agrees with our general stance, writing in its S-1 file that "58% of adults and 70% of Millennials say they are more likely to have restaurant food delivered than they were two years ago," adding that they do the case is "The COVID-19 pandemic has further accelerated these trends."

In addition, DoorDash clearly states elsewhere in its records that COVD-19 has resulted in a "significant increase in sales, total orders and marketplace (gross order volume) due to increased consumer demand for deliveries as more retailers use our platform to to facilitate delivery and acceptance as well as improved efficiency of our local logistics platform. “Subsequently, the company warned investors that the circumstances that have accelerated the growth of our business due to the impact of the COVID-19 pandemic may not continue into the future and we expect growth rates in sales, total orders and The Marketplace ( Gross order volume) will decrease in future periods. "

We do not speculate idly.

Let's watch DoorDash's growth accelerate from 2019 to 2020, then take a look at how the company's economy improved over the same period to give the company a shot at adjusted profitability for the full year give, an almost unheard of result in the on-demand market.


DoorDash generates revenue when a customer orders groceries through its service. The entire costs, taxes, fees and tips for groceries are divided up, distributed to yourself, the merchant creates the goods and the deliverer.

In an "illustrative" example where DoorDash notes its "approximate average information per order" for 2019, the breakdown works as follows:

Invoice: $ 32.90
Dealer: $ 20.10 or 61%
DoorDash: $ 4.90 or 15%
Supplier: $ 7.90 or 24%

Given that the company is giving us old data and DoorDash's performance this year has been stellar in terms of generating higher gross profit, I wonder what happened in the upheavals of 2020. However, the old numbers are enough for what we need, which is to understand the relationship between Gross Order Volume (GOV) and DoorDash revenue. When the former increases, the latter increases.

So when the orders go up: