DoorDash buys Caviar
San Francisco restaurant delivery service DoorDash bought competitor Caviar on Thursday, according to an announcement by DoorDash CEO and cofounder Tony Xu. DoorDash purchased the online delivery company from San Francisco’s Square for $410 million, according to a press release.
“The combination of our two businesses will create the most
differentiated company in the industry, which is able to offer customers wideranging merchant selection,” Xu wrote on the DoorDash website.
Founded in 2013, DoorDash has raised $2 billion in funding. Caviar was founded in 2012 and was previously acquired by Square for $90 million in 2014.
DoorDash provides delivery service in 4,000 cities in all 50 states. Caviar, in contrast, does delivery in hundreds of cities, according to the release. While DoorDash represents more lowerbudget restaurants as well as national chains like the Cheesecake Factory, Caviar specializes in local and sometimes higherend restaurants like M.Y. China and Souvla. Grubhub and Postmates also provide delivery services for local restaurants.
In his announcement about the Caviar acquisition, Xu wrote that Caviar, like DoorDash, “(works) hard to help local restaurants attract more customers, grow their sales and expand their reach.”
However, some Bay Area restaurateurs have complained about what they see is the steep price for the service.
For example, Karen Heisler, coowner of San Francisco’s Mission Pie, recently told Mission Local that she was unwilling to pay a 25 to 30 percent service charge she said such services demand to get her pies delivered because it was much more than her profit margin. Not much later, Heisler announced that the cafe would close permanently.
Last week, DoorDash announced it would change its controversial policy of keeping customerprovided tips and generally using them to contribute to drivers’ base pay, rather than having them go directly to its drivers as additions to their base pay.