Tag Archives: corporate funding

DoorDash’s Appeal Beyond Food | Instant News


Food delivery platform

By Dash

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it is now trading almost 90% on it initial public offering price such as a vaccine that is widely distributed in the US and restaurants in some of its largest markets are poised to reopen outdoor dining. So why isn’t this stock too short?

The answer may be more about comfort than taste. Apart from restaurant deliveries, DoorDash has built its market share in third-party shipments for other goods, such as items from 7-Eleven, Wawa, Circle K and CVS. Post-pandemic, those additional opportunities could prove more important to DoorDash’s growth thesis than bearish investors appreciated.

Much of DoorDash’s appeal ahead of its December IPO is how quickly it can go from 0 to 60 in food delivery. The company said it had only a 17% share of the US market in terms of total sales in January 2018 but that share had grown to 50% in October – nearly double that of its next biggest competitor, Uber Eats. Now it turns out that in newer markets such as practical freight forwarding, DoorDash has grown even faster.

A report from Edison Trends Thursday shows DoorDash now owns 58% of US convenience store spending via third-party delivery apps, more than double that of its next biggest competitor, goPuff. Last January, Edison Trends had DoorDash’s share of around 5% and goPuff’s 70%. For all of Uber’s talk of leaning heavily on additional delivery services, Uber Eats’ market share in third-party convenience goods is now just 8%, according to the report.

For DoorDash, the supermarket may be more than just the icing on the cake. According to Edison Trends’ analysis, overall online consumer shopping at convenience stores grew by nearly 350% in 2020, almost three times faster than online restaurant consumer sales. DoorDash customers increased their convenience store spend by 162% sequentially from the third to fourth quarters, according to EdisonTrends data – a good sign for DoorDash’s first earnings report as a public company to come later next month.

Opportunities beyond traditional food delivery appear to be a big part of what differentiates analysts who have remained positive at DoorDash from those who feel they are overvalued. In his initiation report, Truist analyst Youssef Squali pegged the potential addressable markets in groceries and convenience, including e-commerce and bricks and mortars, about $ 50 billion for the industry as a whole, with an additional $ 22 billion coming from specialty food stores and $ 60 billion came from beer, wine and liquor stores. With regards to a highly concentrated wholesale market, he notes that more fragmented areas such as fast delivery could be more profitable. Meanwhile, Angelo Zino from CFRA Research initiated coverage on DoorDash with a sale rating, not to mention the convenience opportunity.

Cautious investors worry that demand for food deliveries will ease as the pandemic eases, but that doesn’t mean demand in other areas will shrink. Analyst forecasts compiled by Visible Alpha show DoorDash’s average order value decreased 23% from 2020 to 2025, but monthly orders per active customer grew by nearly 30% during that period. More options should continue to bring more customers to the DoorDash platform, that is very strong in the suburban market practical shopping is not necessarily walkable Analysts estimate DoorDash’s monthly active customers will grow by 21% this year alone.

SHARE YOUR MIND

Have you used DoorDash to order groceries during the pandemic? Join the conversation below.

In its DoorDash initiation report,

JP Morgan‘s

Doug Anmuth called food delivery a “forever changing category,” noting that while growth may slow, activity will still pick up, given the value of convenience and consumer choice. He cites new verticals, such as convenience, grocery stores and pharmacies, as key growth drivers.

When it comes to restaurant outings, visiting a corner shop is always more of a chore than a gift. It’s possible that even though visitors are racing to return to eat after the pandemic, they will continue to order everyday items.

To DoorDash, that is indeed a comfortable narrative.

Ghost kitchens have sprung up across the US as food deliveries spike and restaurant dining slumps amid the pandemic. This business, which can organize food preparation for several restaurants in one location, is attracting interest from investors and restaurant owners. Photo: Adam Falk / The Wall Street Journal

Write to Laura Forman on [email protected]

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The future of startup cryptocurrency Ripple hangs on the SEC’s case | Instant News


Brad Garlinghouse, Ripple’s chief executive, last year publicly contemplated at the World Economic Forum in Davos, Switzerland, the initial public offering for the San Francisco startup.

The company recently raised about $ 200 million in a venture funding round led by Tetragon Financial Group, with a valuation of $ 10 billion. The value of its flagship product, a cryptocurrency called XRP, has fallen over the previous year. But Ripple is poised to rebuild the infrastructure for cross-border trade, said Garlinghouse, promising that its future is bright.

A year later, the IPO was canceled. Instead, Ripple’s future hinges on the judge’s decision in a civil suit filed in December by the Securities and Exchange Commission.

Regardless of the outcome, this case is expected to set a major precedent for how US regulators create rules and laws covering cryptocurrencies. It also highlights a broader truth about most digital currencies: Beyond the two largest, bitcoin and ether, most of the hundreds of others have struggled to find utilitarian value beyond speculation.

At the heart of the SEC’s suit is the debate about XRP, a bitcoin-like digital asset created by the founder of Ripple that will grow to become the world’s third-largest cryptocurrency. It is designed to be part of a network that will help banks cut costs in cross-border transfers. The related software, however, never gained traction, the SEC accused, leaving XRP with no apparent purpose, other than to funnel sales to Ripple.

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Fashion Retailer Express Taps Adviser, Seeking Financing to Live Longer from Covid | Instant News


Fashion retailer Express Inc. has hired investment bank Lazard Frères & Co. to help raise enough financing to get the company through the Covid-19 pandemic, said CEO Timothy Baxter.

A workwear retailer based in Columbus, Ohio, wants to strengthen its finances, says Baxter. He said Express was not considering bankruptcy “and continues to take decisive and appropriate action to manage liquidity during this prolonged pandemic.”

With so many Americans working from home, the pandemic has dealt a devastating blow to Express and other retailers focused on clothing designed for the office. The company wants to increase its cash reserves to keep it afloat until enough of the US population is vaccinated against the coronavirus to allow for the resumption of direct spending and office work, according to people with knowledge of the matter. Without additional financing, which can come in the form of first-in-last-out facilities, companies could face cash shortages, people said.

Mr. Baxter said Express “has several possible options for increasing liquidity as it enters 2021.” Earlier this month, the company reported a comparable 30% drop in sales last quarter and said it would cut 10% of its company staff to help save cash.

Consumers who are stuck at home are spending more of their money on casual wear and sports, said Burt Flickinger, managing director of Strategic Resources Group, a consulting firm that focuses on retail and consumer companies.

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How Brazil Became a Hot Market for IPOs | Instant News


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The Fast Food Chain Sees the Shift Made When Pandemic Pays | Instant News


Fast food restaurants respond to changes in consumer tastes during the coronavirus pandemic in ways that have increased profits in some chains to where they were before the health crisis or even higher.

Some restaurants focus on expanding their takeout and drive-through business, while others are betting on delivery services amid the recent surge in infections and changing regulations in the US. And many expect this effort to pay long-term because the pandemic shows no signs of fading and some consumer habits can change permanently.

Many fast food chains reduce staffing and cleaning costs by closing their dining rooms, and are in no hurry to reopen them. “For fast food restaurants, they don’t want to reopen their dining room because this lowers profitability and increases costs,” said Andrew Charles, an analyst at the investment bank

Cowen Inc.

Brands International Restaurant Inc.,

Burger King brand owners, Tim Hortons and Popeyes of Louisiana Kitchen, are redoubling existing efforts to improve digital offer and delivery services.

“Covid acts as an accelerator for several trends that we have identified in our strategy,” said Matthew Dunnigan, RBI chief financial officer.

The Canadian-US fast food chain relied on its digital sales channels when the pandemic struck, Dunnigan said. The RBI is extending pickup, drive-through and curbside delivery services, he said.

The company now has nearly 10,000 outlets offering shipping in the US and Canada, compared to several hundred in early 2018. RBI added more than 2,000 stores to its shipping network in the first months of the pandemic and boosted investment in its cellphones. application, said Mr. Dunnigan. He declined to give figures for the initiative, but said RBI investment in digital sales channels in recent years was huge.

Church’s Chicken, an Atlanta-based fast food operator specializing in fried chicken, multiplies on drive-through, which has been in focus since 2017, said finance chief Louis “Dusty” Profumo. “We have been doing this for years, and the results pay off. It really benefits our business, “he said, pointing to a 15% to 20% increase in drive-through sales since March, with sales now becoming almost all Church business.

Church’s is looking for ways to reduce the size of some of its restaurants, Profumo said. “Customers want their food anywhere, anytime,” he said. “It’s very efficient to run all of your business through drive-through.” Most dining rooms are closed for now, according to Mr. Profumo

Church’s Chicken launched a new delivery and payment system to restaurants operated by franchise holders, which make up the majority of outlets, Profumo said.

Panda Express in June added its own shipping service, said David Landsberg, chief financial officer of the holding company Panda Restaurant Group Inc. “We have made a greater commitment to delivery since the pandemic began,” said Mr. Landsberg.

Panda has invested $ 40 million since the beginning of the pandemic in improving health and safety measures and its shipping platform. The company is looking to hire 30,000 new employees this year, although it has recently stopped reopening the lobby for customers to carry out their orders.

Panda’s dining room remains closed, even though management wants to reopen it. “This is about when social guidelines distance, and at this point, it might not happen until around 2021,” said Mr. Landsberg.

About a third of RBI dining rooms in the US and Canada have been reopened, Mr Dunnigan said, adding that the company plans to do it for all of them. RBI posted a higher average revenue per order in the drive-through and shipping business compared to dine-in.

Chipotle Mexican Grill Inc.

earlier this month he said open more stores with drive-through lines for digital orders. More than 60% of new stores will include this line, which is specifically for receiving orders that are placed in advance online.

Even restaurants that offer dinner before the pandemic is adjusting their business.

Waffle House Inc., a restaurant chain based in Norcross, Ga., Expects more takeout customers as the pandemic continues, said Chairman Joe Rogers. “We will have a slightly more advanced business, and fewer competitors,” Mr. Rogers said, referring to the financial struggles of some of his rivals.

Write to Nina Trentmann at [email protected] and Mark Maurer in [email protected]

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