Tag Archives: Economy Sharing / Service on Demand

CEO of ‘Builderman’ Roblox Goes to Wall Street with Troop of Young Gamers | Instant News


Chief Executive Roblox Corp. David Baszucki won the loyalty of tens of millions of videogamers with a do-it-yourself gaming approach that defies industry-specific formulas for success.

Roblox is slated to make its public market debut March 10 through direct listing, an unconventional process that allows companies to trade on the stock exchange without raising new capital. The company based in San Mateo, California, was founded in 2004, rotated from traditional public offerings last year after

By Dash Inc.

and

Airbnb Inc.

jumped beyond expectations in their IPO.

Roblox founder and CEO David Baszucki, pictured in 2018, is a frequent presence on the platform, under the name ‘Builderman.’


Photo:

Steve Jennings / Getty Images for TechCrunch

Roblox’s debut is coming as the coronavirus pandemic has prompted people to do so spend more money and time on video games than before. Tech valuations have surged over the past year – Roblox was personally worth $ 29.5 billion in January, up more than seven times from early 2020 – although the stocks have recently faltered amid shifting investor sentiment that an improved economy will benefit the sector other.

Instead of relying on Hollywood-like budgets and rock star talent to produce a few blockbuster games each year, Roblox is shifting game development to its own players. These players, especially teenagers and preteens, in turn produce their own hits and earn 70% of the revenue their work generates.

“We are like YouTube, except our content is a game, and our content allows everyone to play together,” Baszucki said in 2018 while speaking at his alma mater, Stanford University. The 58-year-old man himself often appears at Roblox, using the name “Builderman”.

This approach has earned Roblox an estimated 33 million daily users who can choose between tens of millions of multiplayer games, ranging from obstacle challenges and catch the flag iterations to contests based on popular characters like Peppa Pig and Sonic the Hedgehog. The company provides free tools and instructions that players – even those with no coding experience – can use to create games for its platform.

Samuel Jordan of Fort Lauderdale, Florida, took a hiatus from college about a year ago to focus on creating games and other digital content for Roblox with his business partners. The 21-year-old, who participated in the company-run accelerator program in the summer of 2019, says he made about $ 600,000 last year from his Roblox creations, up from $ 30,000 in 2019.

“This is crazy,” Jordan said, adding that the pandemic was likely to contribute to a tremendous increase. More than 300 Roblox developers made $ 100,000 or more last year, the company said.

The health crisis provided significant fuel for Roblox’s business. Revenue grew 82% last year to $ 923.9 million, while orders – sales of virtual items on the platform – more than doubled to about $ 1.9 billion.

Samuel Jordan of Fort Lauderdale, Florida, says he made an estimated $ 600,000 last year from his Roblox creations.


Photo:

Maria Alejandra Cardona for The Wall Street Journal

London’s Alan and Sinéidin Cooper said their two daughters, ages 5 and 10, and 7-year-old son each spent about five hours a week at Roblox before the pandemic. Now that time is doubled because they are using the platform to connect with friends. The couple treated their kids to Robux worth around $ 40 to $ 45 per month.

“It’s a great way for them to socialize,” Mr said. Cooper.

Roblox hasn’t been able to turn user loyalty into profit, as its net loss in 2020 swelled to $ 253.3 million from $ 71 million a year earlier. The company has said it plans to continue investing in the platform, which can be used for distance learning, conferences and other group experiences, such as concerts.

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Like other online hangouts featuring user-generated content, Roblox has to contend with predators and troublemakers who target children with inappropriate material – a particular concern given that more than half of the platform’s users are under 13. The company says it has made significant steps to keep users safe, such as by adding a communication filter to eliminate offensive speech.

Supporters include the large venture capital firm Andreessen Horowitz, Altos Ventures and Greylock Partners. David Sze, a Greylock partner, said the company invested in Roblox partly because of Mr. Baszucki. While other CEOs may have switched from business models after modest initial growth, Mr. Baszucki remains confident in Roblox’s user-created mission, says Sze.

“It’s like 10 years walking through the desert without anyone trusting you,” he said. “Dave against all odds.”

Mr. Baszucki, who declined to be interviewed for this article, started and then sold a software company that specialized in physics simulation before founding Roblox with fellow programmer Erik Cassel, who died of cancer in 2013. They started making games for the platform, but soon invite other players to create their own. Roblox was released to the public in 2006.

“We immediately realized what they were building was much more interesting and exciting than anything we had ever made,” Baszucki wrote in a Roblox securities filing. Mr Baszucki is the largest shareholder of the company and holds 70% of the voting rights. He will forego cash and equity compensation for seven years after Roblox goes public, and in return qualify for a performance-based stock award, which he intends to donate for philanthropic causes.

Mr. Baszucki was an investor in Friendster, an early competitor for

Facebook Inc.,

and he sees Roblox as a combination of Second Life’s social networking platform and online virtual world, said Matt Dusek, a Roblox start-up employee who left the company in 2019. “He sees things as further away than anyone else around him often does,” Said Mr. Dusek.

Samuel Jordan and his business partner Kyle Hulse outside their shared office space in Fort Lauderdale on Thursday.


Photo:

Maria Alejandra Cardona for The Wall Street Journal

In the following years, Roblox gradually expanded its user base. Mr. Baszucki, as “Builderman,” will greet new players digitally, appearing as one of the platform’s signature box avatars and offering tips on how to get started. Popular games inspire players to become developers, who then make more games, attracting more users – the so-called network effect.

Roblox’s user-generated gaming strategy has won praise from industry leaders. Tim Sweeney, CEO of “Fortnite” creator of Epic Games Inc., credits the company for helping gamers become game makers. “Roblox has done a tremendous job building the ecosystem,” he said in an email.

Although the company has warned that people may spend less time with its games as the pandemic fades, it wants to continue to add to its base of more than 8 million developers. Similar to other videogame publishers, Roblox is also looking to join more brands like

Nike Inc.

and

Mattel Inc.

about marketing promotions.

Write to Sarah E. Needleman at [email protected]

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Uber’s Food-Delivery Business, Cost Cuts Cushion Pandemic Hit | Instant News


Uber Technologies Inc. posted narrower annual losses due to aggressive food delivery and cost-cutting businesses, even as the coronavirus pandemic destroyed its core ride-hailing operations.

The San Francisco-based company on Wednesday reported a net loss of $ 6.76 billion for 2020, compared with a loss of $ 8.5 billion a year earlier. While widespread orders for shelter in places dealt a blow to Uber’s freight business, its share of food deliveries is soaring as the same mandate keeps people from going to restaurants. Revenues decreased 14% year over year to $ 11.13 billion.

Uber overhauled its business during the health crisis, cut about a quarter of its staff and dumping non-core businesses, among other moves, which saved him $ 1 billion in fixed costs last year.

The company separately doubles shipments, buying snack delivery rival Postmates Inc. last year and delivered new items such as groceries and medicine. Earlier this month, Uber jumped into alcohol shipping with $ 1.1 billion Drizly’s acquisition.

“It has become clear that the pandemic has increased consumer appetite for on-demand delivery of not only food, but all goods, and we have taken major steps to address this enormous opportunity,” Uber Chief Executive Dara Khosrowshahi said in a telephone conference. with the analyst.

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DoorDash buys Chowbotics, a maker of food preparation robots | Instant News


DoorDash Inc. has purchased Chowbotics, a maker of food-preparation robots, as part of its efforts to help merchants grow their businesses, the delivery app company announced Monday.

Hayward, California-based Robot Chowbotics makes customizable salads, grain and stir bowls, parfaits, cereals, and snacks and can be found at grocery stores, hospitals and other locations. DoorDash thought that the machine could be used to automate some food preparation in restaurants.

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did not disclose how much was paid for the company, which said on its LinkedIn profile that it had deployed more than 100 of its robots. The deal was finalized late last year, said a DoorDash spokesman.

“Bringing Chowbotics technology to the DoorDash platform provides us with new opportunities to help merchants expand their current menu offerings and reach new customers in new markets,” said DoorDash co-founder Stanley Tang in a statement.

As the coronavirus pandemic has pushed the delivery of food and other goods to record levels, DoorDash is the top food delivery app in the US, with a 50% market share, according to Edison Trends.

See: The pandemic has doubled the food delivery app business

The venture-backed Chowbotic raised $ 20.8 million, according to Crunchbase, and was valued by PrivCo for $ 50 million to $ 100 million in 2018.

Rick Wilmer, Chowbotics chief executive, said in a statement that the deal would allow his 7-year-old company to take advantage of DoorDash’s lead in US food delivery.

“DoorDash has unmatched reach and expertise to help us develop and apply our technology more broadly, so together, we can make fresh, nutritious food easy for more people, says Wilmer.

DoorDash shares closed at $ 177.43, a 2.1% decline, on Monday. The company’s shares are up more than 24% so far this year.

The company’s acquisition of Chowbotics is not the first step in automation. In 2019, it bought Scotty Labs, which works on technology to remotely operate vehicles. The fair value of the purchase is $ 5 million, according to DoorDash’s filings with the Securities and Exchange Commission.

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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.

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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 New California Law Could Ruin Some of the Growth for the Food Delivery Platform | Instant News


How valuable the restaurant choice is delivery platform growth over the past year? We can find out immediately.

The California bill is set to require third-party delivery platforms to declare agreements with merchants to ship food orders starting January 1. The bill will effectively end the growth strategy platform incl

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and Postmates have historically worked to rapidly increase their delivery footprint. Delivery platforms must remove so-called non-partnered food vendors, or whose agreements they do not have, from their California applications. Without a deal, delivery platforms can post restaurant menus without a permit, sometimes causing complications for restaurants such as overcrowded dining rooms with unexpected deliveries or orders for items the kitchen no longer makes.

While users may be surprised, the company itself is well prepared. DoorDash, for example, said in its public offering that more than 95% of its gross order value came from merchants who partnered in the nine months ended September 30. As well as,

Uber Technologies

Uber Eats said it was developing active partner restaurants by 70% from year to year in the third quarter.

The California bill won’t affect all players equally. The impact on Postmates, whose biggest market is Los Angeles, could be enormous. Postmates has 700,000 merchants on its platform, according to a September regulatory filing from Uber.

Of these, only 115,000 were partners at the time, according to the company.

Specifically in California, Postmates said it had 40,000 merchants who were not partnered in September when the bill was signed into law. They will have to leave the platform if they are not converted by the end of the year. Any potential impact will flow to Uber’s business since they acquired Postmates this year.

No major player is completely isolated.

Grubhub,

which has recently started adding non-partnered restaurants to its platform, may also see some of its recent reversed advantages. While the company has for years prided itself on only listing restaurants that have partnership agreements, the tremendous growth of competitors forced Grubhub’s hand to also add non-partnered restaurants to better compete.

According to the proposed regulations, Grubhub is growing its restaurant by offering 114% for the year ending September 30. As of the third-quarter submission, 55,000 of its 300,000 restaurants remained unpartified. While the largest market is New York City, it appears that a significant number of non-partnered restaurants are in California.

More broadly, many of the Covid-19 temporary assistance regulations cover food delivery commission limit in cities nationwide also includes increased transparency measures. Starting last week, for example, Minneapolis began requiring delivery platforms to obtain restaurant approval for services performed such as delivery. Similar regulations were passed in Philadelphia, Denver, Tucson, Ariz., And elsewhere. An assembly bill introduced in New York in November would ban unauthorized lists of food vendors on delivery platforms across the state.

While restaurant selection is just one of the many ways in which delivery platforms compete for consumer businesses, this is perhaps the most important. DoorDash, for example, now has a dominant market advantage over its US competitors, even though its food is on average not up to the fastest and loyalty program not cheaper than those offered by competitors. It is now believed to have the largest US partner merchant network. Much of that growth was achieved by asking restaurants to partner with them after demonstrating the platform’s value, not before.

The rules will increase barriers to entry, which may be the reason why some in the industry support them. But by requiring a partnership agreement up front, at least a percentage of restaurants will choose not to use any platform and just run it themselves. That could hinder industrial growth.

Write to Laura Forman on [email protected]

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