“An Absolute Car Crash” – Deliveroo Shares Tumble 31% In London IPO
TYLER DURDEN, 31 March 2021
In what some might take to be the latest sign of exhaustion in global equity markets, shares of Deliveroo tumbled 31% in their market debut Wednesday after pricing at the lower end of their range.
Despite pricing near the bottom of its range, Deliveroo’s opening valuation of about £7.6 billion ($10.5 billion) was the highest in London since resources group Glencore’s 2011 IPO, according to Dealogic data.
But traders quickly wiped more than £2 billion ($2.8 billion) off its market cap as shares plunged. It’s a start contrast to the debut of DoorDash, which IPO’d in the US back in December. Its shares soared more than 86% at the open. One equity capital markets banker who was not involved in the deal described the debut to the FT as “absolute car crash”. In recent days, Deliveroo and its bankers had continued to insist that the offering had seen “very significant demand” from investors, even as its debu tprice range started to slip. Continue reading “Article: “An Absolute Car Crash” – Deliveroo Shares Tumble 31% In London IPO”
SEC is investigating Japanese investment giant SoftBank for market manipulation
DUNCAN RILEY, 25 March 2021
The U.S. Securities and Exchange Commission is investigating Japanese telecommunications company and investment giant SoftBank Group Corp. for alleged market manipulation.
Founded in 1981, SoftBank holds a significant share — 21.2% as of 2020 of Japan’s mobile phone subscription market — but is best known in the W est for its prolific investment portfolio. The list of companies SoftBank has invested in is too long to list but notable names include Uber Technologies Inc., Didi Chuxing Co. Ltd., Grab Holdings Inc., Nvidia Corp., TikTok owner ByteDance Ltd. and DoorDash Inc.
Along with operating the world’s largest technology-focused venture capital fund, Softbank has a particular interest in ride-hailing companies. Except for Lyft Inc., SoftBank owns significant minority stakes in just about every other company in the market. When Grab purchased Uber’s Southeast Asian arm in 2018, it was a deal between two SoftBank-funded companies. Continue reading “Article: SEC is investigating Japanese investment giant SoftBank for market manipulation”
DoorDash scam found to be fraudulently charging people who didn’t even have the app
Becky Robertson, 27 January 2021
An exposé from the CBC found multiple citizens across six provinces including Ontario had been charged, even those who live in remote areas where DoorDash isn’t even offered.
It also seems that many of the targets weren’t even existing DoorDash customers, making the methodology of how the fraudsters got their banking info all the more sketchy.
The origins of the scam and who is behind it have yet to come to light, but DoorDash has said that it is taking the situation very seriously and has worked with TD to resolve the issue through reimbursements.
Continue reading “Article: DoorDash scam found to be fraudulently charging people who didn’t even have the app”
Contract Violations, Fraudulent Activity Deactivations, Doordash, Grubhub and Uber Eats Cracking Down
ronald.l.walter, 25 January 2021
What’s going on with all this activation talk lately? What’s up with all this cracking down on contractors lately by Grubhub, Doordash, Uber Eats and maybe others? And how can you avoid being deactivated?
Spend much time lately in Reddit or Facebook groups for drivers and you see people left and right who are being deactivated or threatened with deactivation.
Referral policy fraud. Extreme lateness. Fraudulent activity. What’s going on here? We’ll get into why this may be happening. Then we’ll talk about whether these companies are crossing the line. Then we’ll get into what we can do to avoid being deactivated. Finally, what do you do when you do get deactivated?
Continue reading “Article: Contract Violations, Fraudulent Activity Deactivations, Doordash, Grubhub and Uber Eats Cracking Down”
3 Reasons to Avoid the DoorDash IPO and Other Food Delivery Stocks
Jeremy Bowman, 11 December 2020
It’s a great time to be a DoorDash (NYSE: DASH) insider. Shares of the hot food delivery start-up jumped 86% on its IPO day, rising off of an already elevated listing price. The eye-popping surge comes as restaurant delivery apps have been among the big winners during the pandemic and amid speculation of a broader bubble in tech stocks.
Still, at a valuation around $72 billion now, double that of well-established restaurant chains like Chipotle, for example, it seems too hard to justify DoorDash’s market cap. The company is still unprofitable, even as it’s experienced significant tailwinds from the pandemic. Beyond valuation concerns, there are a number of other reasons to avoid DoorDash and its food delivery peers.
Continue reading “Article: 3 Reasons to Avoid the DoorDash IPO and Other Food Delivery Stocks”
If you bought DoorDash at $180…
SirGasleak, 10 December 2020
No moat at all. Sure they have 50% market share but there are competitors. They’re a delivery service – anyone can do what they do. Not only does this pose a risk to market share, but it poses a huge risk to the already thin profit margins. At some point (because of 2-4 below) they will have to lower their fees and take rate, which will hurt margins even more.
No brand value or brand loyalty. People couldn’t care less who delivers their food, as long as it shows up on time and hot. Early in COVID I was using Skipthedishes until I got frustrated with poor service so I left. There is nothing to keep customers loyal to DoorDash if someone else offers better service, or the same service at a better price.
Continue reading “Article: If you bought DoorDash at $180…”
DoorDash Soars in First Day of Trading
Erin Griffith, 09 December 2020
Shares of DoorDash soared in their first day of trading on Wednesday, capping a year of outsize growth for the country’s largest food delivery company. DoorDash stock rose 86 percent above its initial public offering price of $102 to close the day at $189.51.
That valued the company at $72 billion, including employee-owned shares — more than the market capitalization of Domino’s Pizza and Chipotle Mexican Grill combined. DoorDash raised $3.4 billion, making it the one of the largest I.P.O.s of the year.
Continue reading “Article: DoorDash Soars in First Day of Trading”
DoorDash valued at $71 billion in blockbuster market debut
Noor Zainab Hussain, Joshua Franklin, 09 December 2020
(Reuters) -DoorDash Inc shares popped more than 80% in their debut on Wednesday, valuing the food delivery company at $71.3 billion or more than four times its worth at a private fundraising round six months ago, underscoring investor appetite for technology companies boosted by the COVID-19 pandemic.
Shares opened at $182 on the New York Stock Exchange, significantly above the initial public offering (IPO) price of $102 apiece and closed at $189.51. The company had raised $3.37 billion in its IPO on Tuesday.
Such a large first-day trading gain is likely to fuel criticism from some venture capital investors, including Benchmark’s Bill Gurley, who argue investment banks underprice IPOs so their investor clients can score large gains when the stock starts trading.
Continue reading “Article: DoorDash valued at $71 billion in blockbuster market debut”
DoorDash Soars in IPO to $60 Billion Market Cap
Christiana Sciaudone, 09 December 2020
Investing.com — Doordash Inc (NYSE:DASH) is a smash hit. The food-delivery company opened trading at $182, a whopping 78% jump over the $102 at which it priced on Tuesday.
The company sold 33 million shares — originally marketed between $90 and $95 — on Tuesday to raise $3.37 billion in its initial public offering and now has a market value of about $60 billion.
DoorDash’s IPO is the third-largest in the U.S. this year, topped only by Bill Ackman’s $4 billion blank-check company and Snowflake Inc’s (NYSE:SNOW) $3.86 billion offering.
Continue reading “Article: DoorDash Soars in IPO to $60 Billion Market Cap”
DoorDash IPO delivers billions to its Stanford founders
Tom Maloney, 09 December 2020
Stanford University students Tony Xu, Andy Fang and Stanley Tang had a revelation seven years ago in a Palo Alto macaroon store.
The shop’s owner showed them pages and pages of delivery orders she hadn’t been able to fulfill. Demand wasn’t high enough to hire a full-time delivery person, but there was no way she could drop off all the orders herself. It was a story the three heard again and again as they worked to understand how they could leverage technology to help small businesses.
They decided to build a basic web page with menus from local restaurants to see if there was demand for a delivery business. “It was super simple, ugly, and honestly we weren’t really expecting anything,” Tang said at a Stanford lecture years later. “All of a sudden we got a phone call – someone called! They wanted to order Thai food.”
Continue reading “Article: DoorDash IPO delivers billions to its Stanford founders”
DoorDash takes a hefty cut from restaurants, and risks losing them to cheaper options
Ari Levy, 08 December 2020
Salvatore Reina owns three Francesca pizzerias in New Jersey that have been closed for indoor dining during the pandemic. While much of his industry turned to DoorDash, Reina resisted.
“Third parties take a big cut,” said Reina, who opened his first pizzeria 12 years ago, about 20 miles outside of New York City. “I’d rather spend those marketing dollars to get people directly.”
As DoorDash prepares for its public market debut, an offering that could value the delivery app service at over $30 billion, the San Francisco-based company has to show that it can make enough money on every order to turn into a profitable business. Meanwhile, investors have to consider how many restaurant owners will eventually turn away from apps like DoorDash because the costs are too high for their low-margin operations.
Continue reading “Article: DoorDash takes a hefty cut from restaurants, and risks losing them to cheaper options”
DOORDASH IPO HAS ITS SKEPTICS
Joe Guszkowski, 08 December 2020
Third-party delivery company DoorDash will set a share price for its initial public offering Tuesday, riding a wave of momentum that could bring it a valuation of more than $30 billion.
In the latest sign of demand for its stock, the company on Friday raised the price range for its shares to between $90 and $95, up from $75 to $85.
But not everyone shares that enthusiasm about the IPO. Some investors question the terms of the offering and the company’s readiness for the public market, while others believe its growth runway is shrinking.
On Monday, CtW Investment Group sent a letter to DoorDash’s board raising concerns about the IPO’s share structure and how the company characterized public reaction to a former tipping policy. CtW works with union-sponsored pension funds.
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DoorDash Gets a Bullish Rating and Price Target Before It Starts Trading
Rhian Hunt, 02 December 2020
Food delivery IPO DoorDash, rival to Grubhub (NYSE:GRUB) and other restaurant delivery services, attracted its first major analyst rating even before its shares are actually trading on the stock exchange. The news site Benzinga reported yesterday that investment banking, wealth management, and financial analysis firm D.A. Davidson rated the company as a buy and gave its stock a speculative price target of $93 per share.
Davidson analyst Tom White laid out a bull case for DoorDash based on several metrics, including its 2020 U.S. delivery market share of 50%. That is up from a 36% share at the year’s beginning and 17% two years ago. White also points out that the company still has lots of room for growth, providing service to just 6% of America’s population and handling 3% of off-premise restaurant sales (18 million customers and $8 billion in gross order value, respectively). The $93 price target represents a sixfold multiple of DoorDash’s enterprise-value-to-sales (EV/sales) ratio.
Continue reading “Article: DoorDash Gets a Bullish Rating and Price Target Before It Starts Trading”
DoorDash: great unit economics, but many unanswered questions
Daniel McCarthy, 01 December 2020
A lot of people have a lot of different opinions about DoorDash in light of their pre-IPO S-1 filing. Many reporters and pundits are concerned about profitability in the restaurant meal delivery category as a whole, wondering whether any of these firms could ever sustainably turn a profit. Many others are more optimistic, pointing to some of the (many) customer-related disclosures that DASH scattered throughout its S-1. And of course, all of this uncertainty is only further compounded by COVID, which was and has continued to be a big shot in the arm for everyone in the category, but introduces yet more uncertainty about how the world will look post-pandemic.
Given my own academic research with Elliot Oblander and Kivan Polimis into the industry, which I will hopefully be able to link to over the next couple of months (if you’re interested, shoot me an email and I’ll make sure send it to you as soon as it breaks!), and given the volume of disclosures that DoorDash provided in the S-1, I took a closer look at the company to uncover what its underlying unit economic condition currently looks like, how COVID has impacted it, and what their “normalized” economics may be after stripping out pandemic-driven behavioral changes.
Continue reading “Article: DoorDash: great unit economics, but many unanswered questions”
4 Things to Know From DoorDash’s IPO Filing
Evan Niu, 17 November 2020
DoorDash has at long last filed the public version of its S-1 Registration Statement with the SEC, nearly nine months after submitting a confidential version to the SEC. The leading food delivery platform has opened its books for prospective investors ahead of going public through an IPO. The upcoming debut comes as Grubhub (NYSE: GRUB) is preparing to be acquired by Just Eat Takeaway. The company plans to list on the New York Stock Exchange under the symbol “DASH.”
Continue reading “Article: 4 Things to Know From DoorDash’s IPO Filing”