this week i'm thinking about – #8 – food delivery growth

Hey friends,

Happy 2019! I’m writing a weekly blurb about 1) one thing I learned, and 2) one question I’m thinking about that’s broadly tech-related.

If you have thoughts, please do reply! I’ll paraphrase the best responses in the next newsletter. My goal is to start conversations with people thinking about similar topics through different lenses. I'm trying this out with a small group of VIP friends, but if you know anyone who would be interested in the discussion, please do forward this along or have them subscribe here.


What I learned about: food delivery growth 📈🍟
Grubhub is often referred to as the incumbent food delivery player, which typically means that when newer startups succeed, Grubhub will lose market share (in both percentage and dollar terms). But the unusual thing about food delivery is that basically every player is growing extremely quickly.

Let’s put this in perspective. See the below image, where each player's MAU (US only, iOS + Android) is within months of any other player. According to the chart, Postmates and Doordash both grew MAUs <100% in 2017. But in 2018, each player (except UberEATS) has more than doubled MAUs, and the industry combined has grown MAUs by 2.35x YoY (Dec ‘18 / Dec ‘17), meaning accelerated growth across the industry. It is exceedingly rare in the startup world for late-stage companies to accelerate growth in percentage terms, not to mention an entire industry. Market has finally been educated, perhaps? Or more disposable income?

What I’m wondering about: ISAs 💸🎓
One of my former colleagues Geoff Lewis just led a $30M round into Lambda School, a coding school that’s free, but with a twist: they take a percentage of income post-graduation. I’ve been fascinated with the ISA (income-sharing agreement) model, and think Lambda has a unique cut. There has been some pushback that they’re essentially reinventing the tax system, but these critics miss important points: 1) Government doesn't provide sophisticated retraining programs, and 2) Lambda's revenue directly correlates with student performance and job placement, which I think works better in the form of a company than a country (revenue function is better optimized, smaller base of students meaning more manageable operation, no physical presence required). Are there other areas in which we could be using ISAs effectively?

Top replies from last edition (MVNOs, facial recognition):
In response to the Calm v. Headspace article, Jungwon mentioned the potential value of a mood tracker that is more sophisticated than alternatives like eMoods and Daylio. She also mentioned that a CRM-like solution for therapists could be extremely valuable to prevent suicides.

Chris noted the clear ability of big US tech companies (e.g. Facebook and Amazon) to provide best-in-class facial recognition solutions. Despite an Illinois biometric privacy law rolled back by Google, which loosened regulations around facial recognition, big tech companies are scared to get burned by opening up any sort of API access for their facial recognition.

What I’m reading