The 7 Foodtech startups that will have market share in the food delivery space in 2016

If you really look into it, which one of these startups is best positioned to dominate?

1. Amazon Prime Now Food Delivery 

amazon Prime Now Food Delivery

Amazon is hoping utilize their massive market presence in the food delivery space. 

2. Grubhub / Seamless

Grubhub / Seamless

Grubhub has been slipping recently, and hopes that expansion in the food delivery market will reverse their results for investors. 

3. Postmates 


Postmates is a top gun in the food delivery space. They have proven expansion capability and offer great UX/UI. 

  • Business Model:
    5$ + 9% fee 
    Revenue Sharing with some businesses (Partnerships with Chipotle and Starbucks)
  • 2016 Forceast: 

    Postmates is certainly in the heat of the fight for several reasons. On the user experience side, its app is said to have a better design than competing apps like Seamless and Grubhub. 
    For employees, Postmates offers generous insurance coverage comparable to transportation giants Uber and Lyft. 

    Downsides include an average at best pricing structure, as well as scale disadvantages compared to larger, more established competitors like Amazon and UberEats. However, there is reason for optimism in 2016: Postmates recently secured megadeals with Chipotle and Starbaucks, and is already established as a dependable delivery option in most major cities in the US.

    In adjacent personal delivery markets, they are gaining significant traction, most recently a deal with Apple in NYC

4. DoorDash 


Doordash is relatively new on the food delivery scene but has co-founding team from Standford and venture backing form Kleiner-Perkins. 

  • Business Model: 
    Flat Delivery Fee starting at $1 in select markets such as Chicago
    Undisclosed commissions with restaurants
  • 2016 Forecast: Founded by Stanford grads and fresh off of a $40 million Series B led by Kleiner-Perkins, Doordash is hot topic in the food delivery space. They have recently experienced some hiccups with pending lawsuits from large fast food chains such as In and Out Burger, and do not have the bandwidth of some other competitors (a couple months ago they were active in only eight markets). However, they are growing and following suit with other competitors by looking for market share in non-food delivery. 

    Look for measured growth rather than bustling expansion in 2016, but do not sleep on DoorDash, the capital and talent is there, and an acquisition could be an option down the road. 

5. Caviar 

Caviar Food Delivery App

Caviar originated as an exclusive food delivery app with curated restaurant offerings. 

  • Business Model:
    $1.99 - $6.99 Flat Delivery Fee
    Undisclosed commissions with restaurants
  • 2016 Forecast: Approaching a year after a merger with Fastbite and nearly 2 years after an acquisition by Sqaure, Caviar may need to choose between its original identity: curated restaurants only, sleek design, and in house photography, and expansion to the masses. 

    Datanyze reports that Caviar has approximately a 10% market share in food delivery. With tasks such as perfecting the FastBite integration and the growing pains of expansion to new markets. We do not see Caviar Market share increasing much. 

6. UberEats


Uber is hoping that strong band recognition will propel UberEats successfully into the food delivery space. 

  • Business Model:
    3$ Delivery Fee Base 
    Undisclosed commissions with restaurants
  • 2016 Forecast: UberEats is still getting started. They have only recently launched in 2nd tier regional markets like Seattle, which could be key to adoption beyond tech Hubs like NYC an SF.

     Uber does have market recognition and branding in spades, however they are facing competition from not only food-delivery focused startups, but also old acquaintances from the ride-sharing industry as well: Sidecar announced a partnership with Yelp-Owned Eat24 earlier this year (See Below), and companies like Lyft may also emerge in the food delivery space in 2016.

    This additional competition, combined with UberEats' effort to re-brand from parent Uber, may subdue growth in early 2016 at least. We think UberEats moment may come closer to 2017 than 2016, if at all.   

7. Eat24

Eat24 subsidiary of Yelp

Eat24, a subsidary of Paypal, does not charge a base fee for online food orders. 

  • Business Model:
    Consumer pays delivery fee set by restaurant, no add on fee by Eat24
    12.5% commission fee for restuarants
  • 2016 Forecast: 

    Eat24 has a couple key advantages heading into 2016. It does not charge an additional fee for delivery, and Yelp is reportedly focusing on embedding Eat24 directly into the Yelp platform.

    In addition Eat24's network is already well established after Yelp's $130 Million dollar acquisition in February. They will be partnering with well over 20,000 restaurants in over 1,000 cities by late 2015. 

    Despite some concerns about shady marketing tactics by Yelp and some legal issues with delivery employees, we are bullish on Eat24 in 2016. 

Best of the Rest in FoodTech Delivery Market:


Our picks: In the delivery space in 2016 we like food tech startup Postmates and Amazon Prime Now.

Other companies analyzed above are either to small for 2016 scale up or too big, fat, and slow to quickly build necessary infrastructure and services. 

Next up: We like UberEats in late 2016 / Early 2017, and predict that DoorDash will be acquired by a larger competitor. 

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