IN THIS EPISODE, YOU’LL LEARN:

• How DoorDash came out of nowhere to become America’s leading meal-delivery service, usurping Uber Eats and Grubhub 
• What opportunity did DoorDash’s founders see to create value for both local merchants and consumers, and the incredible story of the company’s origins as Palo Alto Delivery
• What DoorDash has done to finally crack the code of positive unit economics in restaurant delivery
• Why DoorDash is well-positioned to continue growing both domestically and internationally
• How a tipping scandal nearly destroyed the brand
• Why the COVID-19 pandemic was such a significant boon to DoorDash’s business
• What to know about the company’s approach to management comp
• How to think about modeling DASH’s intrinsic value
• Whether Shawn and Daniel add DASH to their Intrinsic Value Portfolio

TRANSCRIPT

Disclaimer: The transcript that follows has been generated using artificial intelligence. We strive to be as accurate as possible, but minor errors and slightly off timestamps may be present due to platform differences.

[00:00:00] Daniel Mahncke: We’ve all used a food delivery service, so the value add is pretty much self-evident. Who wouldn’t want a pizza delivered directly to their doorstep? But now the DoorDash is the clear market leader in the US in meal delivery. They’re really trying to expand into being a logistics company to all forms of local commerce.

[00:00:17] Daniel Mahncke: Basically, the FedEx of not just local restaurant delivery, but groceries, household items like deodorant, toilet paper, flowers, and literally everything in between.

[00:00:27] Shawn O’Malley: They want to enable any local business to be able to deliver their products directly to your door, and if that vision comes through fruition, you’re talking about an absolutely massive addressable market. DoorDash should be able to grow strongly for many, many years.

[00:00:47] Intro: You are listening to the Intrinsic Value Podcast by The Investor’s Podcast Network. Since 2014 with over 180 million downloads, we’ve learned directly from the world to best investors. Now we are applying those lessons to analyze businesses and investment opportunities every week, helping you uncover intrinsic value. And now here are your hosts, Shawn O’Malley and Daniel Mahncke.

[00:01:19] Daniel Mahncke: On more than a few occasions on this show, Shawn will pitch a company that is ubiquitous in the States, but not really that known here in Germany, or at least not to the same extent. Lululemon and Reddit are two companies that come to mind immediately and well this week, I think it’s a similar story. So here in Germany, we don’t explicitly have a service called DoorDash, but of course I’m well aware with.

[00:01:40] Daniel Mahncke: Business model, and we have other apps here too. Our three biggest food delivery brands are Uber Eats, a local company called Lieferando, and then a Finnish company named Wolt, which is actually now owned by DoorDash after an acquisition deal, and no matter where you do it or under what brand, the fundamental questions about whether local delivery business can work remain the same.

[00:02:00] Daniel Mahncke: I think we’ve all used a delivery service like this before, and by the time you pay the service fees, the taxes and the tip, the price of your food can be nearly twice what it would be to just go and pick it up yourself, which perfectly illustrates why this industry is so challenging to begin with.

[00:02:17] Daniel Mahncke: Getting your food delivered does create a certain amount of convenience. I mean, that’s less valuable to some people and more valuable to others, especially at specific times like doing football games when everyone wants wings or pizza, but doesn’t want to miss any of the action on the field. But the point being that in many cases it’s hard for some folks to justify the cost of food delivery if it’s only saving you 10 or 50 minutes of time to pick up yourself while others are addicted to the habit or use it heavily, at least on the weekends.

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• Shawn & Daniel use ⁠Fiscal.ai⁠ for every company they research — use their ⁠referral link⁠ to get started with a 15% discount!
• Business Breakdowns’ ⁠coverage of DoorDash.⁠
• The Acquired ⁠podcast’s coverage of DoorDash.⁠
• Modern MBA on DoorDash and the ⁠myth of profitable food delivery.
• Explore our previous Intrinsic Value breakdowns: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Paypal⁠⁠⁠,⁠⁠ ⁠⁠⁠⁠⁠Uber,⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Nike,⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Reddit,⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠Amazon⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Airbnb⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠TSMC⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Alphabet⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ulta⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠LVMH⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Madison Square Garden Sports⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.
• Related ⁠books⁠ mentioned in the podcast.
• Ad-free episodes on our ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Premium Feed⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.

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