It relies on marketing and beta tests, which include free and discounted food, in new markets to introduce its food to customers. "But they're not able to control quality."ĬlusterTruck lacks the name recognition of GrubHub's partners. They're a great company and they're doing very well," Baggott said. It's about the service," Maloney said on CNBC. "And the only thing we do is we connect diners to their restaurants."īaggott, though, said such partnerships create an extra layer of separation from the customer. "People want to connect with their restaurants. Maloney said GrubHub's advantage is that it delivers food from existing restaurants that already have loyal customers. GrubHub CEO Matt Maloney claimed in an interview with CNBC that other food delivery startups have "wasted" billions of dollars trying to catch up with GrubHub, which has more than 75,000 partnerships with restaurants. The company's stock price has risen from $37.06 at the beginning of the year to $72.22 as of Dec. GrubHub had a $2 billion valuation at the time of its 2014 initial public offering. Japan-based SoftBank recently reached a deal to invest $300 million in DoorDash, according to Recode. Uber Eats already has grown into a $3 billion business, according to a document leaked to The Financial Times, and the service has outgrown Uber's original ride-hailing business in some markets, according to a report in Business Insider. "So, as they deliver one order per delivery, high integrity of the food, too."ĬlusterTruck does not deliver food on behalf of any other restaurant.įor now, ClusterTruck's competitors are much larger and have more money. "We're seeing some significantly higher checks, but we're also seeing a great partner in DoorDash getting deliveries to the consumer in less than 30 minutes from the time they order," Penegor said. Wendy's CEO Todd Penegor said during a November earnings call that customers have given his chain high ratings on the DoorDash service. Wendy's, for instance, is partnering with San Francisco-based DoorDash to deliver food from 2,500 of its locations. Some chains have been able to tap into the growth of delivery dollars. Inexperience with delivery has forced many restaurants to partner with third-party services - ClusterTruck's competitors - with mixed results. Long-established restaurants, with the exception of pizza chains, generally are not well equipped to capitalize on this trend. American spend a lot of money eating out." "The good news for (Baggott) is food is a massive market.
"I think they can keep expanding pretty quickly," Dale said. Food-delivery sales are on pace to grow from $30 billion today to $220 billion by 2020, according to a July report from Morgan Stanley. People love eating outĬlusterTruck is tapping into a surging demand for delivery across the U.S. "The business model is working very well and we want to scale as quickly as possible," Baggott said.
By the end of next year, Baggott expects to operate in between 10 and 20 cities, including Charlotte, Minneapolis, Atlanta and Fort Worth, Texas, where the company already has signed leases. If we want to stop growing and start squeezing margins, we will be very profitable, but at this point in our existence it's all about growing."ĬlusterTruck has reported raising more than $30 million from investors since May 2015, according to Security and Exchange Commission filings, but the total is likely greater than that. Baggott's track record suggests his projections - whether it's a revenue target or becoming a global brand - have some basis in reality.ĬlusterTruck has expanded to about a half-dozen markets, including Bloomington, Denver and Columbus, Ohio. That's what our investors are hiring us to do. "Our goal is to grow as fast as possible. "We're a high-growth, fast-growing startup," Baggott said. ClusterTruck is not profitable, but Baggott said it could be if that were the goal. He declined to disclose details of the company's financial performance to IndyStar. 'Our goal is to grow'īefore ClusterTruck launched in April 2016, Baggott said it would become a $1 billion business. That's because those companies mostly deliver food from partner restaurants, an extra step that adds complexity and time to the process. Customers are required to meet drivers, or in some cases bicyclists, at their curb to save time.ĬlusterTruck has differentiated itself by delivering food faster and fresher than competitors such as GrubHub, DoorDash and Uber Eats.
Clustertruck controls driver#
ClusterTruck's platform sets a schedule for each item to be made and handed off as the driver arrives. Once a driver accepts the order, the monitors that hang along the kitchen indicate that it's time to start cooking.
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