The purchase of food delivery app Caviar by competitor DoorDash has been hailed by chief executive Tony Xu as “another important step forward on our mission to empower local economies”.
DoorDash recently announced that it agreed to acquire Caviar for $410 million in a cash and stock deal. As a result of the transaction, DoorDash will be able to expand its last-mile logistics platform to include Caviar’s premium restaurants and complimentary geographic footprint.
Tony Xu, CEO of DoorDash, said:
“Today’s announcement is another important step forward on our mission to empower local economies. We have long-admired Caviar, which has a coveted brand, an exceptional portfolio of premium restaurants and leading technology.
“The acquisition further enhances the breadth of our merchant selection, enabling us to offer customers even more choice when they order through DoorDash.”
The deal also strengthens the existing partnership between DoorDash and Square, the mobile payment platform created by Twitter CEO Jack Dorsey, which has owned Caviar since 2014.
The transaction further consolidates the competitive delivery market as DoorDash goes up against the likes of UberEats, Postmates and GrubHub in the US. According to analytics company Second Measure, DoorDash was responsible for 34% of all US meal delivery sales in July.
In estimates published last month by research firm eMarketer, food delivery apps are now used by 38 million people in the US. Usage of Uber Eats, DoorDash, Grubhub and Co is estimated to climb to over 44 million people by 2020, hitting 60 million US smartphone users in 2023.