Streaming video on demand services are not the only subscription services vying for market share. Food delivery services like DoorDash, Uber Eats, Grubhub and Postmates are trying to “one up” each other. In its next stage of growth, DoorDash announced last week that it has confidentially submitted a draft registration with the Securities and Exchange Commission to go public. The company did not indicate, however, how many shares it might sell, for what price or when it might go public.

The request for an initial public offering will be reviewed by the SEC and is subject to the market and other conditions. The IPO is being underwritten by Goldman Sachs. According to CNBC, DoorDash raised $700 million in a Series G funding round that ended in November. At that time, the company was valued at approximately $13 billion. Crunchbase reports that investors include SoftBank Vision Fund, T. Rowe Price, Temasek Holdings, Sequoia Capital, Sands Capital Ventures and Dragoneer Investment Group, among others.

The New York Times, however, reports that the company lost an estimated $450 million in 2019. They also reported of other troubles that have plagued DoorDash, including fighting a new freelancer-gig economy law in California that would reclassify independent contractors as employees. Such a change could cost DoorDash, its competitors and companies like Uber and Lyft a lot of money down the line.

How does DoorDash stack up to its competitors? Looking at January 2020 sales data, as reported by Second Measure last month, DoorDash and GrubHub are the top meal delivery services in terms of monthly sales:

• DoorDash – 38%
• GrubHub, including Seamless and Ear24 – 31%
• Uber Eats – 20%
• Postmates – 10%
• Other – 2%

Postmates filed for an initial public offering in February 2019, but has not yet moved forward with it.

Grubhub is running a close second to DoorDash. Yesterday we reported on Grubhub’s new free delivery service, Grubhub+. Like DoorDash, Grubhub offers a free food delivery subscription service for $9.99 a month. Free delivery applies to orders of $12 or more. Grubhub has upped the ante a bit though. As part of its subscription service, subscribers can earn 10% cashback for every $100 spent in a customer’s first 30 days, and they get the opportunity to donate their change to No Kid Hungry. Grubhub has offered to match those donations. In addition, Grubhub will give subscribers of other food delivery services a free month if they show proof of subscription. This is a limited offer, however. The Grubhub+ subscription itself is very similar to other meal delivery services. It is the extras that set it apart from DoorDash and other competitors.

Insider Take:

The timing of a preliminary IPO filing is interesting. Right now, the global economy is volatile as uncertainty around the coronavirus and the U.S. political climate change on a daily basis. DoorDash is likely setting the stage and testing the waters for what it hopes will be a strong showing once officially listed as a public company. With a $13 billion valuation, the company holds a lot of promise, but it needs to reverse its losses to satisfy its investors. Despite many things going in its favor, DoorDash has a way to go to convince Wall Street that they are a risk worth taking.