DoorDash

Grab

DoorDash

DoorDash operates a three-sided marketplace connecting restaurants, delivery drivers (Dashers), and consumers. Revenue comes from three streams: commissions charged to restaurants (typically 15-30% of the order value), delivery fees and service fees charged to consumers, and DashPass subscription revenue ($9.99/month for free delivery and reduced fees).

The DashPass subscription is the retention engine. Over 18 million subscribers pay monthly whether they order or not, creating predictable recurring revenue.

Subscribers order more frequently (about 4x more than non-subscribers), increasing order volume.

Advertising is the emerging high-margin business. Restaurants pay for promoted listings and sponsored placements in the app.

This is essentially a search advertising business built on top of a logistics network. Ad revenue has grown to over $1 billion annually — and it's nearly pure profit because it costs almost nothing to display an ad.

Grab

Grab operates a super-app model — one app that handles rides, food delivery, grocery delivery, package delivery, digital payments, insurance, lending, and investments. Revenue comes from commissions on each transaction across all verticals, plus financial services revenue from GrabFin (digital banking, lending, insurance).

The ride-hailing business is the foundation — Grab takes 20-25% of each ride fare. Food delivery (GrabFood) follows the same marketplace commission model as DoorDash or Uber Eats.

GrabMart handles grocery and convenience delivery.

The financial services segment is the long-term play. Grab has digital banking licenses in Singapore, Malaysia, and Indonesia.

In a region where 70% of adults are unbanked or underbanked, providing basic financial services through the same app people use to order rides is a massive opportunity. GrabPay processes billions in transactions annually.

The lending arm provides small business loans to merchants on the Grab platform.

DoorDash

Tony Xu grew up watching his mother work multiple restaurant jobs after the family immigrated from Nanjing, China to Illinois. She washed dishes, waited tables, and cooked — sometimes all in the same week at different restaurants.

That experience gave Xu an unusual understanding of how brutally hard the restaurant business is.

At Stanford in 2012, Xu and classmates Stanley Tang, Andy Fang, and Evan Moore were in a startup class looking for a business idea. They interviewed over 200 small business owners and kept hearing the same problem: restaurants wanted to offer delivery but couldn't afford to hire drivers.

Domino's and Pizza Hut had fleets. Your local Thai place didn't.

Their solution was comically low-tech. They built a one-page website called PaloAltoDelivery.com, listed menus from local restaurants (without asking permission), and put their personal phone numbers on the site.

When orders came in, they drove the food themselves. The first order was pad thai from a restaurant in Palo Alto.

Within months, they were drowning in orders and realized this was a massive business. They incorporated as DoorDash in January 2013 and got into Y Combinator that summer.

Grab

Anthony Tan grew up in Malaysia as the grandson of the founder of Tan Chong Motor, one of the country's largest car distributors. Despite the family business, he was obsessed with the problems of Southeast Asian transportation.

Taxis in Malaysia were notoriously unreliable — meters were broken, drivers refused short trips, and women felt unsafe riding alone.

At Harvard Business School in 2011, Tan and classmate Tan Hooi Ling (no relation) entered a business plan competition with an idea for a taxi-hailing app adapted for Southeast Asia. They didn't win.

But they built it anyway.

MyTeksi (later renamed Grab) launched in Malaysia in 2012 as a taxi-hailing app. The key insight was that Southeast Asia needed a fundamentally different approach than Uber.

The region has 700 million people across 11 countries, each with different languages, currencies, regulations, and transportation norms. In Indonesia and Vietnam, motorbikes outnumber cars 10 to 1.

In the Philippines, cash is king — credit card penetration is under 5%. Grab built for these realities from day one.

They added motorbike rides (GrabBike), cash payments, and local-language support before Uber even thought about them.

DoorDash

DoorDash won the US market through obsessive focus on suburban and mid-market restaurants — the segments Uber Eats and Grubhub ignored. While competitors fought over Manhattan and San Francisco, DoorDash was onboarding every Chinese restaurant and pizza shop in Tucson and Des Moines.

By the time competitors noticed, DoorDash had locked up the majority of US restaurants.

The "last-mile logistics" expansion is the long game. DoorDash now delivers groceries (partnerships with Albertsons, Rite Aid), convenience items (DashMart dark stores), alcohol, pet supplies, and retail products.

The thesis is that once you have a network of drivers and a consumer habit of ordering through an app, you can deliver anything — not just food.

The Wolt acquisition for $8.1 billion in 2022 was the international play. Instead of grinding through country-by-country expansion, DoorDash bought the leading delivery platform in 23 countries across Europe and Asia.

Wolt brought strong unit economics and a beloved brand, especially in the Nordics.

Grab

Grab's growth strategy was hyperlocal execution at continental scale. Each country in Southeast Asia is effectively a different market with different regulations, languages, payment preferences, and transportation norms.

Grab built separate operations in each country with local teams who understood the nuances.

The Uber war was defining. From 2014 to 2018, Grab and Uber fought a brutal subsidy war across Southeast Asia, spending billions on driver incentives and rider promotions.

Grab's advantage was local knowledge — they had motorbike rides, cash payments, and government relationships that Uber lacked. In March 2018, Uber surrendered entirely, selling its Southeast Asian operations to Grab in exchange for a 27.5% equity stake.

It was one of the most decisive wins by a local champion over a Silicon Valley giant.

The super-app strategy creates a flywheel. A user who orders rides on Grab starts using GrabFood, then GrabPay, then GrabFin products.

Each new service increases the time spent in the app and the switching costs. In Southeast Asia, where most people only have one or two apps for daily services, being that app is everything.

DoorDash

Profitability has been the constant question. DoorDash lost money every year through its IPO and beyond, finally turning consistently profitable in 2023.

The food delivery business has razor-thin margins — restaurants want lower commissions, drivers want higher pay, and consumers want lower prices. Squeezing profit from that three-way tension is incredibly hard.

Regulatory risk is real and growing. Cities and states have capped delivery commissions (New York City caps at 15% for delivery, 5% for marketing).

Worker classification lawsuits keep coming — are Dashers employees or independent contractors? California's Prop 22 temporarily settled this for California, but the debate rages everywhere else.

Each new regulation shaves margin.

Uber Eats is the forever competitor. Uber's massive ride-sharing network gives them built-in driver supply and brand recognition.

They're willing to lose money on Eats to keep their broader ecosystem sticky. DoorDash and Uber Eats together control about 90% of US delivery, and neither can afford to cede ground.

Grab

Profitability has been the constant struggle. Grab went public via SPAC in December 2021 at a $40 billion valuation and proceeded to lose over $1.7 billion in 2022.

The stock price crashed over 70% from its SPAC debut. The company finally achieved quarterly profitability in Q3 2023, but sustaining it across 8 countries with different economic conditions is incredibly hard.

Competition is fierce on every front. GoTo (the merged Gojek-Tokopedia entity) is the arch-rival in Indonesia, the largest market in the region.

Shopee (owned by Sea Group) competes in food delivery and payments. Regional and local players challenge Grab in every country.

Running a super-app means competing with specialists on every front simultaneously.

Regulatory complexity across 8 countries is a nightmare. Each country has different rules on ride-hailing, food delivery, digital banking, and data privacy.

Indonesia banned motorbike ride-hailing apps for a while. Vietnam requires data localization.

Singapore has strict fintech regulations. A regulatory change in any single country can blow a hole in quarterly results.

DoorDash

DoorDash Marketplace — the core food delivery platform connecting consumers to 390,000+ restaurant partners across the US, Canada, Australia, Japan, and Germany. DashPass — a subscription program offering $0 delivery fees and reduced service fees for $9.99/month.

The loyalty engine of the entire business. DoorDash Drive — a white-label delivery service that lets any business (not just restaurants) use DoorDash's driver network to fulfill their own orders.

Basically DoorDash as a logistics API. DoorDash for Business — a corporate platform for team meals, employee benefits, and office food programs.

Wolt — the European food delivery platform DoorDash acquired for $8.1 billion in 2022, now the company's international expansion vehicle.

Grab

GrabRide — ride-hailing across cars, motorbikes, and taxis in 8 Southeast Asian countries. GrabFood — food delivery service and the market leader in Southeast Asia, operating in over 500 cities.

GrabPay — a digital wallet and payments platform used by millions for in-app payments, peer-to-peer transfers, and in-store purchases. GrabFin — financial services including digital banking (via digibank licenses), micro-lending for drivers and merchants, and insurance products.

GrabMart — grocery and convenience delivery, including dark store operations for rapid delivery.

DoorDash

Sequoia Capital has been the most consequential investor, leading multiple rounds and backing Tony Xu from Y Combinator onward. Khosla Ventures, Kleiner Perkins, and SoftBank Vision Fund participated in growth rounds.

Y Combinator was the starting point (Summer 2013 batch). The December 2020 IPO raised $3.4 billion at a $39 billion valuation, making it one of the biggest tech IPOs of that year.

Grab

SoftBank Vision Fund has been the largest and most influential investor, deploying billions across multiple rounds. Didi Chuxing (China's ride-hailing giant) invested strategically.

Toyota invested $1 billion for mobility partnerships. Microsoft, Booking Holdings, and Uber (via the 2018 deal) are significant shareholders.

GIC (Singapore's sovereign wealth fund) and Temasek invested in later rounds. The SPAC merger with Altimeter Growth Corp in December 2021 valued Grab at approximately $40 billion.