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The Spoon

Daily news and analysis about the food tech revolution

Uber Eats

Uber Eats’ Revamped App Aims to Make Restaurant Discoverability Easier

Uber Eats today unveiled a newly revamped app and website the delivery service says will improve restaurant discoverability. According to a company blog post, this digital makeover will roll out “over the coming weeks.”

The revamp will include a number of new features, several of which are designed to make the process of finding one’s desired cuisine and restaurant faster. A shortcut toolbar will feature a user’s favorite cuisine types as well as quicker access to grocery stores, pet supply stores, flower shops, and other businesses that are relatively new to the third-party delivery space. These “discoverability” tools also include a feature Eats has dubbed Hidden Gems, which surfaces local restaurants in a user’s neighborhood and recommend restaurants based on past orders.

Enhanced pickup options are the other feature Eats is highlighting with this redesign. The new app and website will include “visual cues” on the map so users can see which nearby restaurants offer pickup options. The map will also show restaurant ratings and local deals. Finally, a group orders feature lets users order from multiple restaurants at the same time through one single order.

Uber said in today’s blog post that after talking to users, the company realized that while ordering, checking out, and tracking meals via its app is simple and streamlined, actually finding a restaurant is a time-consuming task for many. The features announced today aim to minimize the time it takes to find, say, a local pizza spot with a reasonably good reputation and good quality food.

Of course, having to scroll through a gazillion restaurant listings to get dinner delivered is arguably not a real problem. But in the micro-world of third-party delivery services, speed and efficiency reigns, and Eats, Grubhub, Postmates, and DoorDash now regularly release new features meant to shave a few more seconds off the overall delivery app experience.

Among the major third-party delivery apps, August sales grew 158 percent year-over-year collectively, according to recent data from Second Measure. At the same time, though, the third-party delivery sector remains controversial. In particular, the sky-high commission fees they charge restaurants are seen as nothing short of predatory at a time when permanent restaurant closures are increasing because of the pandemic. Others worry that the restaurant industry meltdown will leave us in a world where the bulk of our restaurant options come from chains. Last time I checked, enhanced discoverability tools and better map features can’t fix that problem.

Ordrslip Adds Postmates Integration to Its Mobile App Software for Restaurants

Restaurant tech company Ordrslip announced today it has partnered with Postmates to add delivery integration into its mobile app software, according to a company press release sent to The Spoon. Per today’s announcement, Ordrslip’s software lets restaurant customers “create custom-looking whitelabel mobile ordering applications via Ordrslip.”

It’s no secret that, since the pandemic pushed the restaurant industry to off-premises formats, usage of mobile apps for ordering and payments is on the rise. It’s also pretty commonly known at this point that sophisticated apps a la Starbucks are far too expensive and resource-consuming for most independent restaurants and chains to create themselves. Hence the growing selection of tools (see below) various third parties offer to get restaurants the digital properties they need without decimating their already decimated margins.

The Ordrslip approach is this: Ordrslip creates a branded mobile app for the restaurant with all the features needed to fulfill pickup and delivery items, including order-ahead capabilities, payments, iOS and Android compatibility, POS integration (only with Square and Clover for now), and order tracking. You can read the full list of features here. The app looks and functions as if it belongs to the restaurant but is powered by Ordrslip’s softare in the background. As of today, there is the option to add Postmates integration in order to fulfill the last-mile delivery end of the operation.

The promise is that by using Ordrslip with the new Postmates integration, restaurant customers can bypass the controversial per-transaction commission fees they normally get charged by third-party delivery services. Ordrslip pricing is $100/month per location or $1100/year per location, with one-time setup fees of $1,000 and $750, respectively. (The setup fee applies to all locations a restaurant might operate.)  

On the one hand, those are high numbers for already struggling restaurants, which would have to be doing enough delivery to surpass $100/month in commission fees per transaction. On the other, there’s a pandemic happening and folks are staying at home and ordering more delivery. In other words, $100 in commission fees to Grubhub Et al is probably on the low end these days, though restaurants still have to pay some commission to Postmates for delivering the order.

Ordrslip is one of a growing number of companies offering restaurants workarounds to 30 percent commission fees on delivery orders. POS platform Toast, ChowNow, and many others have various tools in the market that let restaurants process orders and payments through a separate platform so they only need to use the delivery service for actual deliveries. Another company, ShiftPixy, bypasses delivery services altogether and provides the drivers itself. And even the delivery services themselves are participating in this trend. Uber Eats is piloting a tool that lets restaurants process orders through their own platforms, though Uber Eats retains the customer data.

Uber Eats also just announced its plans to buy Postmates for $2.65 billion, a deal that is expected to close in the first quarter of 2021. That deal is unlikely at this point to affect a partnership like the one Ordrslip announced today.

Uber Eats Adds Contactless Order and Payment Methods for Dine-In and Takeout

Uber Eats has turned on some new contactless ordering and payment methods according to a story out today in USA Today. The new “Uber Eats Contactless Order Feature” aims to reduce the amount of human-to-human contact for people dining in restaurants or picking up their food.

Customers can either scan a special QR code at participating restaurants or find the restaurant in the Uber Eats app to order and pay for meals. For those eating at the restaurant, the food will be brought out to your table. Those choosing takeout can schedule a time to pick up their food.

The food pickup option is available nationally starting today, and the food delivery to your table for dine-in customers is available at now in Indianapolis, Boston, Chicago, Philadelphia, Vermont, Atlanta, New York City and Washington, D.C.

Adding these types of contactless features is the latest in a series of moves Uber has made to adapt to the new normal caused by the COVID-19 pandemic. In addition to implementing contactless delivery, Uber also launched a pilot program that lets its restaurants accept pickup and delivery orders directly through their own websites with no added commission fee for the rest of the year, created a voucher program so companies can buy remote workers lunch during meetings, and developed a mask verification feature for its delivery drivers.

Uber is far from alone in adapting its product to support and accelerate a more contactless meal journey. In fact, any business that has any sort of relationship with a restaurant is getting into the contactless game. Holo Lens makes holographic interactive menus. Order for Me, BBot and even Apple are just three of the many companies with mobile payment solutions, while Keenon Robotics and Bear Robotics are creating robot servers to bring you your food.

As the pandemic continues, contactless payments and delivery will just become table stakes for any restaurant, and we are bound to see even more announcements like this from Uber and others in this space to accommodate.

Food E-Commerce Startup Dunzo Raises $28M

Bengaluru, India-based food delivery startup Dunzo has raised $28 million in what is the first tranche of the company’s Series E round. Entracker was first to report the news, noting that this round was led by Google and LGT Lightstone Aspada with participation from Lightbox, Bhoruka Finance Corporation, 3L Capital, Moving Capital, and Pivot Ventures.

The round follows Dunzo’s $45 million fundraise in October 2019 and brings the company’s total funding to $116.4 million.

Dunzo, which started as a WhatsApp group in 2014 to connect locals to grocery stores and restaurants, has over the years grown into a sizable e-commerce platform that delivers groceries, restaurant meals, and other supplies to customers around India’s major cities. According to Entracker, the company has about 75,000 stores on its platform.

It’s a lucrative, albeit highly competitive, time to be a food delivery startup, with the pandemic keeping more people at home and subsequently raising demand for online groceries and meal orders. Dunzo itself said in April it had seen a 3x increase in growth for food and beverage orders.

Though it’s hardly the only service in India that’s kept busy ferrying all manner of food goods to customers on lockdown. Both Swiggy and Zomato, the country’s major restaurant delivery services, have recently added grocery services. Both have also announced layoffs, too, underscoring the impact COVID-19 has had on business. The Indian food delivery market has also seen some consolidation: In March of this year, Zomato bought Uber Eats’ India business for  $206 million.

Like Swiggy and Zomato, Dunzo has been diversifying its business of late. Entracker reports that the company has recently invested in B2B services to “enable logistics for hyperlocal retailers.” It also currently runs 10 “dark stores” that help local retailers fulfill more orders.

Uber Eats Launches a Paid Advertising Tool for Restaurants

Uber Eats launched a new paid advertising platform today that claims to be “helping restaurants reach more customers,” according to a company blog post. Thing is, it doesn’t seem like it will be all that helpful for the bulk of independent restaurants. And it may in fact be the opposite, at least for the ones who do delivery with Uber Eats.

Here are the basics: Through the new service, simply dubbed Sponsored Listings, Uber Eats restaurant clients can pay to have their business name appear at the top of the app in relevant user searches. Restaurants can set up a Sponsored campaign through their Uber Eats dashboard, designating the intended audience (e.g., “new customers”) and a weekly budget spend. Restaurants pay an amount each time a customer clicks on their ad. (It varies from one restaurant to the next.) They can also start and stop their campaigns any time. 

Uber Eats says that the program is available to both chain restaurants and independents. Which leads us back to the debate around whether or not this new service will be of any actual value to most restaurants. 

We’re at a time in the history of the restaurant biz when paying for advertising is not top priority for the majority of businesses — many of whom are struggling to even keep the lights on. With paper-thin margins made even thinner by the shutdowns and reduced capacity mandates, pay-per-click advertising, even if it’s just $50 per week, is not always possible. Independent restaurants already typically pay more than chains in commission fees on Uber Eats.

At the same time, many chain restaurants, especially major QSRs, have managed to weather the pandemic (and even thrive during it), thanks largely to their built-in to-go formats. It’s safe to argue these restaurants could swing that $50 per week for paid advertising.

Looking at those two scenarios together, it seems like Uber Eats has created a situation in which smaller, independent restaurants will get pushed further and further down in listings because they can’t pay, making it difficult for customers to discover them and translating into lower sales overall for the business. It adds color to the nightmare I frequently have of living in a world where my only restaurant options are Panda Express and Chipotle.

Uber is at least acting cognizant of this. Along with today’s announcement about the Sponsored Listings launch, the company also said it will put $25 million towards “marketing credits” to “qualified US restaurants.” It made no mention of what qualifies a restaurant for the credits or now much credit a business can reasonably expect to get.

Of course, paying for better visibility is a basic business practice, and Uber Eats is hardly the first online service to run sponsored listings. (Been to Amazon lately?) This morning’s news just might have been a little more digestible if Eats had stuck to the basic facts. Instead, it’s positioned Sponsored Listings as a way of being helpful to businesses when the service will in all likelihood further drive a wedge between the haves and have nots of the restaurant biz.

Deliveroo and Waitrose Launch a 30-Minute Grocery Delivery Trial

Following similar recent moves from other third-party delivery services, Deliveroo is expanding its presence in the world of online grocery shopping. At the tail-end of last week, grocery chain Waitrose announced it will pilot a 12-week program with Deliveroo to get groceries to customers around the UK in as little as 30 minutes.

The news comes just as Waitrose’s longstanding deal with online grocery retailer Ocado comes to an end. From Tuesday, September 1, Ocado will instead deliver groceries from Waitrose rival Marks & Spencer. 

Deliveroo will ferry more than 500 Waitrose items to customers “in as little as 30 minutes,” according to the Waitrose press release. Customers will be able to place orders via Deliveroo from one hour after the shop opens to one hour before it closes. Waitrose says the partnership is meant to “compliment” its own two-hour grocery delivery service.

The Guardian noted over the weekend that Waitrose has seen more than 100,000 extra orders for online groceries since the UK’s pandemic-induced lockdown started. Online grocery orders across the UK have almost doubled thanks to the pandemic. It’s a similar story to what the U.S. is currently experiencing where grocery e-commerce sales hit $7.2 billion in June.

Given all that, it’s no surprise that third-party restaurant delivery services like Deliveroo are diversifying their sales channels to include grocery. Deliveroo, in particular, has struggled to keep business strong during the pandemic as restaurants shutter permanently. For example, the Competition and Markets Authority (CMA), the UK’s antitrust watchdog, finally approved Deliveroo’s long-scrutinized deal with Amazon on the grounds that Deliveroo would have had to exit the UK food delivery market without the Seattle giant’s investment.

Adding more grocery services is one way to make up for some of the lost restaurant sales. New sales channels may also give third-party delivery services a fighting chance a profitability, something that keeps getting eroded by fee caps, battles over worker classification, and other regulatory issues.

It’s a narrative we’re familiar with in the U.S., too. Uber Eats now delivers groceries, and DoorDash just announced its own grocery delivery service in addition to its partnerships with convenience stores.

The initial Deliveroo-Waitrose trial, which also starts September 1, will serve about half a million households and, if successful, will extend to more locations in the future.

Report: DoorDash May Go Public in 2020 Amid Broader Delivery Consolidation

DoorDash could file for an IPO as soon as the fourth quarter of 2020, according to “sources familiar with the matter” who spoke to Bloomberg.

The third-party delivery company is reportedly “taking steps” to go public in November or December of this year through a traditional IPO, rather than a direct listing, which the company had considered earlier this year.

The potential IPO comes at a time when the third-party food delivery sector is seeing a steady stream of mergers and acquisitions, from Just Eat Takeaway.com buying up Grubhub to the more recent deal from Uber to snap up Postmates for $2.65 billion.

DoorDash itself has largely stayed out of that M&A activity. The company acquired Caviar for $400 million about a year ago. Since then, DoorDash has been largely focused on diversifying its business. It launched its first ghost kitchen facility in October 2019. And since the start of the pandemic, DoorDash has teamed up with convenience stores like 7-Eleven, launched its own “ghost convenience store,” and, just last week, started an on-demand delivery [— LINK — ] service for groceries.

Those moves make sense in light of the fact that the restaurant industry has been one of the hardest-hit business types by the pandemic. Demand for third-party delivery may be up, but many restaurants — both independents and large chains — are closing down, which means DoorDash may need new lines of business to have a shot of being profitable (which, according to Bloomberg, it is not).

Like other restaurant third-party delivery companies, DoorDash is also navigating a substantial amount of controversy. In April, DoorDash, Grubhub, and others were the subject of a class-action lawsuit alleging third-party delivery companies used their market power to push restaurant prices higher during the pandemic. In June, the San Francisco DA sued DoorDash over worker misclassification, and if a ballot measure that would loosen restrictions over gig worker classification in California does not pass in November, DoorDash (and others) will face another threat to its chances for profitability. That’s to say nothing of commission fee caps, much-maligned tipping policies, and other gripes a growing number of the general public has against third-party delivery companies.

DoorDash was last valued at nearly $16 billion and, throughout the pandemic, has been an “essential service” more and more folks are using as the future of restaurant dining rooms remains uncertain.

Like everything else these days, the timeline for the company’s IPO could change based on, among other factors, the trajectory of the pandemic.

Uber Eats Is Not Bailing On California

California imposed an order this week that, for a minute there, led us all to believe Uber’s food delivery business in that state was on the rocks.

Spoiler alert: it’s totally not.

Recap: On Monday, a California judge issued a preliminary injunction ordering that Uber (along with Lyft) reclassify its drivers as employees in keeping with the state’s AB5, which was signed into law in January. Uber CEO Dara Khosrowshahi then took to the airwaves to tell us all the company will likely have to temporarily shut down service in California if the court does not overturn the ruling.

As is usually the case when we talk about third-party delivery services, there’s fine print, which Eater SF promptly dug up. An Uber spokesperson confirmed to the publication that the shutdown would only apply to the company’s rideshare business, and that Uber Eats — now Uber’s biggest business — would continue “as is.”

I can’t really think of a better way of putting it than in Eater writer Eve Batey’s own words: “Uber’s threat to take their ball and go home if forced to comply with California law really only applies to a ball that, right now, isn’t the one that the other kids want to play with all that much.”

Eats currently generates more revenue than Rides, according to Uber’s second-quarter earnings report. That makes sense, seeing as the world has been in a pandemic-induced lockdown of late, and even with restrictions lifting in places, average consumers are just not going out as much. They are, however, ordering a ton of delivery meals from restaurants. Gross bookings for Eats were $6.96 billion in Q2, which was up 113 percent year-over-year and up 54 percent over Q1 2020.

Uber also recently struck a $2.65 billion deal to acquire fellow third-party delivery company Postmates — a service that just happens to be number one in Los Angeles, a city that just happens to be the second most populated one in the U.S. Yanking the plug on California, even temporarily, would make the deal pointless. Uber might have ethical flaws in its business model, but its leaders aren’t dumb.

Besides, they’ll get a chance to continue the fight to keep its delivery drivers and couriers as contract workers come November, when Californians vote on Proposition 22, which would exempt rideshare and delivery drivers from being considered employees. Needless to say, tech companies are all-in on this one.

But if regulators continue to scrutinize third-party delivery practices, and consumers continue to rely on off-premises meals while restrictions around in-house restaurant dining room remain in place, it seems only a matter of time before Uber et al. go from the frying pan to the fire with food delivery. 

Maybe then we can take eloquently worded threats to shut down seriously. 

Accelerating the Drive Thru

Of late, there’s been much ado about the drive-thru, with major restaurant chains like Shake Shack and Chipotle all announcing an increased focus on the format.

So it wasn’t too surprising this week to get new data showing the drive-thru is far and away the most popular restaurant “experience” among consumers. A new survey from Bluedot and research firm SeeLevel HX found that 74 percent of respondents said they have visited the drive-thru “the same amount or more often than usual” compared to 43 percent in April. Those consumers surveyed also named drive-thru “the safest” of the to-go formats polled in the report.

It’s all a bit of a no-brainer if you ask me. If you’ve hung around inside a restaurant lately waiting for your pickup order, you’ll know the experience is often tense and confusing. Meanwhile, curbside pickup is still so new for most restaurants that operational kinks have yet to be worked out. That makes drive-thru, a decades-old format, seemingly the safest and fastest way to collect your grub at a time when dining at a restaurant is a no-go for many consumers.

But drive thrus could be faster. A lot faster. In this week’s survey, 81 percent said waiting more than 10 minutes in the drive-thru is too long.

As mobile ordering increases in restaurants and more chains reformat their brick-and-mortar locations to accommodate drive-thru, speed of service will need to be at the top of the priority list.

Restaurant Tech ‘Round the Web

  • A new survey by Oracle Food and Beverage found that 59 percent of U.S. consumers and 47 percent in the U.K. “plan to dine-out as soon as they are able.” Forty percent in the U.S. and 39 percent in the U.K. would feel “safer” using a digital menu from their own device. Another 35 percent in the U.S. and 31 percent in the U.K. had similar feelings about digital payments. 
  • Mobile platform Mad Mobile has acquired restaurant tech company CAKE, best known for its POS system. Mad Mobile hopes to use the acquisition to create a next-gen POS designed for mobile-first restaurant experiences. 
  • For more on the future of ridesharing, which is usually an indicator of what’s to come for food delivery, check out this podcast from Axios Re:Cap. 

This is the web version of our newsletter. Sign up today to get updates on the rapidly changing nature of the food tech industry.

Are Food Delivery Services ‘Violating’ Mandatory Fee Caps in NYC?

NYC regulators are demanding stricter oversight of the recently mandated caps on delivery commission fees, according to the NY Post. NYC Councilman and head of the small business committee Mark Gjonaj this week urged Mayor De Blasio’s Office of Special Enforcement to fine the offending parties (i.e., the delivery services) found to be violating the fee caps.

Which is apparently happening. At a hearing this week, OSE’s executive director Christian Klossner said his office had received two complaints from restaurants that were charged more than fee caps allowed by the delivery companies. Klossner said the companies (unnamed) had refunded the money, but Gjonaj demanded the OSE “consider fining the offending company.” 

Two restaurants isn’t a lot, but Gjonaj, seems to suggest the actual number of businesses being overcharged could be bigger. Speaking at the hearing this week, he said, “If these companies have done it to one restaurant, it must be widespread.”

While not proven, that point wouldn’t exactly surprise, since third-party delivery services have disregarded legislation before, most notably around worker classification. Fee caps are so new on the third-party delivery regulatory front that there hasn’t been much time for companies to flout the rules, or for restaurants to make known that they’re being overcharged. Part of Gjonaj’s call over more enforcement of the caps seems aimed at bringing any violations into the light. “How are you getting the word out to the thousands of businesses that they need to bring this to your attention?” he asked attendees at this week’s hearing.

Like a growing number of U.S. cities, the Big Apple imposed mandatory fee caps on commission fees at the peak of shelter-in-place mandates brought on by the pandemic. The aim of those fee caps is to help restaurants, who normally fork over as much as 30 percent per transaction to third-party delivery companies in commission fees. Needless to say, those commission fees were gutting the already decimated restaurant industry, hence caps imposed by NYC, San Francisco, Los Angeles, Baltimore, and many others. 

Those fee caps are for the most part meant to endure only as long as cities remain in emergency states around the pandemic. Soon enough, though, these cities will have to weigh the ups and downs of mandating — and enforcing — the caps over the long term, along with other measures that can better protect restaurants in a delivery-crazed world. 

Uber Q2: Eats Generates More Revenue than Rides

There are two stories coming out of Uber’s Q2 earnings report today. The first is the straight ahead numbers: The company did $2.18 billion in revenue for the quarter, which was down 29 percent year-over-year, but beat analyst expectations. Uber’s net losses were $1.8 billion, narrower than the $2.94 billion in Q1.

Of course, much of this was due to the fact that the COVID-19 pandemic has hit the company’s mobility business. Uber’s mobility division had gross bookings of $3.046 billion for the quarter, which was a decline of 73 percent year-over-year. With people on lockdown, they had no need to hail a ride.

But while the coronavirus kept people from catching an Uber across town, it also pushed them to ordering more food delivery while they stayed home, which leads us to the other story.

Gross bookings for Uber’s delivery business (Uber Eats) hit $6.96 billion in Q2, which was up 113 percent year-over-year and up 54 percent over Q1 2020. That’s a lot of french fries delivered to people’s front doors.

In addition to getting a pandemic push, Uber Eats also streamlined some of its costs in Q2. The company ceased Uber Eats operations in eight different markets around the world where it wasn’t in a leading position.

In the Q2 earnings release, Uber also said that it now has more than 500,000 partnered restaurants on the platform, a 50 percent jump year-over-year.

With Q2 in the books, it’s time to look ahead to Q3 which will include the $2.65 billion all-stock purchase of rival food delivery service, Postmates, as well as the expansion into grocery delivery here in the U.S.

Uber Eats’ New Pilot Offers Commission-Free Orders for Restaurants, with a Catch

Today, Uber Eats launched a pilot program that lets its restaurant parters accept pickup and delivery orders directly through their own websites with no added commission fee for the rest of 2020. 

The program seems to be a bid on Uber Eats’ part to keep restaurant partners entrenched in the third-party delivery service’s ecosystem by offering them the option to process orders via their own digital properties. The catch (because there’s always a catch) is that Uber Eats still powers those orders. The Uber Eats site clearly states that with this new program, restaurants will “leverage best-in-class Uber Eats feature and powerful technology to fulfill orders.”

That brings up a whole host of questions around customer data, which we’ll get it shortly.

First, it is worth noting that Uber Eats is waiving commission fees on delivery and pickup orders placed through one of these sites through the end of 2020 (restaurant still pay a 2.5 percent processing fee). The exorbitant commission fees third-party delivery services charge restaurants — as high as 30 percent per transaction in some cases — has been by far the biggest grief restaurants and restaurant advocates have voiced over the last year. The pandemic cranked the volume on that conversation up so high that many cities have introduced mandatory caps on these fees for the time being. The general argument is that restaurants are getting decimated by coronavirus restrictions, and asking an indie restaurant barely surviving to pay 30 percent of each order to a delivery company is a spoonful of salt in an already pretty grievous wound. 

In the short term, a program like Uber Eats’ could give restaurants a much-needed boost when it comes to building out an off-premises strategy that won’t financially gut them at the same time. 

The cost, however, looks to be data. As noted above, Uber Eats is still powering these transactions, which means it ultimately controls access to the data on customers. In fact, a fine-print note buried at the bottom of the new program’s site states that a “restaurant can access customer data subject to opt-in from customer during checkout.” What’s unclear is if that opt-in will be an easy-to-see feature on the consumer-facing app — and if customers would actually use it. We have reached out to Uber to get clarification on this.

Uber Eats sort of addressed this by also announcing today the release of its mobile app for restaurant managers and customer engagement tools. Per the blog post, both of those things helps restaurant managers track sales, respond to customer feedback, and get other insights about customer behavior. 

Like I said before, all of these things could very well help struggling restaurants right now, many of whom never offered off-premises before the pandemic and are now having to learn as they go when it comes to running a delivery and takeout business.

Longer term, however, getting locked into Uber’s ecosystem so thoroughly will limit the amount of control restaurants have over their own data and ultimately their customer relationships. 

Uber to Acquire Postmates for $2.65B

Uber has agreed to acquire Postmates in a roughly $2.65 billion all-stock transaction, according to a press release from Uber. The deal is expected to close in the first quarter of 2021.

Uber first made the offer to buy Postmates at the very end of June, after a failed attempt to snap up Grubhub. According to sources close to the matter that spoke to Bloomberg, the two companies have actually been in talks on and off for about four years. 

The boards of both Uber and Postmates have approved the transaction, which is still subject to the approval of Postmates shareholders and also any regulatory approvals. Uber said in the press release today that it will keep the consumer-facing side of the Postmates app running separately from its Eats app, “supported by a more efficient, combined merchant and delivery network.” 

Acquiring Postmates would give Uber a larger presence in certain key markets, like Los Angeles, where Postmates is the leading third-party delivery app. In the past, Uber has said it will pull out of markets where it is not the number one or number two player.

Today’s deal is another piece of evidence that third-party delivery is consolidating fast. Grubhub itself was acquired by the newly formed Just Eat Takeaway.com in June. Elsewhere, Delivery Hero recently bought South Korean service Woowa Bros. for $4 billion and Brazil-based iFood announced a merger with Colombian delivery heavyweight Domicillios.com.

Notably, DoorDash, which is still the U.S. leader in terms of marketshare for third-party delivery, has not come up in this M&A flurry. At last check, the company secured an additional $400 million in funding. It filed to go public in February and still plans on a listing for 2020.