Once upon a time, DoorDash was a spoke on a big wheel of restaurant ordering channels. These days, it is starting to look more like a hub.
That’s our biggest takeaway after a pair of acquisitions by the delivery company that have it set to take a bigger share of the restaurant tech ecosystem.
Last month, DoorDash announced plans to acquire reservations and marketing service SevenRooms for $1.2 billion in a deal that officially closed last week. SevenRooms will add new tools to DoorDash’s restaurant software suite, the Commerce Platform. It will allow DoorDash to help restaurants grow their on-premise business by turning reservations data into targeted marketing opportunities.
Then last week, DoorDash revealed that it had acquired Symbiosys, an ad tech startup that will allow restaurants to advertise themselves on places like Google, TikTok, Instagram and Snapchat. The ads will direct back to a restaurant’s DoorDash ordering page, or, in the future, a white-labeled DoorDash website, or possibly a reservations page powered by SevenRooms.
To put it simply, DoorDash wants to do a lot more than just handle deliveries.
“Ultimately, we want merchants to be able to do their business both online with us, with the marketplace, as well as power their own interfaces, power their own in-store experiences as well,” said CFO Ravi Inukonda during the J.P. Morgan Global Technology, Media and Communications Conference last month, according to an AlphaSense transcript. He added that there is “a lot of opportunity” for DoorDash to keep growing its B2B business.
It’s not clear just how large that business is today. The company generated total revenues of $10.7 billion last year. It has not disclosed the size of the Commerce Platform business. But last week, it revealed that DoorDash Ads reached a $1 billion annual revenue run rate in 2024.
The company says its goal is to grow local economies and refers to itself as a “local commerce platform.” Besides driving traffic to restaurants through its consumer-facing delivery marketplace—the largest in the U.S. by market share—DoorDash is now also a one-stop shop for white-label delivery, takeout, ordering, marketing, reservations and advertising.
“At the end of the day, if you bring it all together, what we’re trying to do is become a de facto growth partner for these restaurants,” Vassili Samolis, head of product for DoorDash ads, said in an interview last week.
It sounds appealing: What restaurant would say no to growth? Apparently not many. DoorDash’s ads business, which today consists of promotions and sponsored listings within its app, boasts an 85% month-over-month retention rate, Samolis said.
“I think that is a very strong testament to the fact that we’re creating value, because if we were not, people would turn it off,” he said.
At the same time, the company’s ever-widening net should give restaurants some pause.
Many operators already view third-party delivery as a necessary evil. The service is less profitable than other channels, and restaurants don’t control the data or the experience once the food leaves the building. But tens of millions of consumers use apps like DoorDash and Uber Eats every month, enough to force even longtime holdouts like Domino’s and Olive Garden to take the plunge.
The general playbook for restaurants has been to use delivery apps to attract new customers, and then try like hell to get them to order directly next time. This has historically been an uphill battle, though there have been signs of progress recently.
But now DoorDash is stepping into some of those direct ordering channels, too. By adding reservations and advertising, DoorDash will have a hand in even more restaurant-customer interactions, siphoning off more money and data from operators while also leaving them with fewer alternative options. Meanwhile, thanks to Symbiosys, operators will now be competing with restaurant-subsidized DoorDash advertisements all over the internet.
It’s as if every step a restaurant takes, DoorDash wants to be there. From one angle, it looks like helping; from another, hunting.
Neither view is 100% true. DoorDash will only survive long-term if restaurants do. It has scale and data and a massive audience to put to work for its restaurant partners. And yet its interests as a giant, publicly traded company won’t always align with those of the small local businesses that it is seeking to help.
And ultimately, all the hand-wringing might be moot. Because if DoorDash keeps going at this rate, it may just become inevitable.