David Rosenthal: evaluation

Transcript context

…It's really interesting thinking about, and much ink has been spilled on this concept but I think it's really worth diving into here. Intuitively, you would think launching in the cities is better because there's much more density. It's been working in New York for a long time. People really value convenience there. It's the convenience economy. People have lots of disposable income. What that meant was number one, they don't have any competition in the suburbs in terms of other mechanisms of delivery. Number two, drivers were much easier to come by in the suburbs because everyone has a car, whereas in cities, 10%–15% of people have a car so there's much more available Dasher supply. On top of all of that, there's no traffic and parking is not an issue. You can actually deliver a higher quality of service at a lower price point with greater supply of Dashers. There are all sorts of reasons why it was actually great to be out there, and they had a wide-open lane to themselves because these incumbents weren't playing there at all. That's the thing. One of DoorDash's core values—usually, core values are a bunch of baloney, but in this case, I think actually makes sense—is operating at the lowest level of detail. Tony talks about this. Yeah, in cities you got this density, but think about what that means. This is not ridesharing where you pull up to the curb, somebody gets in, and you drive off. You pull up to the curb, you got to park, you got to get out, you got to go get the order. If you're getting the order at the restaurant and there's a queue, you have to wait in the queue and then get the order. Then you got to go drive and then you got to drop it off. You might have to be dropping it off at the 12th floor, apartment building. In New York, this can work okay because couriers are on bicycles. As we'll talk about later, DoorDash did really embrace different forms of vehicles for dense cities. But in the early days, in San Francisco, you're going to bike around and do this? No, you need cars and motorcycles. Yeah, this 'operate at the lowest level of detail' thing is really one of the things that makes this company special. The quote is, "Averages in our industry are meaningless. It’s the distribution that matters. No consumers care if our average delivery time is 35 minutes if they received their food in 53 minutes." It's such a great point. It's a very Amazonian way of looking at it where you're obsessed with every customer on an individual basis rather than welled-up metrics. For this business in particular, one bad experience, you could lose trust and never rely on them to deliver your dinner again especially if you have company over, you're really hungry, or whatever the thing is. You can blow it with one bad customer experience.…

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