Earlier this year the failure of few food delivery startups led to a number of pundits and articles claiming that the on-demand economy was in trouble.
Examples include TechCrunch's SpoonRocket shuts down amongst on-demand apocalypse and Bloomberg's Food-Delivery Startups Head for Shakeout as Venture Money Slows.
And to be fair, a number of food delivery startups have failed. But that's how the startup world works. Some startups make it and most fail.
But it's clear that despite what you might read, on-demand food delivery as a business continues to grow at a very rapid clip.
A good example is the the recent earnings report by the former startup and public food deliver company Grub Hub. Their stock soared 26% after reporting much better than expected earnings on $120 million in quarterly revenue (disclosure: I'm a Grub Hub shareholder).
Another sign pointing to growth is the entrance of larger firms. Uber is rolling out its UberEats service in the U.S. and abroad, Amazon is testing their food delivery service and even Walmart is playing around with food delivery.
Business Insider's FOOD WARS: We tried 7 different delivery services to see who would bring us the best lunch points out that:
In the US, analysts estimate that only 10% of restaurants take online orders. That means there's 90% of the market left to conquer, which has created a gold rush of companies trying to cash in.
The chart below from the Business Insider article shows the market shares of the major food delivery companies.
And venture capital continues to flow into this sector. For example, last week European food delivery company Deliveroo announced it raised a $275 million round.
TechCrunch says they need the money because Uber is eating into their market.
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