Lately, food delivery startup DoorDash has had a voracious appetite for capital.
Six months after closing a $250 million Series E, the Bay Area company is in talks to raise around $500 million from Temasek Holdings at a valuation of more than $6 billion, per The Wall Street Journal, roughly 10 times what DoorDash was worth four years ago.
Backed by investors including CRV, Sequoia, Coatue Management and DST Global, DoorDash had a strong 2018 when it came to VC funding, pulling in more than $780 million and achieving unicorn status in March, following a $535 million round led by SoftBank’s Vision Fund. Its valuation rose to $4 billion last August, following another $250 million fundraise.
DoorDash was founded in 2013 by a group of Stanford University students, including current CEO Tony Xu. The company has quickly grabbed a sizable market share and delivers food from restaurants to customers in more than 1,000 cities across the US and Canada. In January, it became the first food delivery startup to operate in all 50 states, per TechCrunch.
By now, it’s well-established that the growing trend of pondering a visually attractive menu online and ordering restaurant food from the comfort of your home is not going to fizzle out anytime soon. The global market for online food delivery is expected to reach $112 billion by 2023, according to Research and Markets, and competition in the space can be fierce.
One of DoorDash’s key competitors, food delivery unicorn Postmates, has also been grabbing headlines in the past week. Founded in 2011, the San Francisco-based company has hauled in plenty of capital as well, raising more than $670 million in VC funding overall, including a $100 million round in January from new investor BlackRock and a group of existing backers that includes Tiger Global. That latest round valued Postmates at $1.85 billion.