Thread by @ZGoldstein

Some analysis / quotes from the @Uber #S1 re: #UberEATS

For starters, while @UberEats fleeces restaurants w/ high take rates, "cumulative payments to Drivers for deliveries historically have exceeded the cumulative delivery fees paid by consumers." /1

sec.gov/Archives/edgar…

2/ They openly acknowledge directly competing w/ restaurants: "@UberEats offering competes with restaurants, meal kit delivery services, grocery delivery services, and traditional grocers" & "we estimate TAM to be the entire $2.8 trillion consumer spend at retail restaurants."

3/ Restaurants should worry about delivery customer experiences: "With Drivers who are only eligible to make deliveries through @UberEats, our qualification and background check standards are less extensive than the standards for Drivers eligible to provide rides."

4/ This is how they sleep at night: "@UberEats provides restaurants with instant mobile presence and efficient delivery capability, which we believe generates incremental demand and improves margins by enabling them to serve more consumers w/o increasing front-of-house expenses."

5/ Key words: "we believe". Major restaurants like @habitburger are not as convinced. nrn.com/fast-casual/ha…

6/ Good news though: "If spending at many of the restaurants in our network declines, or if a significant number of these restaurants go out of business, consumers may be less likely to use our products and offerings, which could harm our business and operating results."

7/ ☝️that means there is some self-awareness that if they drive restaurants out of business, they could inadvertently "kill the golden goose"... or drive all food experiences to so-called "dark kitchens" which isn't a world I personally want to live in. Not sure about you.

8/ A glimmer of hope for restaurants that @Uber may "play nicer" than @Grubhub? "Our Uber Eats Take Rate has declined in recent periods, and may continue to decline, as we onboard large-volume restaurants at a lower service fee."

9/ Because it's a LOT of $$$ already captured: "@UberEats grew to $2.6 billion in Gross Bookings for the quarter ended December 31, 2018"

10/ Correlation not causation. But still impressive / problematic for @lyft w/o food delivery: "Consumers who used both Personal Mobility and Uber Eats had 11.5 Trips per month, compared to 4.9 Trips per month for consumers who used a single offering."

11/ @McDonalds exclusive, while driving orders, is undoubtedly BIG $$ loser for @Uber: "we charge a lower service fee to certain of our largest chain restaurant partners on our @UberEats offering to grow the number of consumers, which may at times result in negative take rate"

12/ No doubt @McDonalds is huge: "A significant amount of Gross Bookings come from a limited number of restaurant chains, and this concentration increases the risk of fluctuations in operating results"

13/ Some quick math suggests @Uber is working with ~1/3 of global @McDonalds. If they were truly doing 10% of food sales at those locations, that would be 3% of McD's total revenue, or $750M annualized. That would mean McD could be ~10% of total @UberEats volume?

14/ And yes, there are lovely endearing stories of @UberEats as savior too. Well, there's one.

15/ At @ThanxInc we believe strongly that this is a trend other industries have seen before. In fact, hospitality has seen it with the rise of third-party aggregators in travel. This is why airlines invest so heavily in CRM/loyalty.

16/ Restaurants are just latest hit by this. In fact, some segments saw it before with @OpenTable who took their customers and then charged to see them again. The only counter is to build an "owned audience" of customers that you can talk to directly. Will restaurants wise up?

17/ Finally, it's also worth saying: this company (and chart) are f-ing impressive. A true force and generational behemoth. Congrats @Uber. Now be nice to our restaurant friends.