In the early 2000s in New York and Chicago, two groups of people had the same idea: What if we could order takeout online? In New York, this idea formed into Seamless. In Chicago, it became Grubhub.
At the time, ordering food was a hassle. People were restricted by what menus they had lying about, and paying by card meant reading out the numbers on the phone.
Grubhub and Seamless both changed that by uploading restaurant menus online and storing card information, making the process a lot easier. Both charged restaurants 10 percent commission for every order, although that has since risen to more than 30 percent in some cases.
For the first decade, Grubhub and Seamless dominated in their respective markets, but began to encroach on each other’s in the early 2010s as food delivery started to take off. In 2013, the two companies agreed to merge, creating a powerhouse that controlled 70 percent of takeout orders.
As the two merged, a new form of food delivery was beginning to emerge in California, led by Postmates, DoorDash and Uber Eats. Instead of simply aggregating takeaways, these new platforms provided delivery service for restaurants (at a higher commission) alongside the online portal.
Grubhub CEO Matt Maloney called this “the dumbest business you could ever be in”, as it offered razor-thin margins even with 30 percent commission. But, due to stock market pressure, in 2014 Grubhub announced its own delivery service, which has since expanded to cover most major US cities.
Grubhub still generates most of its revenue through non-delivery orders, however it has become a larger part of the business. In 2019, the company posted its first ever yearly loss, which it blamed on its delivery services and the competitive market.
Since 2015, Grubhub has steadily lost market share in the US, as Uber Eats and DoorDash claimed more users. From a high of 70 percent, Grubhub sits at less than 20 percent market share in 2020, behind DoorDash at 45 percent and Uber Eats (with Postmates) at 30 percent.
Even with this loss of market share, Grubhub has continued to generate more revenue every year since going public. It has climbed from $500 million in 2016 to $1.3 billion in 2020.
Grubhub has, like most food delivery apps in the US, had its fair share of controversy. It has been criticised for setting up phony websites of local businesses and earning commission from routed phone calls, which may have not ended in a purchase.
Many local business owners have complained about Grubhub’s hefty commission, although Grubhub is not alone in this, as DoorDash, Uber Eats and Postmates all offer similar rates.
Due to its size, it has also been labelled a monopolistic organisation, for forcing local businesses to offer the same prices online as they do offline, despite the large cut Grubhub takes.
In 2020, Uber approached Grubhub with an acquisition offer, after failing to acquire DoorDash. At the same time, Just-Eat Takeaway launched a $7.1 billion bid, which Grubhub accepted in June 2020.
The acquisition adds a new source of funding for Grubhub to continue competing with DoorDash and Uber Eats in the rather low-margin market of food delivery. The combined company generated $3 billion in revenue in 2019, making it the largest food delivery operator in the West.
Grubhub will remain a separate business, although it may be the end to any operations outside of North America for the company.
We have collected data and statistics on Grubhub revenue, users and orders. To find out more, read on below.
|People||Matthew Maloney (co-founder, CEO), Adam DeWitt (President, CFO), Maria Belousova (CTO)|
|Parent company||Just-Eat Takeaway|
Note: Grubhub merged with Seamless in 2013, which is why revenue tripled.
Note: Parentheses indicates loss.
Grubhub Gross Food Sales
Grubhub Orders Per Day
Grubhub US Market Share
Grubhub US Competitors: Food Delivery Market Share
Grubhub Competitors: Revenue and Countries Available
Note: Grubhub is merged with Just-Eat Takeaway. Uber Eats revenue includes Postmates.
Grubhub other key stats
- Grubhub has lost market share in the US every year since 2014, yet has generated more revenue every year since going public (Grubhub)
- It recorded its first loss since going public in 2019, which it blamed on its growing delivery service (Bloomberg)
- 65,000 people deliver food for Grubhub in 300 US cities
- Grubhub employs 2,750 people
- Over 90 percent of New York food delivery orders are made by Grubhub or Seamless (Recode)
- It also holds significant leads in Philadelphia, Chicago, Boston and Jacksonville
- Grubhub is available in 4,000 US cities
- Plant-based orders increased by 135 percent in 2019, vegan burgers were 291 percent more popular than the year before (Grubhub)
- The combined revenues of Grubhub and Just-Eat Takeaway make it the largest food delivery operator in the world (FT), with $3 billion in yearly revenue