DoorDash’s $3.6B Bet: Why Owning Europe’s Leftovers Is the New Power Move

Doordash is chasing something bigger than takeout

A few months ago, I ordered a sandwich from Deliveroo. 

Nothing fancy - just a tuna melt from a café down the street. 

After an hour of nervously refreshing the app and wondering if my lunch had been spirited away to a different continent, it finally arrived: lukewarm, a little sad, and £12 lighter than my wallet had been that morning. 

I swore off delivery apps right there and then.

Of course, by the next weekend, I was tapping for a late-night kebab without a second thought. That’s the gravitational pull of food delivery - no matter how bad the experience, convenience always wins out over principle.

It’s that same pull that has DoorDash reaching across the Atlantic with a $3.6bn bid to acquire Deliveroo, the UK's second-largest delivery app. Even if Europe’s market looks battered and bruised, DoorDash is gambling that the scraps still hold serious value.

Deliveroo, while not exactly in its prime, is far from irrelevant. In 2024, the company posted £2.07bn in revenue and served an average of 7.1 million monthly users. Yet, its share price has almost halved since its much-hyped IPO in 2021. Investors, no longer in the mood to fund growth-at-any-cost business models, have turned away from delivery apps in droves. Growth has slowed, competition has stiffened, and profits remain elusive.

DoorDash doesn’t seem deterred. As the largest food delivery company in the US, with $10.7bn in 2024 revenue and 42 million active users, it’s no stranger to a tough fight. And now it’s applying a familiar playbook: when the market gets choppy, go shopping.

The offer - priced at 180 pence per share - isn’t just a headline figure. It’s an open door to 10 European markets where DoorDash currently has little to no presence. It's a shortcut to scale without the headaches of building local operations from scratch or dealing with the regulatory nightmares that might plague a more aggressive expansion.

There’s historical precedent here. In 2021, DoorDash acquired Wolt, a Finnish delivery darling, for around $8bn in stock. That deal multiplied DoorDash’s international footprint overnight, teaching the company that buying struggling but strategic players can sometimes beat organic growth at its own game.

The Deliveroo deal, though smaller in dollar terms, is no less strategic. It positions DoorDash to fortify its European presence at a time when competition is thinning, and valuations are low. It's a move that turns today’s weakness into tomorrow’s empire.

And the timing could hardly be better. The pandemic-driven surge in restaurant delivery has faded, and the post-lockdown world has exposed the fragility of the food delivery model. Deliveroo, recognising the tough road ahead, has already exited Hong Kong, selling assets to rival foodpanda to stem its losses. Meanwhile, its brand still holds a certain cachet in the UK and beyond, making it an attractive target for a company with deeper pockets and broader ambitions.

The real play, however, goes beyond burgers and burritos. In February, DoorDash CEO Tony Xu signalled that the company’s ambitions stretch far wider than restaurant delivery. Xu described DoorDash's future as that of a "digital powerhouse," with plans to dominate not just food but a whole range of local commerce categories.

In the US, DoorDash now delivers everything from groceries and pet supplies to flowers, beauty products, and DIY tools. It counts partnerships with 94 of the top 100 restaurant brands and 44 of the top 100 retailers. Buying Deliveroo gives DoorDash an instant infrastructure to push this broader offering into Europe - essentially turning Deliveroo from a restaurant courier into a full-spectrum local logistics platform.

Owning the infrastructure means owning the customer relationship at the critical "last mile" of commerce - a slice of the market that’s only going to grow as more retail shifts online. Groceries, pharmacy products, home goods: anything that can be ordered online and dropped on a doorstep becomes fair game.

That broader vision explains why DoorDash is prepared to spend $3.6bn on what some might see as damaged goods. To DoorDash, Deliveroo isn’t just a food app on life support - it’s a golden bridge into Europe’s homes, wallets, and habits.

Back when my soggy sandwich finally arrived, I asked myself why I kept trusting these services. The answer was simple: convenience beats everything. DoorDash is betting the same logic applies on a global scale. With the right mix of operational muscle and market timing, today's soggy sandwich could turn into tomorrow’s feast.

In the ruthless world of delivery apps, where margins are razor-thin and customer loyalty is fickle, scale is the ultimate defence. DoorDash isn’t just buying Deliveroo’s users. It’s buying time, trust, and a head start in a new continent.

In the end, $3.6bn might look like a small price to pay to own Europe’s next big last-mile empire - even if it’s built from the leftovers.