Grubhub just sold for a tenth of what it was worth during the pandemic
A startup called Wonder is now the new owner of Grubhub. The food delivery app announced its acceptance of the deal on its website earlier today.
Wonder acquired Grubhub from the Dutch food company Just Eat Takeaway for $650 million. Pending regulatory approval, the deal will close early next year. Wonder also announced it has raised an additional $250 million in venture capital funding to further its mission and growth."
Chicago software engineers Matt Maloney and Mike Evens founded Grubhub in 2004 as an online restaurant ordering service and an alternative to those paper menus that showed up on doorsteps and in junk mailings. The company merged with the automated food ordering and delivery company Seamless in 2013. Just Eat Takeaway bought Grubhub in 2020 for $7.3 billion at the height of the COVID-19 pandemic.
The numbers for restaurant delivery apps started to drop once the pandemic became part of history and people started going out again. Legal troubles started in 2021 when Chicago took Grubhub and some of its competitors to court for alleged unfair business practices and fees. Companies like DoorDash eventually settled but Grubhub's legal battle with Chicago is still raging in court, according to the Chicago Business Journal.
The District of Columbia won a similar lawsuit against Grubhub in 2021 that ended with a $3.5 million settlement. The following year, Grubhub announced it would lay off 15 percent of its corporate staff.
Wonder is a new fooddelivery company started by Marc Lore, a former Walmart executive who owns two professional basketball teams. Lowe previously founded Diapers.com and Jet.com. The New York Times published a profile on Lore and his newest venture Wonder, which he said could be the Amazon of food and beverage."
Wonder's original focus was to get its own restaurants up and running" and create a delivery service that offers cheaper, quicker build-outs." Maybe that's because third-party food delivery services like Grubhub, DoorDash and Uber have seen their prices jump in the last couple of years, according to CNBC.
Just in New York City, food delivery prices increased by 58 percent in just under a year, according to Bloomberg. A new law that went into effect at the end of last year raised the minimum wage for New York delivery drivers to $17.96 an hour. The New York City Department of Consumer and Worker Protection reported that food delivery workers saw their wages increase by 64 percent and their tips decreased by 60 percent in just eight months.
This article originally appeared on Engadget at https://www.engadget.com/big-tech/grubhub-just-sold-for-a-tenth-of-what-it-was-worth-during-the-pandemic-204555195.html?src=rss