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DISCLAIMER: I AM NOT A GUIDE FOR HOW YOU CHOOSE TO INVEST OR THE CAREER DECISIONS YOU MAKE THIS PRESENTATION IS THE REASON I AM BULLISH: https://static1.squarespace.com/static/5c13f4c6e17ba3aca12b9686/t/618b3d9d89755c08ab3bc41d/1636515230864/Cat+Rock+Capital+Presentation+on+Just+Eat+Takeaway.com+10+November+2021.pdf So let me start by saying, I am not trying to be a corporate shill much like what people will peg me as. I don't like corporations as much as the next guy, but I think it's actually a really good opportunity to join Grubhub or buy the stock and potentially win big. I say this because there are a ton of posts on Blind/Reddit trying to find the next "IPO" (looking at you Rivian). However, I believe there are some companies in plain sight that can potentially 5x in terms of market sentiment and the government printing money in the next few years. Grubhub is one of them. Before we dive into the potential, I want point out the issues with Grubhub, and where there is risk. Current Issues: - Loss of market in suburban US - UI/UX (They improved UI recently but the logo / colors lack) - HIGHLY competitive GIG companies in US Markets - Reduction in Capital from stock market - Economics of gig based companies (Fee's / Caps) I do think these are large problems, but I think the potential is still great. So let's address them one at a time. Loss of market: I believe this is one that Grubhub definitely fumbled on, which was the US Suburban market. They didn't respond to COVID effectively in suburbs and they ate a fat L. However, I think there strategy is still sound, which is to focus on cities which VALUE convenience and fast delivery. The thesis is that when people go back to the office (highly debated) they will be less likely to order delivery. This would be especially true in suburban areas where there is a lot of driving. I for one would have a higher likely hood to drive to a restaurant to pick up food then deliver it. This might not be the same for living in a highly dense city. It's a moot point, but a strategy that is valid. I also think by pouring money to become the clear winners into these metro areas from other regions where JET (parent company of GH) which it is the clear winner in, it can drastically improve logistics and cost which will improve its unit economics. UI/UX: The UI/UX and branding from Grubhub is confusing. It has the JET logo to be more in-line with the parent company. This logo to me is trash and can be improved. I am a firm believer that if you have the engineering + users the marketing is the easiest to improve. Moreover, I have seen improvements in the app with reels, and frankly I am thinking they will keep getting better because DASH is now more focused on putting ads on its mobile landing page which will dissuade users. Highly Competitive GIG economies: GIG based companies like DASH, UberEats, Instacart etc. are super competitive and currently DASH has the edge. I think DASH is absolutely overvalued (15x revenue), it doesn't have a global presence and cannot acquire direct competition due to SEC laws. So where does it put DASH? It puts it in a highly competitive place where it needs to prove its unit economics and hold its position with a stock price that I believe will tumble. DASH needs to expand and grow but the market is so competitive and it is behind in the global economy losing in Asia, Europe (JET is the winner owns GH), etc. If they don't buy a grocery delivery company like Instacart, it puts them in a really weak position. This is why I believe it will deal with Survivorship bias, and it's exactly what Grubhub dealt with. It will seem like they are the winner and their lack of foresight can be their doom. DASH is so expensive, a larger company won't even look to acquire it, nor do I believe their leadership will allow it to be acquired. However, this makes Grubhub look like a steal in retrospect, because companies such as AMZN, Walmart, etc would all be good candidates to BUY GRUBHUB!. Yes, I believe they will get acquired or WILL partner with the likes of Instacart. This has huge potential upside, because the market needs consolidation. Also what is a better owner then AMZN their logical play is to move into food delivery that is already proven. Why do I think they will be acquired, well the CEO of JET Jitse Groen said it himself :). Moreover, so did the second highest stakeholder in GH. CEO of JET https://www.reuters.com/technology/takewawaycom-shares-dip-investor-day-growth-target-disappoints-2021-10-21/ Second Highest Stakeholder of GH Article https://www.businesswire.com/news/home/20211025005332/en/Cat-Rock-Capital-Sends-Letter-to-Just-Eat-Takeaway.com-%E2%80%9CJET%E2%80%9D-Board-Urging-Sale-or-Spin-Off-of-Grubhub-by-End-of-2021 Second Highest Stakeholder of GH Presentation https://static1.squarespace.com/static/5c13f4c6e17ba3aca12b9686/t/618b3d9d89755c08ab3bc41d/1636515230864/Cat+Rock+Capital+Presentation+on+Just+Eat+Takeaway.com+10+November+2021.pdf Reduction in Capital: The stock is taking a hard tumble. I believe that GH is reaching its floor, and will bottom out. It might also seem like they are hemorrhaging capital, but they are actually getting more and hiring like crazy. That is because the strategy of JET is to take from winning markets and grow losing ones. JET is the 2nd largest food delivery company in the WORLD. Capital from JET is a lot more than it might be perceived. Economics of gig: Gig economies as a whole have shit margins, and with Fee caps etc. it makes it even harder. However, what if I told you that these fee caps aren't here to stay. The reason being is that these companies are actually GOOD for restaurant's. There is weird sentiment that these companies are bad for restaurant's, but actually they are good. They are increasing revenue for them drastically, and solving logistics that the restaurant would not care to do. The shift to dark kitchens as well will only make their economics better because they can disrupt the market to have different levels of fee caps. Also, fee caps are being appealed left and right and I think they can win, because of the level of scrutiny into such laws. They are actually making huge headway here, and I think GH has a strategy to improve its economics with all of its partnerships with Corporations + Campuses using robotics. Cramer(I don't like this guy) on restaurant's needing food delivery https://www.thestreet.com/jim-cramer/jim-cramer-restaurants-need-doordash-uber-eats-grubhub Amazon Prime GH https://www.amazon.com/prime/offer/GrubHub/student-discount Robotics Partnership with Ohio State https://media.grubhub.com/media/News/press-release-details/2021/Grubhub-and-Yandex-SDG-Launch-Robot-Delivery-Technology-at-The-Ohio-State-University/default.aspx DoorDash Appeals https://www.liberationnews.org/san-fransisco-gig-workers-demand-doordash-drop-appeal-of-prop-22-ruling/ TLDR: GH has a lot of potential growth opportunities with their stock, but what makes me the most bullish is the potential of an ACQUISITION OR MERGER WITH AMZN. In general the stock is undervalued, and is still growing like crazy. Even if they are losing to DASH, they will still continue to grow and improve and both may not fail. TC: 235k #software #swe #stock #stockmarket #stockoptions #grubhub #doordash #ubereats #stonks #instacart #amazon #finance #rivian #google #faang #money #walmart #square
So…Grubhub’s only value is that Amazon might buy it… call me skeptical Grubhub on its own is seen anecdotally as the “shitty version” of Uber eats and DoorDash and has no moat or unique features.
It’s not the only potential buyer or partnership opportunity. The presentation articulates the value more to other companies. I will also say that it is growing YOY on orders and improving its economics. It’s fallen a lot in price, and it’s a real good opportunity to buy especially for LT.
They are already public! That’s what I meant by they already hit their floor.
We’ll keep crushing GrubHub and Uber Eats The hustle for more market share never stops
While highly speculative, it does pique my interest that CEO and stakeholders want GRUB to be acquired. It would make sense for a company like Amazon to square GRUB as they are constantly branching out into different industries (MGM, PillPac, Twitch, Audible, Ring, etc).
Where is the bottom at ?
9.00-12.00 it’s well below FV.
What are your thoughts about joining Grubhub from a career standpoint? Or do you mean it’s a great opportunity to join solely based off of RSUs and stock potential
No idea, but I genuinely think they are growing. I believe when you join a company is really important, especially with RSUs. Their stock is undervalued, and RSUs if granted soonish could be worth a lot in the future. It’s strategic. If I joined Dash or some other FAANG what is the potential of high growth at this point. I’d risk it for at min for the 5x returns which still wouldn’t be as high as DASHs market cap.
Hey datadog, could I possibly dm you for a referral?
This same presentation was done when BlackBerry, Nokia, and Motorola were bottoming out while Apple and Android were on the rise. How they were once mega titans and investing in those companies at rock bottom prices was the best move. Where are they now? Grubhub is dying plain and simple. They had 90% market share 5 years ago and are down to 15% now, against a startup founded by 3 college kids with limited resource. It’s over.
Dam you a hater Doordash
He's not hating jts the truth. DD is on the rise
GrubHub has been already acquired. What am I missing?🤔 https://investors.grubhub.com/investors/press-releases/press-release-details/2021/Grubhub-Stockholders-Approve-Transaction-with-Just-Eat-Takeaway.com/default.aspx
The company they just acquired Grubhub (Just Eat Takeaway) already has their shareholders asking them to sell Grubhub even though they just acquired them. They realize they are a loss leader.
Hi OP, how do autonomous vehicles fit into your analysis?
Impressive