Instacart Closes Latest Funding Round at $3.4B Valuation
bloomberg.com
bloomberg.com
So my question is: how do investors project that an intermediary like Instacart can outcompete the same service provided by the supermarkets themselves? Doordash can compete on variety and speed, but most folks shop at the same one or two supermarkets all the time and rarely need groceries urgently.
https://www.theguardian.com/money/2015/may/02/online-shoppin...
Why have the major retailers here been so slow off the mark?
[ADDED: For example, Peapod is only available in some areas of the Northeast and Midwest]
It's been done for at least 5 years.
One of the delivery guys even walked through our (open) door, dropped the food on the coffee table and put the VHS tape in for us.
Sadly, those economics didn't work out.
This service is not so popular yet (Im having hard time counting one friend who uses delivery services) but make it popular enough and Instacart and others will be out of the door.
This will be similar to LA-Fitness and other chains of gyms like Gold's Gym forbidding outside trainers for training gym members. You can only hire a gym instructor that is employeed by gym you attending.
Of course Instacart can ignore such ban and shop "incognito" but I doubt it would be great sales pitch to shareholders/investors.
But on the topic of delivery/fulfilment, look at some of our grocers in Canada (Metro, Loblaws, Walmart) who are worth billions of dollars, yet whose only foray into online ordering is for pickup. Wow! Innovation!
A Loblaws near me was applauding itself for setting up the ability for buyers to order products online and pick it up in store, while people in the UK and parts of the US have been able to order groceries online and get it delivered for years. In 2013, Amazon Fresh expanded to SF. Full ordering and fulfilment. While in 2014, Loblaws launched the concept of click and collect, but has not expanded their offering to include delivery.
It's baffling to me that neither Loblaws nor Metro have at least tested online ordering and shipping in downtown Toronto like the way Amazon Fresh expanded into major American cities.
Now I live in downtown Toronto and I have to walk to the store (no car here) a carry groceries home, which means at best I can purchase a few day's worth of food at a time.
I would so gladly pay a reasonable amount for delivery, and I don't mean these bespoke pick-everything-and-deliver-within-an-hour services - I just want to be able to choose a time, pay maybe $5-$10 and have a week's worth of food delivered. Is that so hard Loblaws?
Yes. $5-$10 isn't a lot to get time critical cargo (spoilable food) that last mile.
Apparently it's at a level of difficulty such that Australia and the UK stores have already been doing this for the past 5-10 years...
It takes time for the labor- maybe 2 hours of time for someone to get your food, bring it to your house, and go back. So that's probably at least $30 worth of their time.
So yeah, $5-$10 is not reasonable. If you're paying that little the labor is being subsidized by something else, or you're exploiting a desperate underpaid worker.
The marginal cost of one delivery is obviously not 2 man-hours, that'd be ridiculous.
Why not? 1 hour to walk around the store and collect everything, 20 minutes to check it out, load the car, drive the the person's house, 10 minutes to walk the groceries to their apartment, wait for them to sign and open the door, 20 minutes to drive back. At least 2 hours of work.
[0] This assumes you're in Instacart's target market, aka rich yuppies who don't live in East Harlem
With Instacart, the pricing is extremely blurry with an added-on fee of ~20% or so. I can't justify spending $20 + 20% on groceries. I might as well as just order out every day.
https://np.reddit.com/r/boston/comments/5xj47l/ever_what_ins...
Maybe I'm lucky that I live within walking distance of a grocery store, but I'd be hard pressed to pay anything more than $5 for someone to drive my groceries to me. I could afford to pay for it, but if I kept that mentality my finances would die the death of a thousand papercuts.
BTW, for the grocery market., a $3,4B valuation isn't that large .
Plus I don't think Instacart is really in the grocery business. They are in the delivery business and grocery stores are their warehouses. I really have a hard time seeing $3+ billion of value there.
Maybe they are thinking about getting into the grocery business though.
http://www.businessinsider.com/whole-foods-biggest-problem-2...
But the bigger issue with Instacart / Google Shopping Express is they're effectively value-add middlemen whom can be cut-out, undercut, gamed and so on. WalMart, Safeway/Vons, Amazon, Costco have the muscle ( distribution and capital) to squash them like Mr. Wonderful's proverbial cockroaches.
edit: update- couldn't find the specific post I was thinking of from hackernews but here's someone downthread who posted similarly outrageous findings: https://np.reddit.com/r/boston/comments/5xj47l/ever_what_ins...
How hard is this? Online ordering and grocery delivery is an existing thing and was before Instacart.
>It's similar to why self-checkout still doesn't work well at many stores
Self-checkout is a pain in the butt for things like produce. When you do a large grocery shopping, it is much easier and more efficient to have a clerk quickly scan everything (and there's usually a bagger too).
There are some experiments with shoppers self-scanning as they shop. Maybe something like that can still eventually work and you deal with produce somehow. (And figure out ways to minimize losses.)
This was done several years ago in the UK. American grocery stores are way, way behind the times.
EDIT: relying on anecdata from HN comments, I have never tried online grocery shopping in the US.
the delivery service is actually a loss leader for instacart's underlying business, which is influencing purchase decisions through their app and getting paid for it. this is where brands compete with each other (just like shelf space in the store, which they also pay for), so it's where the money is. instacart also has fantastic shopping data tied to individual accounts that they can monetize in a number of ways. and then there is a bit of a winner-take-all element in that grocery stores are unlikely to want to integrate with more than one such service.
this last part is where the valuation comes from - it's a bet that instacart can become critical marketing infrastructure for the grocery industry. like many others, i'm skeptical because it's a risky strategy, but if they pull it off, they get a big payday.
You don't have your email listed, but I'd love to get in touch if you could email me (in my profile). Thanks!
i have been working on the "future of work" problem and so have thought a bit about the business models of on-demand companies like instacart (relative to what they pay their workers). and i've been lucky enough to have people with interesting perspectives to talk to about such things.
Which is why the recently announced a change to tipping, where it would no longer be hanlded separately but instead as part of the regular checkout so as to make their revenue numbers look better.
They could certainly look into an advertising model for virtual shelf space, but that will be a significantly smaller amount of money than what they are doing in grocery delivery.
This is the same play as Seamless/Grubhub, and while they have a "promoted" listing which generates revenue, the majority of their revenue still comes from creating and order and doing the delivery.
The real benefit to Instacart from an investor perspective is that they are taking a distributed market and consolidating it into one single player. So while some stores may do their own delivery, by consolidating that space into a single player they are able to create tremendous volume.
Now, at 33% the value of whole foods that's a different matter. But there are some attractive pieces to Instacart's revenue story.
They don't stock inventory, so there aren't many carrying costs, they are charging 20% on the order which means they directly benefit from customers spending more and you can quickly see that their immediate revenue model assuming they can keep costs under control is definitely enough to justify the price.
The real question is how much money they are losing and if they are able to become profitable in the long run, but that will be a question that is decided well post IPO.
So while some stores may do their own delivery, by consolidating that space
into a single player they are able to create tremendous volume.
clairity makes an astute point that Instacart's personalized data is more valuable than any single grocery store's data. and competing on "store shelves" allows them to negotiate with brands directly, and totally circumvent the grocery stores.
.... but in order to do that, they need to capture the market, and they need their operating model to work well for long enough to meet that goal
If that were true, wouldn't a heck of an easier approach have been to setup an "ad network for retail delivery apps"? I think you might be underestimating both the difficulty of the logistics side of their business, and therefore its value as well. I've never really looked into Instacart (Not available here), but I imagine a more likely Instacart investment thesis is "if local businesses were given the option to not have to manage their delivery fleet, with minimal impact on other parts of their business, would they switch? + How much can we reduce the cost of local delivery due to scale/volume, and therefore is a monopoly position in local delivery achievable?
it's certainly possible that they have a credible story around how they get operationally profitable with the delivery business, but that's a margin-limited business that i don't think investors will get excited about. data and services are relatively high-margin businesses and that's why i think that's the play here.
but i agree that whoever solves the very hard last-mile logistics problem is going to be fabulously well-positioned (amazon, walmart, fedex, ups & uber seem to be the leading contenders). thinking that scale/volume will solve the problem is enticing, but so many companies have chased that holy grail only to fall short that i'm not sure that it isn't a mirage.
Home delivery has been a standard offering from all major supermarkets in the UK for 5-10 years now. It's available in built-up areas and cities, as well as rural villages. They are able to do next-day delivery and give you a 1 hour delivery window. Groceries are the same price and delivery ranges from £1-5 depending on the delivery window you select. I really don't see how Instacart could compete with that if Wallmart and the others start to offer it in the US.
the other disadvantage of verticalization is that it limits access to consumer data. an aggregator like instacart will have access to comparative consumer data across stores and i think that should be far more valuable given how competitive the consumer products space is.
What service do supermarkets provide themselves? I think it's debatable. Safeway in CA had delivery, and using it was a guaranteed way to get bruised, nearly un-sellable produce. Safeway must have told its pickers to pick the fruit and vegetables that were about to expire... and the same for milk, cheese, or any limited shelf-life item.
Instacart has only the incentive of pleasing the customer. I've had zero issues with suboptimal produce being picked by Instacart shoppers.
So I'd argue that whatever supermarkets need as a core competency to compete in the existing (pre-Instacart) market, providing high quality delivery and e-commerce experiences are not part of that.
I think supermarkets are essentially market makers for household goods, produce, etc. They must understand demand in order to keep the right items in stock.
Beyond that, they seem to flounder between providing super-low margins (and the corresponding slow checkout lanes) or a more premium expeirence with higher markup and other entertainment features (music, oyster bars, etc.)
In the cities I've lived in, all of the in-house delivery options had significantly constrained delivery options.
In most cases we are helping retailers create a new delivery experience for their customers, not replacing one that exists. It's actually quite complicated to operate our business and there are economies of scale that retailers benefit from by being part of a marketplace.
Also, when we talk to our customers about why they use Instacart, many of them do need groceries urgently, which is one of the reasons they use Instacart over alternatives. Most orders are delivered within 1-3 hours of being placed.
This strikes me as another version of AutoByTel.com Remember them? They worked between you and the dealership, and generally got you a much better price on a car, usually the fleet rate.
They did well until dealerships figured out how to use the web, and then the company hasn't been anywhere near as relevant for a long time. It tough existing between web-based customers and physical dealers. There isn't a lot of loyalty, so as soon as tgere is a better price customers will change sites. Also, Autobytel's business is really offering highly qualified sales leads to dealerships. The basics are nothing fancier than that.
I see the same thing for Instacart. Grocery stores tend to be effective at shipping stuff around, but tge same "shoping" experience has worked for many, many years.
It seems like the grocery stores have a lot more power than Instacart, and Instacart is going to have a very hard time getting between customers and stores. It's going to be hard to make a profit when stores offer free/cheap delivery and develop their own shopping apps.
They already do. We sometimes use personal shopping at Whole foods, it costs like $15. You drive up and pick up the groceries. Super easy. Another smaller chain store, for $20, they will shop and deliver to your door.
While great in terms of saving time, the problem is that you sometimes dont get exactly the item you would have picked nor get the option to pick up extra items or things on sale.
Seems to me that the grocery stores have an advantage of Instacart in this, actually, because they have access to their own inventory systems while Instacart doesn't. To vertically integrate delivery would make a lot of sense.
With something like Uber or Lyft, you're accessing a pool of drivers that can't immediately be created by a small competitor. Even in a local environment.
With a grocery store I'm generally ordering from the same place repeatedly. If they offer the same service directly, I see no advantage to dealing with Instacart.
Maybe if they integrate vertically but at that point they become a modern grocery store without a store front (I bet they're considering this already). But otherwise they're just tacking a markup on something the stores can do directly.
Another example would be a maid service like Homejoy. It's great if you don't have a contact to begin with but once I've had a maid come to my house, I want the same person to come back again. It's in my interests (cheaper, same person) and the maid's interest (no commission to service) for it.
It sounds like this sort of business can only exist in non-competitive spaces.
The biggest problem with Instacart vs Amazon Fresh is that with Instacart you never really know what you are going to get. You never know what your end bill is going to be, and you never know what the real markup is. I don't think I've ever place an order on Instacart and had it filled 100% with everything I wanted. Place a large enough order and 10+ items might be missing. Miss the call to try and find a subsititue? Too bad.
The end user experience for Instacart is actually pretty damn bad. It's often just "better than nothing", but I don't see how that's sustainable.
Instacart used to prompt the buyer to approve all substitutions, but it got tiresome pretty quickly. Now you can still do that, but the default experience lets the shopper make the (usually obvious) choice.
Grocers do not always have everything in stock, and so I think Instacart's solution is the best I've seen so far. If you are someone who wants to know the exact total in advance, then request no substitutions, it's very simple.
The Amazon Fresh model is far superior. If the item is out of stock, it shows out of stock.
People will put up with Instacart until there is better solution—any really—because Instacart's solution is terrible.
How is this better? Most supermarket items are sold alongside many competing items that are nearly identical. As a customer, I may or may not have a strong brand preference.
In my case I have a brand preference for only about 10% of the items I buy. For the rest I'm largely indifferent. Also, in the vast majority of cases, the store brand is an adequate substitute.
So I would argue that by actually applying intelligence to the problem, Instacart's approach is better. Showing out of stock puts the burden on the user to solve the problem of which alternative to choose.
the disintermediation that you talk isn't applicable here. instacart is creating and sharing value in the value chain rather than trying to take a cut from the downstream customer (i.e. dealerships, in your example).
That depends on what grocery stores are good at. It seems to me that grocery stores are the ones with the outdated model. Why would we expect people who make many multiples of the wage paid to a shopper to enjoy wandering through a warehouse putting goods into a cart?
High end chains offer samples of gourmet food, pleasant music, oyster bars, etc., but ultimately when I'm there I'm sacrificing a LOT of time simply for the pleasure of shopping manually.
Instacart has created an extremely polished, highly usable shopping experience. When I order I don't really care where the items come from (I have no loyalty to the local grocer). I typically shop at Whole Foods because it carries many high-end items, but why should my grocer have to buy prime retail space just to put a bunch of short-shelf-life items on display in a beautiful shopping environment hoping that I'm happy to pay a 20% markup over a Safeway or other competitor?
Instacart is the best solution to the problem of "how do I keep my fridge and pantry stocked with the items I want with minimal cost and effort" problem.
Think about if we had to browse through cartons of mail in a local postal service warehouse just to collect our mail. Delivery makes perfect sense for things that we need on a routine basis.
> but tge same "shoping" experience has worked for many, many years.
This is almost an absurd luddite-ism and I won't even respond :)
[0] http://www.huffingtonpost.com/2015/02/02/instacart-workers_n...
Green?
https://www.google.com/search?q=instacart+shopper&source=lnm...
Not to mention the free samples. Shopping at Whole Foods all day would mean tons of free chips and guac, gourmet cheese, etc.
In this particular example, however, those points are completely irrelevant as he just used his app to show off Instacart's delivery feature.
Beer, Maleness, being physically present in the USA, English - all of these are group signifiers.
It saddens me to see HN users rejecting this on a day designed to highlight this inequality.
[0]:https://np.reddit.com/r/boston/comments/5xj47l/ever_what_ins...
I have not noticed a significant increase in prices (other than Tips & Delivery) over my previous weekly spend at H-E-B, but...I seem to have a lot more targeted shopping cart doing it over InstaCart.
No matter what, for the hour+ it saves me, its probably well worth a <20% markup.
Ouch.
So as long as Instacart can survive with 1% of regular folks shopping with them, they are golden.
People who want to make a little extra cash then log on to the app, look for tasks nearby, and pick a task they want to complete. Then they buy it, deliver it, and get paid.
The stores are partnering with the app to provide their inventory, so that you can pick what you need and expect it to actually be available for your shopper to buy.
Curious to see if something like Instacart would break through here.
Also, who wants someone picking through all their produce/meats/perishables? That's a pretty subjective thing.
-- EDIT -- I'm curious about others' grocery buying habits because I don't use Instacart.
(I do use a particular delivery service that has direct relationships with farmers, so that could partially explain why it's so cheap.)
In contrast, in Brooklyn, they won't even let you bring the shopping cart into the parking lot. But then again, just about everyone I knew in Brooklyn had one of those pull carts and just used that to shop / carry their groceries home. That said, I generally chose FreshDirect over dragging my own groceries around once FD finally came to Bushwick.
The person delivering food may be able to use different mechanisms (e.g. vehicles) or division of labor (teamwork) that are not practical for the recipient.
> I'd just go out to eat at that point.
This is not always practical or desirable for lots of people: the sick, those with young kids, the infirm, etc.
camera pans, zooms into face
I am askafriend and I am part of the "Amazon generation".
Middle-mile distribution, with a touch of marketing, is all grocery stores are. They just offload last-mile distribution costs to the consumer; Instacart and friends attempt to play economies of scale against that. Yes, they are currently a luxury. But it seems fair to predict they won't be for long.
As with many personal finance questions, it's very hard to make straightforward comparisons because people spend their money in such drastically different ways. The person going out to bars every weekend might express exasperation at the person ordering groceries through Instacart every other week, without realizing that they're both spending the same amount of disposable income but on different things.
In the UK it costs me £1 to have my groceries delivered to my door. My nearest supermarket is only 10 mins walk, but spending a few pounds a month to replace a weekly 30+ min shopping trip with deliveries is still a no-brainer.
And that's before I even consider that my local supermarket seems to have higher prices...
https://hbr.org/2016/07/the-internet-of-stuff-your-mom-wont-...
It's tedious and a waste of time. Some people enjoy grocery shopping. Power to them. I hate it.
Online ordering lets me plan what I want to buy. This lets me research--and save--my preferences in a way that can't be done in the aisle. It also removes the after-work parade of junk-food temptations. Stores are great for sampling. I like shopping at farmers' markets because I can nibble. But for that purpose, restaurants and tasting menus are superior.
I don't use Instacart. But I love FreshDirect. Not only are their prices competitive with brick-and-mortar stores, their produce is fresher. When someone says "I want lettuce on Tuesday," they message their farms and ensure it's picked at the right time so there is minimal delay between harvesting and delivery.
As an aside, if you ever find yourself in a situation where it's possible to do this, I highly recommend taking the plunge, even if it means paying a bit extra in rent. It's been life changing for me.
My daily "commute" is a few hundred feet, and it's really changed my life. "Ugh, I've got to go to _x place_" suddenly sounds ridiculous when that place is a 3 minute walk away. You can wake up later, have more time for everything else in life... it's very nice. Sure, you might have to take a smaller place, but I'd rather have a small place that I can spend time in than a large place I never see.
Playing devil's advocate, the all-in cost of a short commute is likely higher than that for grocery delivery.
Let's compare a White Plains, NY <--> Midtown Manhattan commute to an Instacart delivery. That commute takes about 1 hour [1]. The average 1-bedroom in White Plains goes for about $2,270 a month [2]. In my neighborhood, Flatiron, it goes for $5,660 [3]. Let's assume 260 working days in a year [4], i.e. 520 [5] hours of commute. That $3,390 difference in monthly rent comes out to $40,700 a year, or $78.30 per hour of commute.
By coïncidence, that's what this guy on Reddit [6] estimated Instacart's markup to be. You'd have to order $87 in groceries (i.e. $150 on Instacart) twice a day every working day to come out even against a 2-hour-a-day commute between White Plains and Midtown.
[1] https://www.google.com/maps/dir/White+Plains,+New+York/Grand...
[2] http://www.apartmentguide.com/apartments/New-York/White-Plai...
[3] http://www.apartmentguide.com/zip/10010-Apartments-For-Rent/...
[4] http://www.answers.com/Q/How_many_work_days_are_in_a_year
[5] 260 * 2
[6] https://np.reddit.com/r/boston/comments/5xj47l/ever_what_ins...
No, I'd rather spend that time playing with them @home or park.
I walk to the supermarket every day (which is about 10 minutes each way), and probably spend 10 minutes wandering around inside even if I don't need to buy anything (I'll find something to buy), just to stretch my legs.
For sure if I spent over 30 minutes each way to work, I'd be less inclined to spend a lot of time at the supermarket.
Personally I didn't love Peapod last time I used it a number of years back. But, as someone who has a car and can conveniently go to the grocery store, I'd probably give Instacart a spin every now and then if it were available where I live.
Like you I use services for various things that I could do myself: lawn cutting, oil changing, periodic house cleaning. I don't see anything wrong with it but I do recognize they're somewhat luxury goods.
Or, maybe it's not hard but still worth $20 to save an hour of your weekend. It's not like this is an expense that only the super wealthy can afford.
The US is quite a way behind the times when it comes to online groceries. This is a proven market in other countries.
For reference, 11% of the UK now shop for groceries online[1]. We got our instacart equivalent almost 15 years ago (Ocado[2]). That's a HUGE market. Ocada market cap is something like £1.5 billion last time I looked[3].
Now all major grocery chains offer their own equivalent service, you pick a time slot and pay £5-£10 extra to have it delivered to your door in an hour time slot. Take off petrol costs and it's pretty low cost compared to time saved.
We also have click and collect which allows you to pick up pre-picked groceries on your way home.
[1]http://www.igd.com/Research/Shopper-Insight/Pushing-online-s...
That much? I usually pay £1 for my deliveries. And that's for an hour slot, at a reasonable time, and I usually only have to book a couple of days in advance.
The problem for me is that ordering online is even worse. It fixes the part where I have to lug the bags home and up stairs, but I don't know how to browse for groceries effectively online. At least wandering the aisles is a mentally tractable concept.
So it just all sucks. I mostly settle for listlessly watching episodes of COPS on my Apple TV and ordering one Seamless meal at a time. Oh well.
I was very happy with the service, but my circumstances were pretty specific. I'm now in a small town in the outskirts of a city and they're not an option here. Even if they were, I have to have a car for other purposes and wouldn't use them anyway.
I don't know how they'll expand outside of urban centers, honestly.
On a side note, about half the Ubers I see around here are pickup trucks, which would make using them for grocery trips more practical. Hmmm.
Remember, you're addressing a group of people who probably would drink Soylent if it was sustainable. Some people don't care about the ripeness of an avocado as much as you (or me).
Or perhaps there's room for Instacart Premium, personalised produce selection..
Compared to shopping online, it's quite inefficient.
In a while, when schlepping him around isn't such a production and I'm back to an appropriate amount of sleep, I'll probably start going to the grocery store again - but honestly, right now I can't imagine my life without delivery services.
I no longer fight with my significant other about grocery store trips, and the house is always stocked with healthy, delicious food from Whole Foods.
In 3 years, I'm not sure I've ever had a problem with an Instacart delivery, other than them occasionally forgetting items.
edit: I should have mentioned that I'm not very picky about what is actually delivered, I'm just happy to have a bunch of fresh vegetables, fruit, and sparkling water stocked in my house at all times.
After about a half dozen tries I gave up on Instacart. It was so much worse than just going to the store myself.
I usually order from them when I'm making a large meal with typically uncommon ingredients. Today I'm making Cuban — I needed Seville oranges for mojo, yuca, rice paper for turrón, etc. Instacart is a gamble for me, and the UI is frustrating.
I want to search for several items across stores and see which ones have them all. Instead I have to try stores one by one and see what's in stock. It's not enough to get me to stop using them, but it is annoying. But the really frustrating thing is when they claim a store has an item, but the shopper doesn't have much incentive to spend time looking for those hard-to-find but critical items. So lots of my orders have missing items which I then have to go out and find myself anyway.
Also bad is that many items are hard to order specific quantities of. Some common produce items are sold by the pound, when I really just need one two count (e.g., onions). Worse, some items are labeled "per unit" but when I order two, they're converted to a weight value and I get fewer than I ordered. Again necessitating a trip to the store.
I acknowledge that most people aren't making the kinds of meals I'm doing, and not suggesting they cater to my admittedly small market segment. But if they solved these problems, they would be amazing instead of "slightly worth it".
I regularly use Safeway grocery delivery https://shop.safeway.com/ecom/home and I've always been happy. Delivery fees can get as low as $4 while grocery items are (I assume) the same price as inside the store.
Instacart needs to do something different. Why don't they just copy Blue Apron/Hello Fresh and offer meal packages with all the ingredients and recipe? Hell, I'd be way more interested in the service if I could get that along with groceries.
Postmates
Blue Apron
Hello Fresh
Instacart
Amazon Fresh
etc etc
These companies need to become each other, before Amazon becomes all of them. It seems like the biggest innovation from Instacart I could find was "the company wasn't collecting beverage can and bottle deposits accurately until recently, and the fix has increased gross margins by 25 cents on average deliveries nationwide.". This company is doomed.
Side note, I still can't get over the fact that I can't view a single item they offer without creating an account. Even going to browse their website for this comment, I walk away disappointed.
Expect to see much rougher competition from Whole Foods. They have quietly already started this with their coupon app[1] (the wedge) and pickup (powered by instacart)[2]
[1]https://www.theguardian.com/business/2016/feb/10/whole-foods... [2]https://pickup.wholefoodsmarket.com/
This "servant class" has already existed, but now I feel as if it's being carved out of the already diminishing middle class.
I think you are a bit, because I use a lot of these services and am not rich
Uber/Lyft isn't "I'm too rich to drive" it is "I'm drunk at the bars and need a ride home." or "The BART is closed because high winds blew stuff on the tracks and my flight leaves out of SFO in just a bit. "(Lyft really saved me on that one, no cabs around)
Instacart isn't "I'm too rich to go grocery shopping" it is "I'm a mom of two kids, one of them has diarrhea right now, we need some things from the store"
Etc - have to run but you get the idea
After all, lawn/cleaning/etc. services have long been a thing. So are babysitters, taxis, etc. For someone with enough money, they could have had full-time personal assistants, cooks, drivers, etc.
What seems to be mostly new is that technology is making certain tasks more efficient and/or more efficient to time-slice in a way that people who are merely comfortably well-off but not really wealthy can afford them. (And the challenge is that tasks that are sliced up that way need to be sufficiently cookie-cutter that the context and knowledge a full-time assistant might have aren't required.)
With the exception of taxis, those have traditionally been cash (i.e. untaxed) businesses with no middlemen and long-term relationships. They're "I'm too rich to be bothered," but also "I've been paying you to mow my lawn for years." The new insta-serf companies break this relationship and take a big cut to pay six-figure salaries to a handful of techies.