Hacker News Reader

Comment by arcticbull | Hacker News Reader

I mean the idea is that you operate at a loss until the economies of scale catch up and you begin being profitable. Starting with the low price let’s you maximize growth, and you make it up on the back end. That’s not a problematic system. What is problematic is if there are no economies of scale.

View on HN

Economy of scale applies to production think chips & screens. What economy of scale can DoorDash achieve? Persuade everyone to be paid below fair wage? Push the margin of restaurants down?

I see a kind of future where restaurants are reduced to a kitchen and packing area, with no seats. Then several kitchens bunched together to save on rent and utilities. Then cut out the drivers with air or land based drones. Then start lobbying so that the drones can move underground, and new buildings have to include a drone delivery vent / conveyor belt.

You already can live your whole life and never leave a house, working remote or playing the stock market, having everything delivered. It's grim. And it's coming.

> I see a kind of future where restaurants are reduced to a kitchen and packing area, with no seats. Then several kitchens bunched together to save on rent and utilities.

Isn't that a food court? I'm not sure you've described a particularly grim future. I mean, there's lots of grimness in the future. But you haven't described it.

Most restaurants in my city use UberEats. A fraction of them have bothered to setup with the 2nd most popular competitor. Fewer yet with the 3rd. And you never see the 4th or 5th. UberEats becomes an obvious money-on-the-table might-as-well for everyone with its incumbency.

Same with the user perspective. I use UberEats because it has all the restaurants. I'm not going to download the 2nd most popular app.

> What economy of scale can DoorDash achieve?

Brand awareness among both diners and restauranteurs. Integration with POS systems and financial plumbing.

Economies of scale might exist any time you have infrastructure that can be shared.

I'm not saying DoorDash, I'm saying the business model, which is what the poster was rallying against. I've no particular opinion that DoorDash will achieve an economy of scale.

Ahh, what you lose on every transaction you make up in volume.

Got it!

What you lose on transactions today you make up on transactions in the future, when the volume reduces your cost basis to the point of profitability :)

It’s not clear how that would ever happen with last-mile delivery, unless we’re talking about something like drones or self-driving cars, and of course, those problems seem like they would be better solved by drone companies and self-driving car companies.

Except what every startup in Silicon Valley doesn’t seem to realize is there’s a revolving door of VC funded “businesses” that fail because they can’t make a profit after 10 years. And if they try to make a profit (for example by raising prices) users move on to the new cheap option.

I don't think it's the startups that don't realize, rather the stock market that slurps up the IPOs and fuel it.

No reason to complain when you're the one picking up the unit loss, though. Might as well take it while you can.

Unless you care about not fucking over your fellow citizens to get free food deliveries?

If I offer you $2 to deliver a piece of food, have I fucked you over? Where exactly in the pipeline does the "fucking over" happen?

In the part where I have to deliver it 10km away ($3 in gas round way), and if I reject your kind offer you’ll blacklist me from ever being offered a job again?

Ok, so prior to this offer, you had no jobs. And after this offer, you have no jobs. How have you been fucked over?

Reply on news.ycombinator.com